⚡ Crypto + Renewable Energy

A new twist on mining [Image] Just when I thought I’d seen every iteration of cryptocurrency mining, a promotion dropped Soluna Holdings Inc. (NASDAQ: SLNH) in my inbox. You see, mining cryptos is a function of computing power, the computers themselves, and the energy to run them. That’s why you see crypto miners set up shop where they can get cheap electricity. But Soluna takes a completely different approach, one that’s quite ingenious. Whether it’s sustainable in the long term remains is the question. Oh, did I mention this $0.32 stock traded over $18 during the crypto craze? Soluna Holdings Inc. (NASDAQ: SLNH) - 1-month trading range: $0.251 - $0.415 - Typical average daily volume: ~400,000 - Float: 15.36 million Souna’s Business The company’s business model is pretty straightforward. Renewable energy sources often produce more power than is consumed. Solar facilities generate power when the sun is out, wind when it's blowing, etc. However, there aren’t great ways to store energy. So, unless our energy consumption matches up, which it never does, there can be wasted energy. Soluna looks for these opportunities, provided they meet operational cost requirements. [P7QPEwoPO5u1a7C8dHkuxv5og37ndHAxyhfyAoHIuQJ9GZVpJ8P_T4vy8badHP6jIBKgnQZN6LcyRI7Br9rizGbB4tEOYfdC83KI9gr3BuYDXNaw9qgtIzVp8LNsfOcxj1so_YVETymiNqadPm4dAZI] Even though the majority of their business is centered around crypto, Soluna serves other computing applications, such as artificial intelligence. The only problem with Soluna’s business model is it’s living on borrowed time. Excess energy is expected to decline as countries improve their power grid. And companies from all sectors are working on storage solutions. Once cracked, any excess energy ceases to exist. Financials Unlike many of the penny stocks I cover, this company has been profitable on a P&L and cash flow basis. In April 2022, the company sold its legacy MTI instruments business for $10.75 million, helping it hit its highest quarterly revenues in the company’s history. Unfortunately, the company’s SG&A has increased since Q1 2021, leading the company to operating losses ever since. However, Soluna’s been largely cash flow positive until the latest quarter. The company runs a pretty tight operation with $3.8 billion in long-term debt and only $1.1 million in cash. But the good news is the $63.8 million in PP&E gives it an asset base to borrow against to fund expansion as needed. It’s also worth mentioning that Solana’s done fairly well at keeping its cost per bitcoin mined to around $13,500-$14,000, in line with Riot (NASDAQ: RIOT) and Hut 8 Mining (NASDAQ: HUT), which is no small feat given its tiny size. Promoter Activity Promoter activity is limited to just one player, and their push came through text messages. So, there wasn’t any written content that highlighted any catalysts. However, there’s one story worth mentioning. On March 15, the company announced it raised $7.5 million from Spring Lane Capital for its Project Dorothy and some operational expenses. Project Dorothy is the company’s 50-megawatt flagship green data center co-located at a wind farm in Texas. The facility, at the initial deployment of 50 MW, holds up to 16K miners and will add up to 2.2 exahashes per second of bitcoin [uTHGNPChVrirau5RcXENTcuUr06FXspOkn3cIVtfrXGvApB-m16SwUoss5IJydb2GaRKqkG7fZlhJ-JvFkV5k3iboRLMrrtBmIhMycIw_9T9yNs0DVfECAHWxQuxSDyKw3ROQNzLQ2_E4E9xiu8-84g] The one promoter texting out this stock was paid $250,000 for a push stretching from 3/23/2023 to 4/24/2023 over a full month! However, the funds only covered a 5-day marketing campaign during that period. Previously, they’d been paid $250,000 for a promotion running from 1/20/2022 to 2/17/2022 as well as $250,00 for their work from 12/6/2022 to 12/2/2022, both 5-day campaigns. Straight to the Facts Given the run in cryptocurrencies and related stocks lately and the fact that the company borders on profitability, it’s surprising that it hasn’t had a big run yet. Even the nearly double in February seemed rather tepid. This is a stock that has all the trappings of a runner waiting in the wings. As long as crypto is on the board, this stock should be on your list. Always at your service, Baron Von Stocks P.S. Did you miss our FREE awareness alert last week on SLNH? We have a new one coming out TODAY... just text AWARE to 888-302-2141 TEXT "AWARE" TO 888-302-2141 Disclaimer: Always do your own research and consult with a licensed investment professional before investing. This communication is never to be used as the basis of making investment decisions and is for entertainment purposes only. 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