Is $GEVO a Fraud? The ESG Anticipation Hype is Getting Ahead of Itself
What if I told you that $NIO $PLUG $FCEL $NKLA $POLA $SUNW and yes $GEVO are grossly over-valued. Would you believe me? At the Last Futurist we are witnessing the liquidity pump of the Fed and low interest rates are creating major echo bubbles and dangerous group-think online with social media amplification.
New young investors are monitoring and praising their favorite stock stories, without checking the fundamentals of these companies. These feel good investors have never seen a normal stock market in their life, since in 2020 and 2021 it has been anything but that.
They are still living in the rocket-ship fuel of Tesla’s great ascent, creating a “new reality” for these investors. Unfortunately this new reality has very little to do with real investing, trading or how to analyze stocks and the future of business segments.
Tesla’s Warped Reality is Skewing how Traders Try to Game the System
Tesla led a dangerous over-estimation of EV startups that don’t have a hope of keeping those high stock prices. The same happend with the anticipation of Biden’s election and the possibility of a green tech renaissance in America. There’s only one problem with that story, it’s not true. China, Germany and others are years ahead of even the most progressive green tech startups in the U.S.
Shortly before $NIO’s stock went 25x, its own Government had to bail it out. In a real world of capitalism, it would have gone bankrupt.
So this leads us to $GEVO. An unprofitable company with barely 50 employees in a speculative biofuels industry. This is their website. The truth is America is likely a decade behind Germany, Scandinavia and China in green-technology. There’s nothing particularly innovative about $GEVO, certainly nothing that warrants it going from $1 to $12 in a few weeks of hype.
Gevo, Inc. operates as a renewable fuels company. It commercializes gasoline, jet fuel, and diesel fuel to achieve zero carbon emissions, and reduce greenhouse gas emissions with sustainable alternatives. This so called low-carbon firm is also deeply unprofitable.
The Abuse of Green Tech Anticipation and ESG Enthusiasm
Its 52-week range is downright scary. That’s 0.46 – 11.68. It was worth under $1 not too long ago. I understand we are in a liquidity-pumped market with GenZ investors skewing small-cap growth stocks, but this isn’t even a viable and growing business. It’s total revenue was down in 2019 compared to 2017, those aren’t the finances of a fastly growing company.
It’s very easy to spot a fraudulent pump on Reddit or Stocktwits. When your shares are being diluted this fast but the stock price is going up even faster, it’s a bad sign for future investors. As if overnight there are nearly 90,000 Stocktwits followers, and here is where major echo-bubbles are seen to form. Users say it will go up to $20 or higher. The stock was $0.55 in August. This begins to become an unethical game of pump and dumping momentum stocks, with ESG fueling the scam.
The company claims to develop bio-based alternatives to petroleum-based products using a combination of biotechnology and classical chemistry. That sounds great on paper to ESG investors. What exactly is supposed to happen to $GEVO to make it a success? To be acquired by Tesla or Plug, I don’t get it. The U.S. won’t even win the alternative or green tech energy sector, so what do you expect from this struggling startup that’s so overvalued in 2021?
Like Rocket Fuel without a Product
The latest story this company is using to be a rocket ship on the stock market with their youth cult like following pumping the stock? Sustainable Aviation Fuel! I’m not even kidding. ESG is a great theme for investing, but let’s not get ahead of ourselves. Let’s not fall prey for another social media amplified company that’s not exactly as great as it’s pretending to be.
Posts on Stocktwits and other communities are pretending like they are investing in the future of the planet with $GEVO. When they are just actors in a pump and dump in a highly speculative biofuels niche. This is nothing but a specialty chemicals company, that’s been on the brink of going bankrupt for quite some time with the kind of future promises that made Nikola such a bad company to invest in.
$GEVO recently announced a $350 million offering. That’s another 43,750,000 shares of common stock and $GEVO has gone up on the news. $GEVO is just one among a growing list of biofuels stocks, in a country that’s neglected Green tech for the last few decades so much, it may never be able to compete in the next phase of energy.
4% of $GEVO’s stock are held by insiders, another red flag. Gevo has a mission to transform renewable energy into low carbon transportation fuels. This next generation of renewable premium gasoline, jet fuel and diesel fuel with the potential to achieve zero carbon emissions, addressing the market need of reducing greenhouse gas emissions with sustainable alternatives.
Unfortunately Gevo has very little chance of becoming a serious energy company. The same goes for $POLA, $SUNW and any number of companies that have been running on green hype.
Sadly the dishonesty that’s rampant on social media isn’t being regulated making it a dangerous game if you don’t “play along” with the whims of these new retail traders on apps like Robinhood and WeBull. We have created an internet that’s a hype profiteering machine that’s fundamentally scamming the averages with the power of algorithmic echo-bubbles and massive investor group-think.
Today’s Price and the Future’s Price:
We are going to revit these stocks and show how they crashed in the future:
- $GEVO – today = $11.08 ——————— vs. in 9 months time….
- $POLA – today = $23.60
- $SUNW – today = $22.90
- $CLNE – today = $10.57
- $HYSR – today = $0.26
- $PLUG – today = $66.87
- $NIO – today = $61.95
- $TSLA – today = $847.50
- $NKLA – today = $20.12
The volatility of the above stocks isn’t a miracle, it’s a collective group-think dilemma. It’s too much liquidity being used to manipulate story stocks. It’s an internet blurring the lines between fantasy and reality. It’s a market that doesn’t care about earnings or future guidance, trapped in a pandemic where time has frozen. It’s a momentum traders paradise, where ethics don’t exist.
Like scammy cryptocurrencies worth nothing tethered to a default (reserve currency) value of Bitcoin, these ESG stocks are likely tethered to Tesla’s bloated price and a Musk-worship that has no basis in reality. This is when you can say the kids have learned how to gamble well, while committing group-fraud. The stock market is supposed to be about future projecting consensus of fundamentals and business realities, not a game of pumping stocks. The SEC really should look into this.
$GEVO’s story is a great example of the frauds that happen in a market that’s a bubble within a bubble. If you feel good about making money unethically like that, then that’s fine. But some elevator plays are just too good to be true and by participating, you are complicit, you are just another bad actor that’s part of a massive hoax.
You aren’t fueling a better planet, you are fueling a less honest market and less integrity online (that will hurt some investors who get caught up). So long as you understand that.
At the Last Futurist, we first wrote about $GEVO in August. The sad part is we called $GEVO’s ascent, but no stock “deserves” to go from $0.60 to $12.00 in such short a time period. Especially when the business fundamentals haven’t changed that much, just the flavor of the month.