“Rogue MIT Scientists’ Billion-Dollar Energy Cure”

by Travis Johnson, Stock Gumshoe | August 15, 2011 2:11 pm

Also being pitched as "Idaho's secret nuclear meltdown" (for their expected work at the Idaho Falls test reactor)

These are the kind of teaser ads that always bring a smile to my face — top secret technology from “rogue” scientists, unknown breakthroughs that will change the face of the world and make us rich, that’s what teaser-land is all about!

And certainly Nick Hodge[1] knows that — all the publishers use the same copywriting techniques in their ads, because that’s what gets us excited and that’s what works. This time around the pitch is for Alternative Energy Speculator[2], which Hodge edits for Angel Publishing[3], and the idea this time around is that these scientists are going to change the energy business. Here’s how he puts it:

“Developed in a Boston research facility, one of the most powerful alloys on earth promises to revolutionize the nuclear energy industry…

” * The alloy was originally used by Manhattan Project scientists

” * Sales up more than 2,000% in the past five years

” * Potential to control nuclear fuels industry within the next ten years

” * Created a nuclear fuel that eliminates meltdowns

” * Created a super metal that has NASA, the U.S. Military, and computer manufacturers stalking the sales department day and night; they all want to take advantage of this rare metal’s unique properties and what it can do for their products – and their bottom line”

Apparently Nick Hodge actually went to visit this company for a meeting, which gives us some more clues …

“The meeting kicked off in the executive suite of the company’s new 63,000 sq. ft. manufacturing facility just outside of Boston. The paint on the walls hadn’t dried yet. And already there was talk of an urgent need for expansion.

“Inside, I would hear sensitive information never before shared with the outside world – not the press, not even members of their own engineering department knew all the details behind this company’s operations.

“I was meeting with the CEO, Anthony, and his number one: a Massachusetts native known around the building as ‘Ray.’

Well, being a Massuchusettsan myself these days I thought that might give me an edge, but no — don’t know anyone named “Ray” in the neighborhood. Dangit. Seems like a cool guy — after all, Hodge says he came up with something to “break the laws of physics” and bring in “more orders than they can handle.”

So we’ll need some more clues — and, thankfully, they oblige. They tell us that the key to this breakthrough is Beryllium, here’s some of the beryllium[4] excitement they share:

“… one element – an element 99% of the population’s never even heard of – stood out head and shoulders above the rest – even more so than uranium[5]…

“It’s called beryllium.

“With its unique properties, the applications for the metal appeared so vast and revolutionary that, at the time, they bordered science fiction:

“Half the weight of titanium and twice as stiff
“Transparent to X-rays
“Doesn’t spark
“Non-magnetic
“Doesn’t rust
“Extremely low neutron absorption rate”

And the connection to the nuclear industry? I thought you’d never ask! Here’s what they say:

“The team also observed that beryllium is an excellent absorber and conductor of heat, and which could have huge benefits to the nuclear industry. In fact, if beryllium oxide were added to nuclear fuel it could even help prevent a nuclear meltdown.

“The Japanese meltdown, Chernobyl, and Three Mile Island would’ve never happened!

“It’s the sort of Cinderella story that mainstream media outlets like CNBC won’t be able to resist talking about over the coming months… launching the share price into the stratosphere while your utility bills plummet.”

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So we’re told that because of the continuing huge need for nuclear energy, and the fact that beryllium, when mixed with uranium, makes plants 25-50% more efficient, prevents meltdowns, and makes spent uranium less dangerous, the use of beryllium is likely to be a requirement for plants in the future.

Did Beryllium as a fuel component come out of nowhere? We’re told that what’s important is BeO, beryllium oxide, and that it came from a surprising source:

“…surprisingly, this brilliant idea didn’t come from the likes of MIT or Caltech…

“Rather, it formed as a joint project by two universities better known for their football teams than scientific prowess: Purdue and Texas A&M.

“Funded by the same company I’ve been telling you about, these two universities worked to create a hybrid fuel capable of extending the life of uranium while protecting plants from ever melting down.

“They knew after initial tests with their hybrid fuel that they were on to something big…

“But they had no idea that their discovery would potentially change the face of nuclear power forever.”

And it’s not just nuclear power that we’re talking about, apparently — this company did something dramatic in developing a new era of “space age” material … in Hodge’s words:

“So, what is it about this company that’s so exciting?!

“As you might expect, the scientist in charge didn’t merely invent the ‘next carbon fiber’ out of beryllium. Not this group.

“In short, thanks to a very secret process – one they could only partially reveal to me – they created perhaps the lightest, strongest, most vibration-dampening super alloy humanly possible.

“As the CEO summed it up: ‘We created a material that scientists said couldn’t be created and use it in a way that they said couldn’t be used.’

