“The Forever NanoBattery: Makes old batteries obsolete and investors wealthy”

By Travis Johnson, Stock Gumshoe, April 2, 2008

This one has come up in questions from readers quite a few times over the past few weeks that it’s been circulating, and the shares have already moved up a little bit with the company trying to get some press coverage tomorrow as they demonstrate their technology. So now seemed like a good time to mention them.

The teaser is from Untapped Wealth and editor Tim Fields, they’d like $99 from you for the special report and a subscription to the newsletter … Untapped Wealth isn’t covered by Hulbert and I’ve not seen their long term performance figures, so I have no idea whether or not they’re any good. But I do know you don’t need to subscribe just to find out the name of this “forever battery” company — not while the Gumshoe is on the case!

One small point gives me pause: Fields takes credit for recommending New Oriental Education (EDU), which we’ve seen teased several times in the past year, about a year ago, which is fine and probably true … but in so claiming he says that “The last recommendation letter I sent out turned $75,000 into $225,000 in less than 12 months!”

I don’t know how he tallies his performance, but the last two teaser stocks that I’ve sleuthed out that came with his name, both of which were sent and, one assumes, written within the past year, well after the EDU rec, would have lost money by my calculations: E-House (EJ) and Clearwire (CLWR). Not a lot of money, I admit, which might be a moral victory in this market, but the claim that the “last letter” he sent provided 200% returns rings a little thin with me.

But back to that forever battery … the hyperbole is strong within this one, my friends:

“It’s like getting a royalty check EVERY time someone buys a battery – anywhere in the world!” Tim Fields

… is how the ad begins — how often does someone quote themselves in the headline of a letter to add veritas? Odd.

And then goes on to say that …

“The Most Startling Innovation In 208 Years Is About to Be Unleashed On the Market… And once it is, you’ll never plug in your cell phone, iPOD, or laptop again!”

The ad is teasing a company that’s trying to develop and market a new battery design that relies on nanotechnology, which certainly doesn’t narrow the search down to a single company (there are at least dozens of high profile researchers working in this area both in large corporations and at Universities, and many several smaller companies counting on making the next breakthrough in this area, a few of whom are public)

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So what do we learn specifically here?

First, the case is made that everything from mobile electronics to transportation is clamoring for a better battery. That we can all agree on, and we’ve seen battery companies teased before (like Ener1 for their version of the lithium ion battery for automobiles). Clearly, we’re not all going to have phones that are much smaller (like Qualcomm’s April Fool’s day HandSolo, perhaps?), or electric cars parked up and down our streets, until batteries get smaller, more long-lived, faster, and safer (no one wants their car to catch fire).

The tease is, of course, that Tim has discovered the company that can best provide deliverance from this widely accepted problem. And that’s a standard investment marketing ploy that we all see nearly every day — build up a problem that everyone has heard of or understands, explain why it’s so important to solve that problem … and then sell the one solution you have as the only solution, without mentioning the other possible solutions or competitors. His marketing letter is here if you want to whole spiel about battery evolution.

Not to cool your jets or anything — maybe this one is the “real deal” … let’s continue …

The promise of gains is more dramatic than most other stocks we’ve looked at — Tim is “so excited about this little company and … expecting its shares to multiply 3,600% within the next 12 months.”

So — does anyone want a three thousand percent gain? Anyone? Good enough? What’s the sweet spot — would it be better if he promised 500% gains and seemed more realistic, or 30,000% to really knock your socks off? Tough call.

So we’ll settle for the 3,600%. Let’s see how it works out for him.

So the special report is called “The Forever Battery: Making Today’s Batteries Obsolete… And Its Investors Wildly Wealthy”

And by way of teasing the details, here’s what we get:

It’s a whole new battery design, not just a new chemical makeup for the standard design.

It has relied at least in part on military funding for R&D, apparently part of a push after Gulf War I to make a better battery after some battery problems and failures in that conflict.

He calls it the “world’s first nano battery” and says it’s ready for production.

Of course, we’ve got a quote from the reputable news media to add some weight to Tim’s claims: ‘Christian Science Monitor says, “nanotechnology…has allowed the battery industry to begin to catch up with the electronic industry’.”

And here’s another excerpt that talks about what this battery company’s technology really offers:

“So how does this “forever battery” work?

“Simply put, its design keeps internal chemicals from mixing together – which is the reason even a dormant battery looses power.

