\r\n Green \r\n or Mean Returns -
\r\n Investing In The Environment<\/b><\/p>\r\n
By Freddie \r\n Mooche - Axcess Business News<\/i><\/p>\r\n
Every industry \r\n is affected by rules and regulations. Environmental issues are becoming \r\n of greater importance as more and more regulations go into effect. \r\n Cleaner air, water, pesticides even the garbage we throw away is \r\n regulated. Do you think much about it?<\/p>\r\n
Even the oceans \r\n are cause for environmental regulation. The resent oil tanker that \r\n broke in two off the coast of Spain has become world news and threatens \r\n the eco system and industry. Its industry's concern from an investment \r\n perspective as losses can run into the multi-millions, such as the \r\n fishing industries risks off the coast of Spain. I saw on the news \r\n that they stand to loose at least $100 million over the current \r\n strife off Spain's coast line when that oil tanker split in two \r\n and sank.<\/p>\r\n
In 2015 all \r\n oil transport ships are to be double hulled. That's the current \r\n regulations and they're already talking about reforming that act. \r\n That spill is going to force those regulations to be changed and \r\n rapidly. What that means is more ships will have to be built sooner. \r\n But it will also increase the cost of transporting oil in the short \r\n term and that means YOU are going to pay more for heating oil and \r\n gas for your car.<\/p>\r\n
That \r\n brings me to the point of this article. The environment can provide \r\n green investments or mean investments, depending on which end of \r\n the spectrum your on.<\/p>\r\n
The fishing \r\n industry off the coast of Spain is going to suffer, ship builders \r\n are going to benefit, the transportation industry is going to suffer \r\n and then the micro economic effects begin to (pardon my pun) spill \r\n over <\/i>to smaller businesses.<\/p>\r\n
Investing in \r\n environmental companies that are charged with clean up is a pretty \r\n safe bet. But only those that are consistently<\/i> involved are \r\n the safest investment and have the greatest chance for growth; better \r\n green than mean. Go for safe, consistent segments.<\/p>\r\n
What do we mean \r\n by a safe investment? In the environmental industry there are certain \r\n sectors where demand for their services are growing, especially \r\n since regulations began to be enacted to deal with the mounting \r\n waste issues. Two of the safest<\/i> areas we've found are in \r\n the recycling field. Automotive byproducts, tires<\/i>, are one \r\n of the more consistent demands in recycling. It's a green<\/i> \r\n investment! The other is toxic metals and water. Very consistent \r\n demand, another green<\/i> investment!<\/p>\r\n
Axcess Business \r\n News<\/i> looked at two green investments in the recycling industry, \r\n Greenman Technologies, Inc. and KBF Pollution Management, Inc. We \r\n recently interviewed the CFO of Greenman \r\n Technologies, Inc. (AMEX: GRN) in Axcess Business News<\/i> \r\n Inside Wall Street column and had selected it as one of our \"best \r\n picks\" in our Small Cap Corner. \r\n The other company, KBF Pollution Management, Inc. (OTCBB: KBFP) \r\n is also in our Small Cap Corner's \"best picks\" column. \r\n GRN recycles tires and KBFP cleans up toxic metals and waste water. \r\n Two environmental companies in the recycling sector, both with consistent \r\n demand for their services. Green investments!<\/p>\r\n
GRN and KBFP \r\n By The Numbers<\/b><\/p>\r\n
Greenman \r\n Technologies, Inc.<\/i> KBF Pollution \r\n Management , Inc.<\/i> Below is a 3-month \r\n chart of Greenman Technologies Inc (AMEX: \r\n GRN) compared to KBF Pollution management, Inc. (OTCBB: \r\n KBFP) and the Pollution Index (POL).<\/p>\r\n Looking \r\n for the Green<\/b><\/p>\r\n First of all, \r\n \"classifications\" can be confusing. GRN is classified \r\n as \"business services\", yet their S&P Company Report \r\n classifies them as \"capital goods: environmental services\" \r\n and KBFP is classified as \"waste management services\".<\/p>\r\n Trusting \r\n the numbers is another issue. Market Guide portrays the information \r\n to be current, yet based on their recent announcements of sales \r\n and earnings for the 3rd quarter ending Sept 30, neither GRN or \r\n KBFP's is exact. Data often isn't enough, you have to look deeper \r\n to find the green.<\/p>\r\n Clearly both \r\n companies are undervalued. Their industry classifications<\/i> \r\n show very high P\/E ratios. Makes you think your looking at Microsoft's \r\n numbers about 10 years ago. GRN is outperforming its industry average \r\n and based on those averages, if it traded equal to its peer group \r\n the stock should be priced around $3.50 not $2.00 where it currently \r\n trades. KBFP on the other hand has an even higher P\/E ratio for \r\n its industry classification; Market Guide's<\/i> figures appear \r\n to be wrong.