Long-Term Notes
Overall notes: A lot of my judgment about whether this business model makes sense does not come from my own work. I am not very confident in the judgment. The company's historical dilution is low. My view is that the company has real demand and a real product, but there are problems with unit cost and quality. The opposing stock community does not feel especially pure in its stupidity. There is currently a cost to borrow.
Technical path: Renewable recycled plastic.
- I do not understand this market, the technology, or the commercial viability well enough to be very confident.
- The technology itself was developed by PG, then sold to PCT, and then PG buys it back from PCT? If it works, why does PG not do it itself?
- Are the unit economics unviable?
How it keeps going:
- It keeps burning cash, but why is dilution so low? Where is the money coming from? 2025 Convertible Preferred. Warrants.
Stock communities:
- Reddit. # Somehow this community actually gave me a somewhat rational impression.
- SA comments.
Signals that I am wrong:
- The unit economics are proven, or vaguely proven.
- The company stops burning cash like crazy.
- Revenue rises substantially and PS is no longer absurd.
Learning Notes
Online Thesis
2026-05-08 BBM video
- The estimated cost of producing recycled plastic is more than three times the cost of virgin plastic. | Estimated in two ways.
- The two government-related news items highlighted by management are misleading.
Time-Sensitive Notes
Created Notes
| Stock | PCT | |
|---|---|---|
| Latest Earnings | 26Q1 | |
| Current Price | 10.68 | |
| Diluted Shares | 180.48 M | |
| Market Cap | 1.93 B | # The market cap is not especially large, but it is at least above 1B |
| Revenue | 10.90 M | |
| Earning | -224.8 M | |
| PS | 176.84 | # Completely insignificant |
| PE | -8.57 | # The rate of cash loss is okay, not especially fast |
| Cash | 121.10 M | |
| FCF (-SBC) | -189.9 M | |
| Cash Runway | 0.64 | # Less than one year; there may be something here |
| Dilution - 3 Years | 3.33% | # It has barely diluted at all, which really worries me |
| Dilution - 1 Year | 1.11% | |
| Short Float % | 28.58% | |
| Days to Cover | 10.37 | |
| Borrow Fee | 5.20% | |
| My MC Forecast - 3 Years | 1.02 B | |
| CAGR | 13.67% | |
| Confidence It Is Unviable | 2.50% | # Not confident. After all, there is a real product and real demand; the problems are cost and quality |
| Crash Catalyst Exists | 1.00% | # Less than one year of cash, so give it a 1 |
| No Short-Squeeze Risk | 2.50% | # Short-squeeze risk is pretty high, the highest among the companies I have looked at so far |
| Letmo Score | 7.67% |
| SS Calculation | PCT | |
|---|---|---|
| Expiration Date | 2028-01-21 | |
| Time to Expiration - Years | 1.62 | |
| Strike Price | 10.00 | |
| Current Price | 10.64 | |
| Credit - Worst | -1.60 | |
| Credit - Matching | 0.10 | |
| Credit - Best | 1.80 | |
| Annual Return - Worst, Incl. Fee | -11.77% | |
| Annual Return - Matching, Incl. Fee | -3.24% | # Right now I would have to pay to borrow shares, and the fee is even higher than Fidelity's, so I am not considering SS for now |
| Annual Return - Midpoint, Incl. Fee | -3.24% | |
| Annual Loss - One-Way Commission | 0.08% | |
| Annual Loss - One-Way Spread | 9.87% |
67% of the current position is SS, thankfully.
Current position:
Total Gain Total Return Exposure Weight
-13,807.14 -75.52% -32,089.30 -2.42%
Decision: Hold the position. A lot of factors are moving in directions I do not want. Watch for now; if I am truly wrong, then cut the loss when it is time to cut the loss.