“It also controls the battery’s internal reaction by isolating the electrolyte when power isn’t needed (which means it’s losing ZERO power when you’re not using it!)

“This is HUGE for manufactures because their batteries now have an infinite shelf life!”

So that makes for probably enough information for the Gumshoe to go on … the Thinkolator 5200, recently upgraded and glitch-free, spins quickly to action and tells us that this is…

mPhase Technologies (XDSL, trades over the counter)

This used to be primarily a DSL company, as you might suspect from the ticker symbol, but apparently got into the battery business a while back in a joint venture with Bell Labs/Lucent/Alcatel Lucent, or whatever they’re called today. The division that is developing the battery is called AlwaysReady, and they call it a “smart” battery. It is clearly focused on military and small consumer electronics applications.

The company’s own description of itself is as follows:

“mPhase Technologies Inc. (OTCBB: XDSL), through its wholly owned subsidiary AlwaysReady, Inc. is focused on developing and commercializing a new battery technology based on a well patented phenomenon known as electrowetting which provides a unique way to store energy and manage power that will revolutionize the battery industry.”

So … I’m no patent lawyer or engineer, and the only patents that are actually in mPhase’s name are for various DSL products and technologies, but they do say that core researchers on their team have developed at least ten patents for this nanobattery technology — one assumes that mPhase owns or has licenses to all of the relevant technologies, so hopefully that’s true.

Company officials reportedly said last fall that “if properly marketed” the battery could get 3-5% market share in the reserve and advanced battery markets within a number of years as their first stage of development. That’s a $1-2 billion market, apparently, though I haven’t verified that. So, take a wild guess and say $50 million in sales at some point in the next several years? That would certainly be significant for them, since, coincidentally, $50 million is just about the market cap of the entire company.

The Christian Science Monitor article that they quote is here, it’s about a year old — the way it’s written, it emphasizes the fact that mPhase’s technology is focused on battery shelf life, allowing batteries to keep their charge indefinitely when not in use. They also tout that they were mentioned in a Credit Suisse analyst report about nanotechnology, that report is here (pdf file) if you’re interested.

The careful reader might come away from reading both of those pieces and conclude that there are a whole lot of companies working in this area, but that there’s certainly no consensus about where technology or nanotechnology is going to take the battery in the next decade — maybe this mPhase technology will be significant, maybe one of the other companies or researchers in this space has something much better.

And if marketing is going to drive the success of this company in the next few months, they’ve certainly got a head start — they issue press releases at least as frequently as I issue self-important third person references (that’s pretty often for the mighty Gumshoe, as you may have noted). The latest one is for the first ever public demonstration of the battery, a demonstration that for God knows what reason is being held at AJ Maxwells in Manhattan. That’s a steakhouse. I don’t know why.

I mean, I do know why it’s a steakhouse — I don’t know why an advanced battery demonstration is taking place there. Do they need to ply investors and reporters with meat to get attention?

You can certainly read all their press releases from their website (their audio barrage starts immediately, check your volume), and view a video of their gee-whiz stuff, and read lots of other supporting information.

The stock has been up and down in the last year or so, driven no doubt by news releases and perceived developments and successes or failures in testing. They’re also going to need some serious partners to develop any capacity, so perhaps news of that has driven the price up or down recently as well. The shares are around 12 cents at the moment, after almost doubling after this particular marketing campaign and the company’s own PR machine ramped up for this upcoming demonstration, but the shares were much higher a couple years ago (I assume those higher prices in the further past were when they were concentrating on DSL technology, but perhaps they were previous iterations or future promises about the “forever battery.”)

So … this battery has been in development and testing for at least a decade. Is now the moment to get on board, and is this the breakthrough battery that’s really going to make a difference?

I’m a little bit intrigued, but I’m certainly not an expert on battery technology and don’t know how many carcasses of advanced battery companies we’re standing on as we consider the viability of this firm. I am fairly certain that his must be the company Tim Fields is touting for Untapped Wealth, but I’m equally certain that I’d like to know more before I put my money into it.

And they’re clearly still in the very early stages, even after 14 years of development, so I imagine that if this is really going to go up by 3,600% there might be time for a bit of patience. All the talk is still about what this battery could do, and the applications that might work, and the R&D contracts that they’re still winning. Nothing that I’ve seen yet about actual products, or deals with manufacturers, which would be the next very big step, and until there’s something more to sink your teeth into there’s no way for me to even guess at what a fair valuation for the company might be. Remember, even if you’re poky and patient you could still let it double a few times before you get on board and get an easy 30 times your money if it really is going to hit that 3,600% return from today’s price. And that’s assuming that it moves up in a straight line, starting tomorrow … which has happened, roughly speaking, never.

