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Opportunity Research
TRADE ALERT
 

We are issuing a trade alert on a NASDAQ company we have followed since 2011 that not only is primed to move much higher on the heels of M&A, but could be aided by the near term commencement of a short squeeze.

Fundamentally, company revenue could reach the $14M - $16M range this year, up from a few hundred thousand in 2013 and could achieve $25M+ in revenue next year, aided by recently closed and pending M&A. The stock, which has been the target of naked short selling, is primed to be driven to new levels by short covering in response to pending events, taking the fast-growing company to new highs.

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FORCEFIELD ENERGY, INC.

M&A to Drive Huge Revenue Growth; Major Short Squeeze in the Cards

Rob Goldman
rob@goldmanresearch.com

August 13, 2014
 

FORCEFIELD ENERGY, INC (NASDAQ - FNRG - $5.50)

Price Target: $7.00 Rating: Speculative Buy
 

COMPANY SNAPSHOT

KEY TAKEAWAYS

ForceField Energy Inc. and its subsidiaries comprise a global company whose products and solutions focus on sustainable energy solutions and improved energy efficiency. ForceField is a distributor of LED lighting products for a number of premier LED lighting manufacturers; and through its subsidiary American Lighting, is an award winning-contractor that has completed lighting installations for numerous high profile concerns in a variety of industries. ForceField is also a licensee of modular, heat recovery systems that convert waste heat into clean electricity. Its patented technology is based upon the Organic Rankine Cycle (ORC) and uses proprietary, multiple-component fluids that are environmentally sound.

 

KEY STATISTICS

 
Price as of 8/12/14 $5.50  
52 Week High – Low $6.98 – $4.44  
Est. FD Shares Outstanding 16M  
Market Capitalization $88M  
3 Mo Avg Vol 14,500  
Exchange: NASDAQ  
 

COMPANY INFORMATION

Forcefield Energy, Inc.
245 Park Avenue, 39th Floor
New York NY 10167

www.forcefieldenergy.com

Phone : 212.672.1786
Email : info@forcefieldenergycom

Conclusion: While FNRG’s stock has been relatively flat for the past few months, two near term events could dramatically boost FNRG’s share price.

Catalyst #1: The first upcoming event is the closing of a critical acquisition in the energy efficiency products and services space that should contribute $10M+ in annual revenue. ESCO Energy Services has a big presence on the East Coast and complements the fast-growing American Lighting subsidiary which has a footprint on the West Coast.

Once closed, FNRG could record an estimated $14-16M in revenue this year compared with a few hundred thousand in 2013. Next year, we preliminarily forecast sales of $25M+ with greater operating efficiency through high profile projects.

Catalyst #2: Buyins,net, which specializes in short sale trading statistics, just released a report which indicates 855,000 shares have been shorted since May 2013.  An average of 28% of all daily volume each day is short selling, much of it naked short selling.   

The report notes that a short squeeze could begin once the stock breaks above $5.53 which we believe could occur in conjunction with the ESCO acquisition closing and/or the closing of new business.

Looking Ahead: On top of previous guidance over $111 million in revenues could be generated over a multi-year period if the current LED and ORC projects under signed initial agreements, Letters of Intent (LOI), bids and trials are successfully financed and completed. With a series of positive events on the horizon, it is likely that a huge run in the stock could occur as short sellers who previously did not give credence to the FNRG model, frantically cover their positions.

Recent Trading History For FNRG
(Source: Stockta.com)

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Senior Analyst: Robert Goldman

Rob Goldman founded Goldman Small Cap Research in 2009 and has over 20 years of investment and company research experience as a senior research analyst and as a portfolio and mutual fund manager. During his tenure as a sell side analyst, Rob was a senior member of Piper Jaffray's Technology and Communications teams. Prior to joining Piper, Rob led Josephthal & Co.'s Washington-based Emerging Growth Research Group. In addition to his sell-side experience Rob served as Chief Investment Officer of a boutique investment management firm and Blue and White Investment Management, where he managed Small Cap Growth portfolios and The Blue and White Fund.

Analyst Certification

I, Robert Goldman, hereby certify that the view expressed in this research report accurately reflect my personal views about the subject securities and issuers. I also certify that no part of my compensation was, is, or will be, directly or indirectly, related to the recommendations or views expressed in this research report.

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