Can't wait to attend the conference, and stay tuned for my appearance 😀.

Long the common unit $DLNG. This six-ship LNG owner trades at a 60% discount to my estimated net asset value, and my valuation implies about 50% upside from where it trades today. Dynagas owns six LNG carriers on long-term charters, generates roughly $100M in annual EBITDA, and has a market cap of just $120M. Debt and preferred capital explain part of that gap, but the company is steadily paying those obligations down. The latest move is a $50M redemption of its 9% preferred units, announced October 9. That cuts annual preferred payouts by $4.5M, equivalent to about $0.12 per common unit against a current annual dividend of $0.20. For common holders, that is meaningful: fewer claims ahead of us and more room for bigger payouts as the balance sheet improves. The reason for the discount is also clear. Two ships carry Russian LNG, and the controlling owner decides where the cash goes. At roughly 40% of my estimated net asset value, though, I think the potential reward makes those risks worth taking. I bet that continued debt repayment turns this overlooked shipowner into a much stronger cash payer. My model assumes a debt-free fleet by 2030, and the about $5 valuation reflects the cash I expect common holders to receive across several scenarios. Full thesis, valuation, and risks in the free write-up:👇 microcapdr.substack.com/p/dy… Not investment Advice. Do Your Own Work.

Shorts based on valuation are okay. But shorts that depend only on valuation? Those don’t work. Just being overvalued isn’t enough. The real profits come when a stock is overvalued, you have a clear timeline, and you can borrow the shares. Otherwise, you end up stuck paying fees while you wait for the story to fizzle out. And stories don’t have scheduled earnings reports. I broke down these three factors here: microcapdr.substack.com/p/sh…

I closed my $DNA short today, locking in a sizeable gain. Last week, I mentioned this short cleared my first and third hurdles but not the second: there’s still no clear, scheduled event pushing the price down. When a short doesn’t have a real catalyst, and the price moves your way this quickly, you take the profit and move on. That’s one of my key short-selling rules, and I, of course, stuck by it. Otherwise, nothing has changed in my mind about DNA’s valuation. Even at today’s price, the market expects growth that just isn’t in the numbers. But having a solid thesis doesn’t mean you should hang around too long. DNA’s been swinging roughly 7% daily this past month, and last week it soared almost 15% in one session. The next splashy AI-lab story could spark another move. My calls never paid off, but that’s fine; having cheap insurance you don’t need is still useful. It kept me steady through all those wild price swings. $DNA is back on my watchlist. Their Q3 earnings, probably coming in November, should reveal how fast the cash is burning. If the stock runs back into the teens with no real orders backing it, I’ll take another look. Not investment advice. Shorting stocks can lose you more than you put in, and options can expire worthless.

I’m short $DNA (Ginkgo Bioworks), and I’ve got call options as a backup. By my own playbook, a good short has to clear three hurdles, and just being “expensive” is only the first one. So why am I shorting a stock without a clear catalyst? Because this isn’t your run-of-the-mill overvaluation. The market pegs Ginkgo at around $830 million, which is ten times its revenue, and which has been cut in half: $20.2 million last quarter versus $39.1 million the year before. Meanwhile, its spending hasn’t budged. Ginkgo burns through $43 million in cash each quarter just to keep the lights on, plus about $14 million for space it’s not even using. That’s over $600 million in rent left to pay, and only about $300 million in cash. If you run the numbers, today’s price implies they’ll pull in about $1.5 billion a year by 2032, and that’s assuming healthy margins. I’ve tried out a few scenarios to see if the company can break even. None of them, even the most optimistic ones, get anywhere close. When the gap is this big, I don’t need to know the exact timeframe. I just need to stay in the game until the numbers start to bite. Second hurdle: Is there an event with a deadline? Not really. Q3 results, probably coming in November, will show how fast they’re burning cash. But Ginkgo can still raise money by selling more shares while prices are up. That would hit the stock on the day, but it could buy them a few more years. If they do a big raise, I’ll just close out my short, take profits, and walk away. While I’m waiting, I’m holding calls. No catalyst means the waiting game that comes on top of market enthusiasm for AI-run labs. That’s a very risky setup for naked shorts. The calls limit my losses if the stock jumps. Third hurdle: Can I actually trade it? Yep. For now, the borrow is affordable, and options are available. If they weren’t, I’d just watch from the sidelines. I could be wrong. The tech seems legit, and if they ditch that empty building or land some real orders with actual money, I’ll rethink everything. Not Investment Advice. Losses from short selling have no ceiling, small caps can gap 20% in a day, and your broker can raise margin or recall the shares when it hurts most. Options aren’t a free fix either: they cost money, they decay, they often trade with wide spreads, and they can expire worthless. A hedge that has expired protects nothing. Want to know more about shorting microcaps and the three hurdles? Here's the link to my FREE blog post:👇 microcapdr.substack.com/p/sh…

