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No. of Recommendations: 2
Always enjoy your analysis. I have been reading them for years (a decade or more?) and I hope you continue to do them. You appear to be the sole carrier of analysis on AMSC.

I don't own AMSC and, like you, I find the company hard to pin down. For example, you write, "Projects like Tres Amigas (a project to connect the Continental US power grids) have faded." I own other speculations that fall into the same category and AMSC. You never know if they over-promise or are just hoping without facts.

You mention motors. I can remember a period of years where AMSC was going to replace all the big motors because we'd be able to delay the building of new power plants. That never happened but there was lots of print about that at the time. I can't remember anyone saying, "We need X, Y, and Z and that may be 20 years away."

The X, Y, and Z of superconducting are finally arriving but I doubt AMSC has any patents or relationships with the people doing the work. Now that atom-level monitoring can be done, more and more is being learned about what causes superconducting and that many materials can be made to be superconductive.

I think if AMSC has some silver bullet to shoot in the superconducting world, a giant company will figure that out and buy them out before the windfall ever falls into AMSC's revenue bucket. As you note, this is a company with a market cap of $0.17 billion and that has declined in the last six months.

The three analysts that follow the company, according to Yahoo Finance, expect the company to lose between $.52 to $.95 in 2021. The small share base of 22 million shares is something you'd think the management would exploit. The company has net cash of $49 million and a trailing negative free cash flow of $7.3 million. The company correctly says they are not in danger of going out of business soon. But, profitability on a GAPP basis isn't seen by any of the analysts following the company. Why not sell 5 million shares and bank another $37 million? Or, if the future is so bright, why not have an open buy order for 10% of the float (2.2 million shares) when they hit $5?

Just think. The stock traded for $16.44 in the last 52 weeks. It's previous closing high in the last 5 years -- above $10 -- was $11.44 on 5/2/16. Yet, a $16 stock price didn't lead management to action. The CEO gets paid $1.9 million so he isn't feeling any pain. If I was looking for money to invest in the company, I'd start trimming there.

This is a chicken-and-the-egg situation. AMSC is selling power solutions to cities. Their sales cycle is very long because the installed base is so small. Why not sell the product at a steep loss in order to get an installed base? That money in the bank isn't earning much if any interest so why not get some production volume so product prices can really be reduced?

I have other highly speculative companies I own that interest me. I appreciate you making it easy for me to get a six month review on a stock I owned years ago.

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