“It’s bold. It’s ballsy…

“And It’s So Cutting-Edge You Have to Build Atom by Atom to Beat It!

“In other words, using this one-of-a-kind material, engines could run hotter, cars would travel further, computers could process faster, satellites could aim straighter, and drones[6] could carry heavier payloads than ever before…”

This apparently makes all kinds of stuff possible — better military drones and missiles, faster computer hard drives, better circuit boards … which is part of what is supposed to make us rich:

“It’s these unique features – and the orders that are now pouring in – that has the CEO convinced revenues will increase from $5 to $10 million a year to $200 to $500 million a year in short order.

“That implied (at a minimum ) a 1,900% increase in sales… at a maximum, it’s closer to 10,000%.

“What do you think a 10,000% rise in revenue will to this tiny company’s stock?”

And the company also has lots of access to raw materials — we’re told that they have already “secured some of the world’s largest potential deposits of beryllium ore” and could be “among the largest suppliers, from the ground up.”

And since everyone is patent-obsessed lately, Hodge adds that they “own 100% of the intellectual property rights.”

So that oughtta be enough fuel to feed into the mighty, mighty Thinkolator, no? Indeed … turns out that this little Massachusetts company is … IBC Advanced Alloys (IB in Canada[7], IAALF on the pink sheets)

And be careful, it is TEEENSY. The market cap is less than $50 million, and on a normal day it only trades a couple hundred thousand dollars worth of shares, so ANY interest causes the stock price to go all kerfluggly. That’s happened in the past whenever the stock has been teased, I thought the whole thing sounded a bit familiar so I looked it up and yes, the Alternative Energy Speculator folks also touted this pick back in February of 2010[8], and you can see the impact on the chart:

[9]

That more recent spike, in mid-May, could have been from Byron King[10], who has also touted this stock before for one of his newsletters, or it could have just been attention from the opening of their new manufacturing facility or something along those lines (they issue a lot of press releases). And you can see on the far right of the chart that this new promo campaign by Nick Hodge has already helped the price climb from the 16 cent neighborhood up to 22 cents. I can’t write about it to all of you without also having an impact on the price, even if I don’t tell you that I think it’s a buy or a sell (I don’t have an opinion on the stock, just to be clear — I’m just pointing you to the solution for Hodge’s teaser).

So I can just tell you to be careful, there’s very little way for me to know, especially given the very limited research I’ve done, whether the company should be worth 10 cents or 50 cents (or far more or far less) per share right now — it’s all about attention and new customers driving new potential revenue streams, and new investors getting excited about the stock.

You can check out the company’s promotional materials on their website here, including the latest investor presentation[11] — and that’s probably all the optimism you need, they are at least lifting revenues (revenue increasing 50% year over year). It’s certainly possible that they’re at an inflection point where demand for their alloys or perhaps increased use of beryllium oxide as a nuclear fuel additive will drive them into profitability, but it’s far from guaranteed. For the pessimism I always like to double check the financials, and they have a fairly standard (for a development stage company) “going concern” section in their latest quarterly report[12]:

“At March 31, 2011, the Company had not yet achieved profitable operations, had accumulated losses of $24,731 since inception and expects to incur further losses in the development of its business, all of which cast doubt about the Company’s ability to continue as a going concern. The Company’s ability to continue as a going concern is dependent upon its ability to generate profits from its operations to obtain financing to meet its obligations and repay its liabilities arising from normal business operations when they come due.”

That “accumulated losses” number is in thousands, I’m pretty sure, so it’s an accumulated loss of about $25 million — which means they shouldn’t have to worry about paying much corporate income tax anytime soon. They have done equity raisings pretty much every year going back many years now, with the latest one being eight million dollars just recently, so they ought to have enough cash to keep them going for a while — at the current pace they’re losing just under $3 million/year, though with the new facility and new initiatives they may be investing more.

And in case there was any doubt, yes, they did just open a 63,000 square foot manufacturing facility in suburban Boston, and they are doing deals with big high-tech manufacturing companies who they won’t name, and they are looking at all the typical customers for gee-whiz new alloys and technologies, including aerospace and defense. And they are going with vertical integration — they have exploration projects and mining projects in Brazil[13] and the US, including a major historic beryllium mine, and they have a supply contract with the Kazakhstan nuclear authority Kazatomprom, which runs the Ulba metallurgical plant that supplies much of the world’s beryllium (along with other nuclear fuel).

And yes, there is a “Ray” — it sounds like they must be talking about Ray White, co-inventor of the Beralcast technology that I suppose must be their “break the laws of physics” stuff, and one of the named folks on the patent.

And beyond that, well, if you know whether this will really be a “billion-dollar energy cure,” I hope you’ll share with us with a comment below.

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