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Stock Alert for EcoBlu Products Inc. (ECOB)

EcoBlu Products Inc. (OTCBB: ECOB)

EcoBlu Products Inc. (ECOB) is a manufacturer of wood products coated with non-toxic chemistry that protects against mold, rot-decay, termites and value-added fire. The Company is engaged in providing a complete home system of value-added fire, mold, wood rot and insect protection of all wood components for homebuilders, remodelers and homeowners. The family of ECOB products includes dimensional lumber, joists, beams, rim board, sheathing and trim. Wood components and engineered wood products are manufactured and coated in its California and Texas facilities for distribution throughout the United States and for export.

The Company was formerly known as N8 Concepts Inc. and changed its name to EcoBlu Products Inc. in August 2009. ECOB was founded in 2007 and is based in Vista, California.

Share Statistics (24-May-10) FY

2008

FY

2009

%

Chg

Q4 2008 Q4 2009 %

Chg

Symbol ECOB Revenue, $K 5.0 1.0 -80% n/a n/a n/a
Current price $0.39 Gross marg. -20% n/a n/a n/a n/a n/a
52wk Range: 0.20-1.25 Oper. margin -1,020% -4,000% 292.2% n/a n/a n/a
Avg Vol (3m): 226,425 Net margin -1,020% n/a n/a n/a n/a n/a
Market Cap. 27.07M
Shares Outstanding 69.23M EPS, $ n/a n/a n/a n/a n/a n/a

Source: Reuters.com, SEC Filings.

Financial Summary

The Company recorded net income of $1.4 million, or $0.01 basic and diluted loss per share for the three-month period ended December 31, 2009, as compared to a net loss of $1.0 billion, or $18.42 basic and diluted loss per share for the three-month period ended December 31, 2008. EBITDA was $75.9 million for the fourth quarter of 2009 as compared to negative $932.2 million for the same period in 2008.

Source: DryShips Inc.

The Company reported a loss from operations of $2.091 million for the three months ended March 31, 2010, primarily comprised of consulting expense of $1.524 million, professional fees of $168,432, rent expense of $248,974, compensation expense of $44,078 and marketing expense of $42,976. During the same three-month period, the Company also incurred a one time gain of $13,142 on the settlement of its Texas lease, a loss of $110,720 on the settlement of debt through the issuance of its common stock, a loss of $331,336 from an increase in the fair value of a derivative liability and $15,669 of interest expense. The Company’s net loss for the period totaled $2.536 million,

On March 31, 2010, the Company had $979,011 cash on hand. Its operations used $902,829 of cash in the nine-month period ended March 31, 2010. Included in its cash used in operations was $400,885 of lumber inventory purchased from a company controlled by the Company’s president.

Source: Form 10-Q for ECOB


Financial Strength (24-May-2010) Company Industry Sector S&P 500
Quick Ratio (MRQ) 0.18 1.28 0.65 0.79
Current Ratio (MRQ) 0.18 1.74 0.79 0.95
LT Debt to Equity (MRQ) 3.34 48.86 23.65 134.30
Total Debt to Equity (MRQ) 3.34 66.04 38.86 201.19
Interest Coverage (TTM) -0.05 0.10 42.32

Source: Reuters.com, SEC Filings.

Analyst Consensus

No analyst rate shares of ECOB at this time.

Consensus Estimates Analysis

No consensus analysis data available.

Source: http://www.reuters.com/finance/stocks/financialHighlights?symbol=ECOB.OB

Investment Highlights

ECOB is the premier manufacturer of proprietary wood products coated with an exclusive non-toxic, eco-friendly chemistry that protects against mold, rot-decay, termites and value added fire. ECOB is committed to providing a complete home system of value added fire, mold, wood rot and insect protection of all wood components for homebuilders, remodelers and homeowners. The family of EcoBlu products includes dimensional lumber, joists, beams, rim board, sheathing and trim. Wood components and engineered wood products are manufactured and coated in the Company’s California and Texas facilities for distribution throughout the United States and for export.  Best of all, EcoBlu coatings are GreenSpec listed, which makes it an environmentally sound building decision, quickly becoming the choice of green builders around the world.

Latest Developments

ECOB recently announced that its national account TUFF SHED Inc. has increased its use of EcoBlu’s BLUWOOD(TM) coated panels in the construction of its outdoor storage buildings, garages and custom buildings. The Company has successfully filled a large order of BLUWOOD(TM) coated panels, which was shipped into TUFF SHED’s distribution facility in Texas.

“We have a great relationship with Tuff Shed and they continue to place orders for Bluwood™ coated panels. Our technology plays a huge role in the future of wood structures and the consumer continues to drive our markets. Tuff Shed’s recent promotion just shows what is important to the consumer,” ECOB president and CEO Steve Conboy stated in a press release.

The Company continued Friday’s upward trend Monday after it announced that international affiliate Luxor Industrial Corp. of Vancouver, British Columbia has converted all production of their proprietary patented IBS2000® and patent pending IBS3000™ engineered bridging products to be exclusively coated with Bluwood™ technology. According to the release, Luxor expects to start shipping these bridging devices into distribution by June 2010 and anticipates the Bluwood™ coated product lines will have a significant impact in the markets that are now serviced across Canada.

As of last close on May 24, 2010, ECOB closed at 0.391, 95.50% above the 52-week low of 0.20 set on May 19, 2010.

Source: EcoBlu Products Inc.

Technical Analysis

Source: http://stockcharts.com

Friday, ECOB closed above its 13-day moving average. This is generally considered to be an indication of a bullish trend.

ECOB’s recent volatility has been greater than normal. This is evidenced by the increased distance between the upper and lower Bollinger Bands. These bands measure volatility using standard deviation and a large width is due to high volatility.

ECOB’s MACD is currently indicating a weak bullish signal. Although the MACD is trending above the signal line, the indicator is still below zero, which suggests that the underlying moving averages are bearish.

Comparative Analysis

ECOB has no meaningful publicly traded competitors.

Source: Thomson Financial

Insider Trading Activity

NET SHARES PURCHASE ACTIVITY

Inside Purchases – Last 6 Months

Shares Transaction
Purchases n/a n/a
Sales n/a n/a
Net Shares Purchased (Sold) n/a n/a
Total Insider Shares Held n/a n/a
% Net Shares Purchased (Sold) n/a n/a

Net Institutional Purchases — Prior Qtr to Latest Qtr
Shares
Net Shares Purchased (Sold) n/a
% Change in Institutional Shares Held n/a

Source: Yahoo Finance

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