Skull Session Chats with Lee and Charles. Stocks in Focus GENC, NURS.V [GeoWire Weekly No. 197] | 🇺🇸 PCHM, SGRP, ACFN, OPXS, CSBR, GENC, EVC, ALCO, UNFI 🇨🇦 DRX.TO, NURS.V

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This week’s Microcap Information Arbitrage Weekly Wrap-Up is ready — spotlighting key moves, missed signals, and overlooked opportunities in our 1,500+ coverage universe built since 2009.

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If you enjoy performing press release research or think you will see value in a tool that expedites your press release research process, you should check out a press release tool my team is building by going here.

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From Cologne, Germany, hats off to Siegfried “Siggy” Eggert for his big wedding day! Siggy was a GeoInvesting analyst from 2016 to 2019, but defected to do short selling side at Grizzly Research (@ResearchGrizzly).

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This weekly post will cover news updates from SGRP, ACFN, DRX.TO (ADFJF), a new percolating data center theme stock, OPXS, and CSBR.

I was also able to sit down with two really smart investors: Lee Roach and Charles Hutchison.

Lee Roach is private investor and writer behind the Substack newsletter, The Value Road. Lee laid out his process for finding mispriced, asset-heavy microcaps, while Charles, a private investor and Geoinvesting subscriber, gave us a deep dive pitch on Hydreight Technologies Inc (OTCQB:HYDTF) (TSXV:NURS), a stock that @realLigerClub and Matt Schofield (@almightyscho) had been chatting with our team about.

However, I’m going to start this Weekly intro with some strong opinions on a controversial note:

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And by the way, if you aren’t aware of this already, Geoinvesting has exposed 22 U.S. pump and dumps and billions of dollars in fraud with U.S.-listed China-based companies. 

So, we’re not blind bulls and are well aware that microcap investing can come with corporate governance issues and a propensity for fraud. There is a fine line between fraud and corporate governance, which is an interesting topic to ponder in the microcap universe. 

You can reference our postmortem on our WAVD Multibagger to Multibust investment to get some perspective on how we feel about weak corporate governance, when it matters most.

However, that’s what’s great about investing: we’re allowed to have differentiated opinions and bet on those opinions. It doesn’t make us better or worse than each other. However, if you can’t take criticism as an investor, we won’t be hanging out together at the bar or having dinner together. We’ve had a lot of winners at Geoinvesting and some devastating losers that we’re very clear about with our subscribers. 

Regardless, I suspect part of the reason why we’ve onboarded a record number of subscribers over the last 24 months is our increasing commitment to deliver quality information to our community. I think we’ve hit that flywheel moment in our growth journey, despite what some of the pessimists may say about us from time to time. Unfortunately for them, that motivates us even more. And as some of you may know, I like to sayalthough we’re not always right, when we are right, we want to be right big. We consider ourselves failing if we are not delivering the opportunity for our subscribers to earn a CAGR of 20% to 30%.

We built Geoinvesting for the everyday investor, not for the Wall Street elite… they can fucking kiss our ass. Main Street is where you’ll find our team turning over rocks.

As serendipity would have it, it’s an opportune moment to end this discussion topic on this tweet from today

Ok, let’s move on to some more pleasant topics.

Spar Group, Inc. (NASDAQ:SGRP) re-entered our sights after an attempt to acquire the company fell apart, but its cash-rich balance sheet, recent profitability, the potential for shareholder-friendly moves, and hints at upcoming announcements suggest there’s still something brewing.

Acorn Energy, Inc. (OTCQB:ACFN) made a long-awaited leap to the Nasdaq, which came with comments highlighting its debt-free remote monitoring power assets business with long-term 20%+ revenue growth guidance. ACFN is one of our favorite stocks and, appropriately, sits in our Focus Model Portfolio. If you asked me if there was a stock that I wanted to make a huge bet on, ACFN would be a candidate in that discussion.

Adf Group Inc. (OOTC:ADFJF) (TSE:DRX) landed a major five-year steel fabrication contract worth up to C$400M, which should smooth out its historically lumpy results and start a recovery, following a sharp pullback in the stock price in recent months.

See our next percolating data center information arbitrage find… join today to access this premium InfoArb opportunity.”

Optex Systems Holdings, Inc. (NASDAQ:OPXS) added another military contract, $10.2M over five years for Abrams tank optics, further confirming management’s hints at a rising backlog and building momentum. 

Meanwhile, Champions Oncology, Inc. (NASDAQ:CSBR)’s uninspiring Q4 financial results reminded us that scaling its data licensing business will take longer than hoped; small wins are trickling in, but the big inflection point remains elusive. 

Up next, our interview notes with Lee Roach and Charles Hutchinson, two investors who gain investing edges by ignoring the noise and digging where few others look.

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Lee Roach: Making Noise with Boring Stocks

Last week, we kicked off the first of two Investor Insight Skull Sessions with Lee Roach, a private investor and writer behind the Substack newsletter The Value Road. Lee’s path into investing wasn’t a product of a finance background or a Wall Street job—it came from curiosity, his love of history, and a lucky thrift store discovery of The Intelligent Investor. He also plays the guitar and used to play with his heavy metal band, Pestilent Age.

One of our new research team members, Diego La Torre, joined the conversation. 

We were excited to have Lee on the show, as it was his first-ever investor-facing video chat. However, Lee had also participated in an @IdeaBrunchEmail interview.

Over the hour-long conversation, Lee laid out a process that’s both refreshingly basic and surprisingly effective. It deeply resonated with my approach to investing in finding excitement in boring stocks. The conversation naturally evolved into stocks we are both familiar with.

