Worldwide Energy (PINK:WEMU)

Added to the GeoSpecial list on December 3, 2009 @ $5.20
 
Catalyst: Significant contract news and financial guidance indicated that WEMU was on its way to a swift turn around in its operations.
Peak performance: Reached a high of $6.25 on March 16, 2010
Current Price: $3.95
 
Current road block:  The Company threw us for a loop on January 27, 2010 when it announced that it was issuing shares for expansion purposes. While the move may increase margins and add capacity, it also resulted in a whopping 47.3% increase in WEMU's share count (94.5 % if warrants are included). Thus, we are postulating that dilution could be an issue in the near-term; Company has yet to hit its financial targets since we have followed the company; Company has not issued full year guidance despite the existence of EBITDA make good targets tied to its recent financing (WEMU does expect to issue guidance upon the releases of  its 2010 second quarter report); Constant amendments to its filings for issues as simple as share count; Lack of non-GAAP EPS presentation in its press releases;  Investor sentiment will be tied to oil prices; The company also indicated that it sees 2010 second quarter net income to be conservatively higher than the 2009 comparable period.  Without an EPS target we need to be mindful of dilution.

Remains on the GeoSpecial list, on a thin line.   Despite dilution WEMU was still able to grow its EPS in its 2010 first quarter. Still, issues of near term dilution will weigh on our minds. We are also tepid due the financial clarity concerns.

Liquidity seems in tact:

"We will continue to focus on the expansion of our renewable energy division by the continued development of our newly established solar factory in Ningbo, China as well as the continued quality enhancements of our solar module brand, "Amerisolar".  Additionally, we intend to develop the U.S. solar module market and plan to expand our operation in this market. We believe that the renewable energy division offers us our greatest growth and profit potential in both the present and foreseeable future. We presently have enough liquidity to meet our expansion plans. However, depending on growth the Company may need additional funding in the future."