I would certainly classify these tiny OTC shares as a gamble — whether that’s what you’re looking for, and whether this particular company is the best gamble in the space? Well, as long as it’s your money, it’s your call. They are a real company, I assume (though don’t know for sure) that they’ve got either ownership or long term access to those battery patents they claim, they say they’ve managed to successfully manufacture the nano membrane in a commercial facility, and they are demonstrating something tomorrow, but that’s all I can say with any confidence. Oh, and they have almost no cash on hand, but also not all that much debt (only 1.6 million). Perhaps the demonstration will be key to raising more capital, since it’s certainly going to be a while before they become profitable. If they become profitable.

They’ve demonstrated this technology before in conjunction with Lucent, a couple years ago, but all that battery did was prove the concept and light a single LED. Hopefully this demonstration will be cooler — maybe they’ll fire up a batter powered blender and make margaritas for the crowd.

Feel free to share if you’ve got a feeling for this one. Or better yet, have done any research on them and their competitors.
And if you go to the demonstration on Thursday, let us know if you get any free meat.

Happy Investing, everyone.

full disclosure: I do not own shares of any company mentioned here, and will not trade in any investment mentioned for at least three days. I have received no free steaks, chops, or other cuts of meat for writing about this company.


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G IMBURG
Guest
G IMBURG

This is one of my favorite small stocks. The nanotechnology idea is high tech. I think this stock could fly high because of all of its advantages. The ARMY is funding the technology in a phase II program. I bought 5000 shares @.04 and hope the stock keeps on going.

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Dividends4Life
Guest

Now that one really gets your attention. how many times have we ran out of battery while on a call or forgot to charge up our PC batteries before a long trip. I guess we can dream!

Best Wishes,
D4L

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Peter Deacey
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Peter Deacey

This sounds like the basic science has been proven. However it is a long way from laboratory samples to assembly line finished product. Reading carefully this does not promise a battery with infinite operating life; after all the laws of physics still apply even at the nano level. Because there is no deterioration of power potential while there is no demand this would significantly increase operating life ( but not forever ), and obviously shelf life would be very much increased. The main issue here is the developement of manufacturing facilities to efficiently assemble this technology into existing battery packages.… Read More »

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James
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James

Thanks for the great article, your artciles always give plenty to think about and are my essential investment related reading every morning. Here are my thoughts on this company (well, the industry really, I don’t know much about the company itself). The need is real, battery size and battery life is a real problem in consumer electronics. As you point out though, there are plenty of large companies and lots of researchers at universities working on solutions. Certainly shelf life is an issue, but is it the biggest issue? Many groups are working on batteries that will recharge faster (think… Read More »

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Gravity Switch
Admin
👍7

James and Peter, excellent points from both of you and good food for thought — thanks very much.

Gravity Switch
Admin
👍7

In my experience, what usually happens in these cases is that the pink sheets holding would be converted automatically by your broker into a NYSE position with the new ticker — but I don't know if that necessarily happens every time, I'd check with your broker.

Kay
Guest
Kay

Has been pumped by Lebed over the past 10 days. Yesterday’s (1-Apr-08) breathless email: XDSL is going to shock the world Thursday morning at 9AM when they make Battery History! After XDSL successfully transferred certain processes critical to the manufacturing of its Smart Nanobattery to a commercial contract foundry facility last week… they successfully fabricated nano structured separators which are critical to the production of the Smart Nanobattery at the contracted commercial foundry. Then today it was announced that XDSL has advanced the art of coating nanostructured surfaces leading to improvements in the Smart Nanobattery technology. Thursday will be one… Read More »

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Jason
Guest
Jason

ARM doesn't sell the chips, they license the IP (processor design + other logic) that other companies integrate into chips.

nibor
Member
👍0
nibor

Well then, in the latter case of your scribe I guess I should go and empty my life savings and invest it in this unproven statement from you. I’m on my way to the bank.

j bailey
Guest
j bailey

This is legit deal as they have encapsulated the electrolyte for infinte shelf life! Thinkolator this is revolutionary. The ultimate effect could be exponential especially as new applications, which were not possible are released from the drawing boards!