<\/i> KBFP announced \r\n on 11\/14\/02 that its sales had increased 50% for the quarter \r\n in comparison to the same period in the prior year and its earnings \r\n were reported to be $273,508 for the period ending compared to $109,700 \r\n for the previous year! So based on that recent announcement, KBFP \r\n is also undervalued. If it traded equal to its peer group the stock \r\n should be priced around $0.10 not $0.06 where it currently trades.<\/p>\r\n Let's examine \r\n why Axcess Business News believes these are safe investments. The \r\n five year earnings per share growth estimates for GRN's industry \r\n classification is 17.67%. Is your sagging portfolio of Telco stocks \r\n giving you that? I don't think so! GRN has debt, yet they've been \r\n very aggressive in expanding through acquisition and only recently \r\n listed to the AMEX from the OTCBB in September. KBFP's industry \r\n classification (5yr earnings per share growth estimates) is 25.93%. \r\n We like those kinds of numbers even better.<\/p>\r\n Both of these \r\n green investment companies have been aggressive and showing stellar \r\n improvements in their sales and earnings. They both have a lot of \r\n debt. But they both have a consistent market and most likely Market \r\n Guide's<\/i> 5-year industry averages are close to reality. Give \r\n those 5yr averages a 50% haircut and you've still got a good return. \r\n Better than the DJIA, certainly better than money markets or certificates \r\n of deposit and there's room for appreciation as both companies are \r\n trading about 50% lower than their industry average.<\/p>\r\n Axcess Business \r\n News thinks that KBFP may be on the same path as GRN. They too are \r\n postured for growth and if they begin to go after acquisitions and \r\n list up to AMEX (remember, GRN was on the OTCBB) it could easily \r\n catch up to its peer group. GRN on the other hand has a head start \r\n and based on its prior growth investors may see more acquisitions \r\n happening.<\/p>\r\n Axcess Business \r\n News will continue to report on the activities of these companies \r\n for our readers as it's sure to interest investors. Members should \r\n watch for an Axcess News Alert in their in-box! If your not a member, \r\n consider subscribing \r\n now and you can get these great market alerts too!<\/p>\r\n <\/p>\r\n Back \r\n To Money>><\/b><\/p>\r\n Give \r\n us your feedback on this story<\/b><\/p>\n","contact":"editor@theaxcess.net","link":"http:\/\/www.theaxcess.net","address":"P.O. Box 970 Carson City, NV 89702-0970 USA","phone":"775.882.1720","parent_id":0,"mime_type":"image\/jpeg","summary":"The environment can provide green investments or mean investments, depending on which end of the spectrum your on.\r\n\r\nThe fishing industry off the coast of Spain is going to suffer, ship builders are going to benefit.","numcomment":0,"fileurl":"\/uploads\/2002\/11\/sinking_ship.jpg","filesize":"2.9 kibibytes","article_url":"\/news\/2002\/11\/22741.php","image":{"original":"\/uploads\/2002\/11\/sinking_ship.jpg","small":"\/uploads\/2002\/11\/sinking_ship.jpgthumb.jpg"}},"attachments":[],"comments":[]}
\r\n Classification: business services<\/i>. In the first row are the \r\n Industry Averages and in the second row are Greenman Technologies, \r\n Inc. numbers.
\r\n Source: Market Guide as of 11\/17\/02<\/p>\r\n \r\n
\r\n Mkt. \r\n Cap<\/b><\/td>\r\n P\/E<\/b><\/td>\r\n Profit \r\n (%) Margin<\/b><\/td>\r\n Price \r\n to Sales<\/b><\/td>\r\n ROE<\/b><\/td>\r\n Sales \r\n per Share<\/b><\/td>\r\n Debt \r\n to Equity<\/b><\/td>\r\n EPS \r\n Growth
\r\n (5 yr.)<\/b><\/td>\r\n <\/tr>\r\n \r\n 404.71<\/td>\r\n 33.60<\/td>\r\n 9.49%<\/td>\r\n 6.73<\/td>\r\n 15.48<\/td>\r\n NA<\/td>\r\n 0.24<\/td>\r\n 17.67<\/td>\r\n <\/tr>\r\n \r\n 30.82<\/td>\r\n 21.51<\/td>\r\n 4.97%<\/td>\r\n 1.09<\/td>\r\n 93.04<\/td>\r\n 1.84<\/td>\r\n 2.35<\/td>\r\n NM<\/td>\r\n <\/tr>\r\n <\/table>\r\n
\r\n Classification: waste management services<\/i>. In the first row \r\n are the Industry Averages and in the second row are KBF Pollution \r\n Management, Inc. numbers.
\r\n Source: Market Guide as of 11\/17\/02<\/p>\r\n \r\n
\r\n Mkt. \r\n Cap<\/b><\/td>\r\n P\/E<\/b><\/td>\r\n Profit \r\n (%) Margin<\/b><\/td>\r\n Price \r\n to Sales<\/b><\/td>\r\n ROE<\/b><\/td>\r\n Sales \r\n per Share<\/b><\/td>\r\n Debt \r\n to Equity<\/b><\/td>\r\n EPS \r\n Growth
\r\n (5 yr.)<\/b><\/td>\r\n <\/tr>\r\n \r\n 408.31<\/td>\r\n 77.94<\/td>\r\n 2.78%<\/td>\r\n 1.38<\/td>\r\n 5.19<\/td>\r\n NA<\/td>\r\n 1.76<\/td>\r\n 25.93<\/td>\r\n <\/tr>\r\n \r\n 10.17<\/td>\r\n NM<\/td>\r\n -25.01%<\/td>\r\n 1.79<\/td>\r\n -24.33<\/td>\r\n 0.04<\/td>\r\n 0.49<\/td>\r\n NM<\/td>\r\n <\/tr>\r\n <\/table>\r\n