It had been years since I looked at Westport WPRT 0.00%↑ . Even though the EV model looks like the answer for passenger cars, there’s a case for gas and hydrogen for larger cargo vehicles like trucks.
The stock has been in steady decline, and when it got below cash per share, it prompted me to take a look. Their latest offerings looked promising, and they have pilots with some important OEM truck companies.
On the surface, I thought that perhaps they could execute a turnaround in the business, which could be a good investment at these levels.
As I started my research process, I was surprised that within 30 minutes, I found quite a few examples of their “unique technology” that were not only available but superior in some ways and well past the “pilot” stage. Still, I thought the market might be big enough for multiple players. Let’s see how the earnings report looks.
Who wrote the title of the slide - positive trends emerging?!?
If you listen to the call, management is cool, calm, and collected, but not in a good way! They focused on the “opportunity” and the need to keep investing. Lip service was provided for being “lean,” but they explained that this isn’t a situation where you can “cut your way to success.”
The share price reacted as you might expect during the call as investors realized that the team had no plan to achieve results and would probably need to tap debt and/or equity markets before any commercial volumes might emerge.
I review thousands of investor decks and listen or read through hundreds of earnings calls every quarter. This one stood out for a total lack of awareness, and there have already been some doozies this year!
The company probably has some value as an acquisition target. They have assets, and the business could reach profitability if expenses were cut enough. None of this is going to happen with the current management team.
On the bright side, the company is at least telling the truth about how bad the business is.
We’ve got another one to review: a pile of misrepresentations built on manipulated numbers.