Lee sifts through OTC and microcap listings manually, looking for small industrial businesses with low enterprise values, hard assets, and tangible catalysts like asset sales or margin normalization. Most of the names he ends up writing about wouldn’t pass editorial review at Seeking Alpha, which is exactly why he started his Substack last year.

He’s not shy about his learning curve. “The first time I read [Graham’s book], I actually had no idea what it was talking about,” he said. His early investments were mostly tech fads and green energy names that lost money for him.

Lee now runs a ~$36K personal account with about 12 positions and an annualized $66K from Substack subscriptions. His holdings are the kind of companies that are either overlooked or unfairly punished— Entravision Communications Corp (NYSE:EVC), Alico, Inc. (NASDAQ:ALCO), United Natural Foods, Inc. (NYSE:UNFI), and Gencor Industries, Inc. (NYSE:GENC) among them—and he’s made no secret that he leans into pain points and misunderstood filings.

On his approach: “When something’s on fire, I’m running toward the fire trying to figure out what’s happening,” he said. He’s a self-proclaimed falling knife catcher, but with a checklist. No biopharma, no crypto, no flashy narratives. Just “boring” businesses with beat-up stocks and fixable issues.

His favorite setups often include old, family-run firms with underutilized assets and sleepy balance sheets. In one example, we discussed Gencor Industries, Inc. (NYSE:GENC)’s (road construction equipment) auditor change that caused filing delays and spooked investors—something Lee believes is temporary and misunderstood. When he pulled it up on screen, I couldn’t help but react—GENC has about $10 per share in cash, and was trading around $12. That’s the kind of setup we know well: a cash-rich, asset-heavy company temporarily discounted due to technical noise. Classic information arbitrage.

The stock had fallen pretty sharply from the $20 range to $11-$12 on the heels of some soft quarters and more likely due to a delay in reporting SEC filing requirements for several quarters. There were probably some investors who impulsively sold on negative headlines regarding the delayed filings. However, this was due to the company having to retain a new auditor because their previous auditor was acquired. So, it wasn’t because of any other negative reason (there’s always a risk when a new auditor has to bless the work of prior auditors. During that review, the new auditor found some material weaknesses that it wanted the company to rectify. 

By the way, on Friday, the company became compliant with its SEC filing requirements. Here is the link to the GENC Q2 report archived on our new News Release Application.

While the material weakness is still in the process of being cured, the filing uncertainty should now be lifted. Although we have not seen any specific release that the company is now in compliance with the NYSE, we expect the company will issue one soon.

That could give the stock another tiny bit of a “recovery” lift. However, in order for momentum to be sustained, we’re going to have to see the company resume some type of consistent sales and earnings growth, which has been a challenge with them over the years. Cash per share is still sitting at around $10. So, dips that get close to that price again could be a gift.

Lee’s also watching the evolving opportunity in legacy media companies like Entravision Communications Corp (NYSE:EVC), tied to potential FCC deregulation and undervalued spectrum assets. “That’s one of the few intangibles I think actually matters,” he said, noting that spectrum auctions and easing ownership caps could drive M&A and re-ratings in the space.

The full interview captures more than just stock ideas; it’s a look into how someone with zero formal financial training built a repeatable, research-driven approach by just putting in the time. Just a factory worker from Michigan mixing death metal riffs with due diligence.

You can catch the full conversation here or check out Lee’s Substack, where he posts weekly write-ups of deep value ideas (most of which he owns personally). We’ll also be adding one of his favorites, Alico, Inc. (NASDAQ:ALCO), to our index this week.

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The Weekly Wrap-Up is meant for those in a hurry, along with those who want to spend a weekend hunting for ideas or quickly catch up what we talked about during the week. Our Weekly Wrap-Up brings together everything we discussed during the week in our morning emails and premium alerts, as well as new information and high conviction ideas that we did not communicate that you should know about. From earnings coverage, new research coverage on stocks, picks and research from our subscribers to event highlights from our monthly open forum that takes place to the beginning of each month and interviews with management teams and investors. Missed any emails this week? You can catch up on all of them in one place — just check out the full archive here.

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Charles Hutchison On Hydreight’s Multi-Vertical Telehealth Wager

Diego and I also sat down with Charles Hutchison, a Geo member who’s been closely tracking Hydreight Technologies Inc (OTCQB:HYDTF) (TSXV:NURS), a nano-cap telehealth company building out a 50-state compliant medical infrastructure, and now betting big on a white-label platform called VSH1. In a nutshell, Hydreight wants to be the Shopify-for-telehealth, enabling others to launch GLP-1, testosterone replacement therapy (TRT), and other direct-to-consumer health clinics without needing to build the regulatory stack themselves.

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GeoInvesting is a premier research platform for microcap investors, dedicated to uncovering high-potential stock ideas in undervalued companies across various sectors. With over 30 years of investing experience, GeoInvesting has covered more than 1,500 equities, providing often actionable proprietary research. The platform has been instrumental in identifying 200+ multibagger stocks, and offers investors exclusive access to over 600 management interview clips, allowing for deeper due diligence and understanding of the microcap stocks, many of which make it to market-beating premium Model Portfolios. Join the GeoInvesting community for the best stock research and microcap insights to help you stay ahead in the market. To learn more about our Premium Services, go here.. (https://geoinvesting.com/premium-research/)

The post Skull Session Chats with Lee and Charles. Stocks in Focus GENC, NURS.V [GeoWire Weekly No. 197] | 🇺🇸 PCHM, SGRP, ACFN, OPXS, CSBR, GENC, EVC, ALCO, UNFI 🇨🇦 DRX.TO, NURS.V appeared first on GeoInvesting.

Source: https://geoinvesting.com/skull-sessions-chat-with-lee-and-charles-stocks-in-focus-genc-nurs-v-geowire-weekly-no-197/