Dr J Rould
Full-Time Tech Investor, Quantum/Cybersecurity, Philosophy Background
Bakkt's history of pivots, reverse splits and dilution makes it far likelier to go to zero than to become a legendary multibagger. Through each iteration, investors are assured this time is different and it is a whole new company. Occasionally such companies pull it off, but usually they do not. x.comÂ
Bakkt has never generated real earnings and still cannot articulate a coherent strategy to do so. Bull valuations that rest on hoped-for future EBITDA, such as 10x a $100M figure, are wishful thinking. x.comÂ
Strategy's new capital framework marks a shift to selling bitcoin at a loss to cover debts, at best a graceful unwind and more likely a head fake before lower. Having issued perpetual preferreds and converts against an asset with no cash flow, and with more common dilution untenable, it becomes a permanent bitcoin seller whose stack shrinks each year. Saylor sits on about $14B of unrealized losses, and 1920s investment trusts that sold holdings to buy back shares entered a death spiral. x.com … Show more
Bakkt has destroyed shareholder value through dilution, falling from $40 to under $8. A reply the author answers adds that despite NYSE backing and $3.5 billion in revenue, management diluted retail with ATMs and burned $40 million a quarter. The same accounts that once promoted Bakkt now defend IREN's $6 billion dilution. x.comÂ
Top Ships is a serial diluter worth fading after an 82% spike. The Greek shipper is notorious for shareholder destruction, with an active ATM and a reverse-split history, a $10M market cap and a 4.1M share float. Short interest is 7.7%, with 0.27 days to cover, and the downside target is $0.90. x.comÂ
Babcock & Wilcox fits an earnings inflection strategy: a terrible company unmistakably becoming less terrible. The strategy works even better with good forecasts before fundamentals visibly improve, and goes on steroids when a company recently flirted with bankruptcy but survived, as Carvana did at $3 in 2023. x.com x.comÂ
Boxabl is headed the way of 99% of SPAC targets: founders believe their company is the outlier but have no natural buyer, then reverse split a few times and delist. @GalianoTiramani counters that Boxabl has 70,000 investors and millions of social followers, but anyone can raise from retail with Facebook ads and Reg A offerings, and Jet.AI's SPAC team made the same argument. x.com x.comÂ
Hyliion has pivoted many times, and its latest move is just another attempt to save the business, so investors should be careful. x.comÂ
Sadot Group has increased its share count about 60-fold, and years of investors getting wrecked make it hard to justify owning. Traders seeking volatility can find plenty elsewhere with higher potential terminal value. x.comÂ
Ouster, Applied Optoelectronics, Ondas, AST SpaceMobile, IREN and Oklo are statistically more likely to lose money long term if bought today. Most unprofitable retail favorites end up with horrendous charts years later, and survivorship bias is far worse among them, as the 2021 vintage shows. Big winners often come from unglamorous names like Marathon Petroleum, up over 20x in six years. Applied Optoelectronics may work on real demand, but its CEO has failed for 30 years. Keep such bets small. … Show more
ReTo Eco-Solutions' 27% jump looks like a dead-cat bounce after its $15M offering on September 17, and worth fading. It is a serial diluter with multiple reverse splits and a market cap of only $7.3M, and its 35.9M-share float with 0.05% short interest makes it easy to borrow with no squeeze risk. x.comÂ
