Proven Bypass Oil Filtration Technology – that Reduces Costly Oil
Changes, Downtime and Engine Wear – is Poised for Sales Breakout
Puradyn produces innovative engine oil filtration systems that drastically reduce costs, maintenance and downtime. Puradyn filters remove oil contaminants and replace additives – keeping oil in “like new” condition, reducing oil changes and increasing engine life.
Having proven the technology with several industry leaders, PFTI is now engaged in sales efforts with several substantial oil field and industrial companies that offer (but by no means guarantee) breakout sales potential. (see “New Business Activity & Outlook”)
PFTI’s CEO is sufficiently confident in Puradyn’s outlook, he has funded working capital deficits totaling $10M over several years. His background and integrity (we met with him) provide us the confidence to introduce you to this nano-cap name.
Puradyn Investment Strengths:
- Patented filter technology delivers >75% decrease in oil use, oil maintenance and related costs.
- Thousands of installations in operation globally.
- Razor-razor blade model – delivers solid ongoing revenue streams from replacement filters required to maintain filtration performance.
- Rapid customer ROI: 100% cash-on-cash return in as little as a few weeks to several months.
- Compatible with several large engine markets:
- Oil drilling; pipeline compressors
- Marine vessels
- Mining haul trucks
- Hydraulic systems
- Heavy duty equipment
- Solution works on all size engines including CAT, John Deere, MTU, etc.
- Scalable production facilities support growth.
- Impressive management team owns 28%.
- CEO Joseph Vittoria was previously CEO of AVIS.
- Very attractive valuation relative to annual customer savings and global sales potential across all markets.
“Our patented bypass oil filtration system saves
one oil industry customer over $5M per year.”
Joe Vittoria, Puradyn CEO
Yet PFTI’s market cap is roughly 2X this customer’s annual savings – making PFTI worth far more to the customer – than to all of Wall Street.
The CG Focus List thesis is that PFTI’s valuation hugely understates the global cost savings its patented technology could deliver – and that will ultimately be reflected through share price appreciation or M&A when sales ramp.
- Demonstrated nearly 70% efficiency at removing solid contaminants below 1 micron.
- Easy-to-change filters; rugged filter canisters built for extreme conditions.
- Filter replacement ever 250-1,000 hours
- Up to 24 filter replacements per year.
- Saves up to $3K per avoided oil change in large oil field applications.
- Increases machine efficiency, oil circulation and purity and engine life.
- Applicable to all diesel, gasoline and gas engines.
- Approved by John Deere.
- Supplying military contractor with 750 small units over 3 years, estimated revenue of $300K.
- Military Tractors (Freightliner).
- Armored fighting vehicles (MRAP).
Nabors Industries – Oil Field Services
- Customer since 2009, ~ 2,000 units.
- International division saves over $5M per year on 400 systems for large oil drilling rig engines.
South Ferry (Shelter Island, NY)
- Customer since 2002.
- Puradyn extends oil drain intervals from 250 hours to 3,000 hours on each vessel.
- Extended time to engine overhaul by ~300%.
puraDYN’s rugged, high efficiency, multi-stage bypass filtering system consists of an external canister that houses a disposable filter element (with time release additives) and a heated chamber to evaporate water, fuel vapors and other gaseous contaminants.
Why Bypass Filtration is Needed
60% of engine wear is caused by particles between 5-20 microns, yet most OEM full flow filters only perform efficiently down to particles between 15-40 microns.
puraDYN bypass oil filtration systems filter particles as small as 1 micron or less, reducing engine wear from particles not trapped by normal full flow filtration. A micron is really small – 1/1,000th of a millimeter or 1/25,400th of an inch.
Emission Regulations are Driving Demand
New engines are designed to meet strict emission regulations, with the unintended consequence of generating greater amounts of soot in the oil. Increased soot and other solid contaminants, plus fuel and water that cannot be effectively removed by full flow filters, create greater need for bypass filtration.
puraDYN’s simple bag-and-trash filter element disposal.
New Business Activity & Outlook
Currently, a number of evaluations are in progress in the U.S., Mexico, Central and South America, Africa, Indonesia, China, Russia and the Middle-East, and a few are about to begin.
Each customer prospect insists on a product evaluation, given the high value of the engines involved and their requirement for 24/7 service.
Of note, one evaluation is for one of the world’s largest oil & gas companies. Puradyn has already achieved the customer’s initial objective, but one final test is underway in Europe. This final evaluation is within 80% of the customer’s targeted duration and is progressing as planned.
Disclosure: The parent of CG Focus List, Catalyst Global LLC, is is an investor relations consultancy. Puradyn Filter Technologies is not a client of Catalyst Global. Coverage of Puradyn reflects the belief of Catalyst and a fund manager we respect that the company represents a very attractive special situation. Neither CG Focus List nor Catalyst Global have received compensation of any kind for the preparation and distribution of this Alert.
CG Focus List and/or its affiliates do have long positions in Puradyn shares but per our trading policy, we will not effect any transactions in Puradyn shares for five days following the distribution of today’s article.
Authors: Kate Keller & David Collins – CG Focus List