DLS
Guest
DLS

Shelf-life shmelf-life. What’s the big deal? I have 5-years-old alkalines in a kitchen drawer that are still fine. What I want is a battery that holds more juice and weighs less.

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NeedHelp
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NeedHelp

Has anyone heard of S&A teaser John & Helen Scott`s “Drive-Thru Retirement Project”

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Gary Olin
Guest
Gary Olin

Right on!! In early 2008 he was saying "SOFT :LANDING". The BRICs were going to bail he U.S. out of its bubble. Sure.
Suddenly his website has been bombarding me with panic articles. I keep "unsubsicribe" ing but they keep coming under new titles. The guy must be desperate.

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Mastro
Guest

at $0.11 a share can you afford not to take a chance on this tease?

Gravity Switch
Admin
👍7

Mastro, that’s of course a popular feeling about these kinds of super-low-cost stocks … but do keep in mind that 11 cent shares are much, much more likely to go to zero (or near zero) than are $11 shares. And if it drops by a few cents that’s a 30% haircut, so you may well be right in this case (I sure don’t know), but the fact that it’s only 11 cents doesn’t mean that it’s lower risk.

Gravity Switch
Admin
👍7

And NeedHelp, I’m just about done writing up that teaser — it will be at the top of the site shortly, probably by Noon.

Gravity Switch
Admin
👍7

Unless I misremember, it was that it had nothing to do with buying stock IN MINERS — RGLD is not a miner. Another teaser technicality 🙂

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A Ghuman
Guest
A Ghuman

Well, just to point something out, their test was successful, but the share price is actually down today. Seems like the market does not share the companies’ enthusiasm for the demonstration.

Mastro
Guest

Gumshoe – point taken, 30% is still 30%. But if I had to sacrifice that much I would rather sacrifice 30% of XDSL then 30% of my Visa shares.

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Bret
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Bret

Perhaps it is my cursory look at this, but it would seem to me that the discussion is not about a battery that runs forever without charging. To borrow a line: “You can not change the laws” of physics kiptin! Batteries work though an electrochemical process. This means that a chemical change occurs and for each atom that is changed in the battery, one chemical loses an electron, and one gains one. This gaining and losing has to go somewhere. It is prevented from going though the membrane that separates the two parts of the battery (one part that loses,… Read More »

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cindy
Guest
cindy

Thanks StockGumshoe…I’m waiting for your write-up, re: “Drive-Thru Retirement Project”. Do you have any write-up regarding the “China Lake Energy” teaser from Daily Wealth.

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Richard E. Lowman
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Richard E. Lowman

Still waiting for any comments on Michael Cohen are they a scam
Richard

Gravity Switch
Admin
👍7

Sure sounds like it to me.

Cocoon
Guest
Cocoon

Would Kay care to describe what transpired at Maxwell’s today?

John
Guest
John

I do not see any pre post market action.

cindy
Guest
cindy

Sorry Stockgumshoe..the “China Lake Energy” teaser from Penny Sleuth, March 20 issue. Thanks…

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TV Guy
Guest
TV Guy

What is “funny” (not really) about investment in stocks is the fundamentals….and TRUE fundamentals as outlined by Bret above….bear no direct relationship to the value and direction (up or down) of a particular stock. Drives one crazy, no? In these cases, what is at play is hype and excitement …which in turn drives VOLUME. That volume increases…stock goes up…and bango we all made money. Get this: even if the stock in question is bogus, half-true or totally false !! Watch the volume trading on these…play down the fundamentals (unfortunately).

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Charles Walter
Guest
Charles Walter

OT This forum needs some direction. I wish I could present a good tease, but only can offer a stock with good potential. May I suggest you perform DD on Amerityre (AMTY). The company is about to become profitable. It makes tires, but ones that offer cheaper price, greater safety, better gas mileage, can be produced faster and can run after being punctured. check the company out.

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Gravity Switch
Admin
👍7

There are plenty of folks (and some funds) that try to do this kind of “dividend capture”, though they usually hold for the required period (60 days? I'd have to look it up) to get the lower dividend tax rate. The churn does generate a lot of taxable events, and the friction of trading costs, but it can certainly sometimes work to boost your dividend payout a bit, hopefully more than the associated costs. I'm not crazy about most of the funds that do this, but perhaps it's possible for an attentive individual to do better.