Do low taxes and lenient regulations really benefit microcaps? Well, this depends on which taxes and which regulations we are talking about. As an economist, I would argue that a rule that prices an externality isn't just a cost. It creates a market. And securities regulation is the reason microcap investing works at all. Weaken disclosure and enforcement, and our corner of the market is where the frauds show up first. Now, as an investor: plenty of microcaps I've studied exist precisely because of a rule or a budget line. Emissions rules: ClearSign ($CLIR) sells ultra-low-NOx combustion tech. Air quality regulators set its demand. Trade enforcement: Titan Mining ($TII) is building US natural flake graphite. China's graphite export controls and the US trade case on Chinese anode material are a big part of why a domestic supply chain makes sense. Industrial policy: Electrovaya ($ELVA) is building out its Jamestown, NY plant with EXIM financing under domestic manufacturing programs. Defense and homeland security: Ondas ($ONDS) in counter-drone, $AMSC in Navy ship protection systems, $AISP selling to DHS and federal law enforcement. Public infrastructure: much of Tutor Perini's ($TPC) backlog is public works paid for out of state and federal budgets. Public safety: Gatekeeper ($GSI.NE) sells video systems to school districts and transit agencies, all funded by public budgets. Of course, it cuts both ways. $TOYO's thesis depends on Section 232 and circumvention rulings. SunPower's ($SPWR) residential economics changed when the 25D credit ended. ADF Group ($DRX.TO), a Canadian steel fabricator, has to absorb US steel tariffs. @onecentinvest's tweet has a fair point. Compliance is a fixed cost, and it hits a $50M company harder than a $50B one. But for microcaps, the useful question isn't more or less regulation. It's which rule, who pays, and who gets paid. That's where the mispricing is.

News was dropping on $TII, so an update was overdue. Since my first post on August 28, the stock’s dropped 25%. This isn’t just $TII, though. Over the same period, the strategic-metals ETF ($REMX) lost 20%, and the closest publicly traded peer, $NMG, dropped 25% as well. Here’s what’s happened lately: - The US Army put forward a term sheet for a 50-year site lease at Anniston Army Depot for the purification and spherical graphite plant, with two 25-year renewals included. - The state permit database showed eight fresh applications for the commercial graphite pit. - The federal wetlands permit’s comment window closed quietly; no opposition reported, and they managed to cut the affected wetlands area in half. - The new US-China tariff list skips graphite. China has also agreed to keep its critical minerals truce in place until January. - Reuters says we should see germanium production before the end of the year. I’ve also thoroughly reviewed and updated my model. Tweaks are factual only; my valuation judgment stays the same, and all corrections are open to everyone. Right now, the gap between share price and my valuation has only grown since the first post. Paid subscribers get a deeper dive: what today’s price tells us, my reasoning and the questions I’m still turning over, catalyst values, discount stress tests (since the 10-year yield is over 5% now), a close read of the Army deal, and the Q3 call questions I’m putting together.👇 microcapdr.substack.com/p/ti… Disclosure: Long $TII. Not Investment Advice. Do your own research.