Jason
Guest
Jason

It's also not unheard of for a stock's price to increase prior to and decrease following the dividend date (though this is far more common and drastic with a one-time payout than regular payouts). Be careful that you're not paying for that dividend with a drop in stock price.

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SoGiAm
Member
👍11391

AAPL, DTO- – -AWRE and ENZN also have similiar ‘irregular” (somwhat recurrent?) dividends.
Long AWRE, ACHN, ARTH, ARWE, ATNM, CTIX, NBY, PENC, XENE, and may re-enter position in ENZN not CONX
Ditto on lack of dry gunpowder (setting up Interactive Broker Acct), waiting for confirmation). Travis thanks for correcting me on CONX. Have you made a decision on FUIT or SGS-SPREADs?
Best-Ben

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spreadtrader
Guest
spreadtrader

Try AOD or AGD, but you still have to buy them low and preferably at a discount……
http://www.alpinecef.com/index.asp

Darren
Guest
Darren

Joe, Great idea if you like to pay more taxes. The problem is like this: You buy XYZ stock at $10 a share. It then pays out a $1 dividend. XYZ will immediately drop to $9 a share ($10 per share minus the $1 dividend). You will pay taxes (and not have favorable treatment) on the dividend. Therefore, you will pay the commission, taxes on the dividend (although you could take the short-term loss on the reduction in stock price, if you sell at a loss). BTW, there is no guarantee that the price will come back after the ex-date.… Read More »

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John Smith
Guest

This company is heading towards commercialization and in a very uniwue way. They are the only company I am aware of with a battery with these kind of charaterstics. The US Army validated it, Lucent Bell LAbs validated it , and most impressive and recent Credit-Suisse a world leading investment banking firm. This Smart NanoBattery sounds great and now that they are gettijng in position to market it , this could be well worth the risk/reward. The elctronic batter market is worth $55 Billion CEO of the company said at today’s demo. I was really impressed and it was a… Read More »

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Jim
Guest
Jim

I have followed this one for years. Pump and dump stock the entire time. Guys like this http://www.lebed.biz have been paid good money to manipulate it. Beginning of each year.

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Gravity Switch
Admin
👍7

Thanks for the great comments, folks. And John, not to quibble, but Bell Labs helped to develop it, the Army has funded some of it’s R&D, and Credit Suisse has mentioned it. None of those sounds like “validation” to me, though we could quibble about what that term means. The science may have been validated, in my mind the investment thesis is a bit short of validation yet, which is certainly why it’s such a cheap, speculative OTC stock that markets itself with great enthusiasm.

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Big Mo
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Big Mo

To answer Richard Lowman: Please see the Gumshoe archives for an entire write-up on Michael Cohen, Merl and his Doubling Stocks website.

G IMBURG
Guest
G IMBURG

I have already said I like xdsl not withstanding the hype for several reasons. First, their technology could ultimately swallow the entire market once they go into full production and I suspect they could end up supplying the entire US military with this technology. The battery has been proven to work. I dont mean to pump this stock because I own it, but my scientific sense tells me this battery is special. The entire world could use this kind of technology. It takes a stock like this to go up 1000% about 3 years and I suspect you will never… Read More »

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Myron Martintakeprofits@rogers.com
Guest
Myron Martintakeprofits@rogers.com

I like the Gumshoes sober reality check, however on a risk reward basis a few hundred dollars is not much to put at risk considering the potential. Certainly not a stock to go whole hog on, but whether the HYPE leads it higher or the actual technology proves out, I feel confident people who don;t get greedy, I.E sell half on a double etc. will make money on this one, but what do i know, it COULD also go to zero nd prove to be a complete dud, only TIME will tell. Myron

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spreadtrader
Guest
spreadtrader

WVVI………………………..one-of-a-kind farmland after my own heart, only 3.50 a share and holding together quite well in spite of recent market volatility. Check out the chart.

otterbegood
Guest
otterbegood

I have certainly been looking for this one, too. So far, all I found was London based companies buying farmland. And something called the American Farmland Co. that I can't find in any market listing. Wish "THE SHOE" would ferret this one out !! I DID find a nice company that makes grain drying equipment in Canada, and other parts to go with the process. Pays a monthly divvy, Canadian, so hold it in a taxable acct. —AGGZF on the pinks, pays about 7%. I don't think Ferris means Willamette vineyard acreage but tell me more why you think that… Read More »

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JackB
Guest
JackB

In the nano battery field my money is on Altair Nanotechnology Inc

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