My quick reaction to $TOYO Analyst Day: First, the positives. The second Houston line is finished. US module prices jumped by 10 to 20 cents a watt. Plus, the third-party factory audit came back clean. What’s still in limbo: Customs is still holding up four cell shipments, and now they’re saying it hits Q4 earnings too, not just Q3. There’s no forward guidance, no Q3 results, and they haven’t locked in financing for the new cell plant yet. Also, nobody mentioned the First Solar patent case. In the previous tweet, I said I’d send the full update shortly after Investor Day, but I’m waiting a few more days. The reason is that $TOYO’s Customs adviser thinks the shipment detentions will be sorted out within a week. That alone will shift my numbers more than anything that came up today, so I’d rather wait and give you the full picture all at once. Long $TOYO. Not investment advice; do your own research.

This great insight from @DeepSailCapital literally begs for the follow-up: if the backlog keeps growing faster than revenue, then why doesn’t this show up on the income statement? To me, there are two main reasons, and they point in very different directions. First is quality. $DRX.TO is a boring industrial with a quality backlog. They report about C$646M in firm contracts, which is a conservative number, as they’re not counting a C$127M U.S. project or an extension option in Québec. So you have a pretty grounded headline figure. Now, compare this to $SIDU in the hyped-up space sector, and you’ll notice they don’t even disclose an aggregate backlog. All they publicize is a spot on a $151 billion Golden Dome IDIQ contract, split with roughly 2,100 other vendors. The catch? None of that turns into revenue until they actually win task orders, and their total revenue for the first half of the year was under $1 million. Same word, “backlog,” but a totally different meaning. Before trusting any company’s backlog, ask yourself: Is it actual signed orders? Is it options, broad framework deals, or just hyped contract announcements? Dig into the details. Second is capacity. Maybe the company just can’t ship the orders fast enough. For example, a defense retail darling, $LPTH, took its backlog from $19M to $111M in two years. That’s impressive, but management says the main story for fiscal 2027 is capacity constraints: glass melting is the big choke point, and detector lead times have stretched from six months to beyond ten. So these orders keep stacking up, but the factory can’t spit them out quickly enough. And that’s a risk: backlogs that linger can get delayed, repriced, or canceled. Now look at $OCC: their backlog went from $5.7M to $13.3M, but the plants were running at just under 50% utilization, so they could actually turn new orders into revenue without needing to ramp up spending. So here is my word of caution to retail investors, especially the less experienced ones: backlog is NOT realized revenue. Companies can define it however they want, as there’s no official GAAP standard, and it’s not audited like revenue. Before you get excited about a rising backlog, check exactly what’s in there, how fast those orders usually turn into cash, and whether the company actually has the factories, people, and materials to deliver. Sure, real revenue eventually moves in line with the backlog, but only for orders that are solid and actually shippable. Everything else? It’s just a story about what might happen someday, not what’s in the books right now. I currently don’t hold shares in $LPTH, $SIDU, $DRX.TO, or $OCC. May initiate a position. Not investment advice. Do your own work.

$CLIR is having a busy week: DOE validation selection yesterday, and today they announced another M1 burner order with Tulsa Heaters Midstream. That’s the fourth THM order from the same Permian gas-processing customer, and the seventh M-Series order in the region since May. They’re planning to deliver in Q4. This is obviously good news, as the same customer is coming back four times. Also, the pace is impressive with seven orders in roughly five months, which is faster than I expected from midstream for 2027. A couple of things to remember, though. Midstream accounts for about $8M out of the $97M market ClearSign says is available right now, while process burners make up $82M. Plus, none of these deals touch the refinery story. That all hinges on the Gulf Coast project starting up in November with all 26 burners. Long $CLIR, position unchanged. Not Investment Advice. Do your own work.