Sponsored by West Coast Media*

TODAY’S TOP ALERT! 

Nasdaq: CDZI

Live Teaching and Trading with a 20+ year seasoned trader right at your fingertips!

Join Jeff Williams in our Market Masters Room this morning from 9am to 11am ET to watch and listen as he breaks down markets and some of the hottest penny stock movers today.

Happy Friday!

I was very excited to see that the “tactical trade” idea I’ve been touting since Wednesday had a green day yesterday despite the market downturn.

And even though futures for the major indexes are down this morning, here’s where that stock is sitting:

Now it is up nearly 20% over the last couple of days!

I hope you were paying attention to what I was saying about it.

If you recall, I said the stock was worth following so long as it remained above the support it had established around the $4.00 level. Sometimes, these trades take a few days to play out.

I’m going to add this one to the win column! ✅

My win streak continues with these “tactical” ideas, and now I’m hoping to extend it further.

My “tactical” idea for today is a stock I first wrote to you about back in early September…

It’s up 8% since that time, which is pretty good, but what really interests me is a monster rally it had at the beginning of this month when it ripped 30% higher in a week.

Go ahead and pull up Cadiz Inc. (CDZI) on your trading platform.

You’ll see that the stock has pulled back a bit this week, and that’s why I think it’s the perfect time to take a close look at it.

I’ll go into more detail about this below, but I think the stock trend has been driven largely by news.

There was great news that sent it soaring that 30%, and an earnings miss that helped fuel the pullback.

Yesterday, though, the stock closed slightly up — again, despite the market downturn — signaling that investors may have sobered up and remembered the incredible potential of this company.

As you’ll see, the company has been around for a while, but only now is it on the cusp of going live with major projects that have been decades in the making and that should make the recent earnings miss completely insignificant.

I think yesterday may have been a turning point, and that we could see another big gap up for CDZI to close the week.

No guarantees, naturally, but I’ll explain a bit about the company so you see where I’m coming from.

CDZI is a Los Angeles-based water infrastructure company that was founded in 1983 in Cadiz, California.

Cadiz — the company’s namesake — is an unincorporated town in the Mojave Desert, an area so arid that it was used as testing grounds for the Mars Rover.

On the surface, it’s an unusual place for a water infrastructure company…

Except that beneath the surface is an aquifer that stores 30–50 million acre-feet of freshwater, greater than the full capacity of nearby Lake Mead — America’s largest surface reservoir.

The company owns 45,000 acres, 9,600 acres of which it calls Cadiz Ranch, and is the largest agricultural operation in San Bernardino County.

For 40 years, CDZI has operated the agricultural development, featuring citrus, grapes, melons, peppers, and squash.

But CDZI’s biggest aspirations are to provide clean, affordable drinking water to nearby communities, and it has been partnering with water agencies, local governments, and community leaders to pull that off.

The company lays out its mission in an epic, cinematic video that I highly recommend watching.

The idea is to intercept the flow of water as it travels from nearby mountain ranges and passes through nearby Fenner Gap — before it reaches hypersaline dry lakes, rises to the surface, and quickly evaporates.

From there, CDZI plans something it says will be “first in the world” — a conversion of oil and natural gas pipelines to convey the water.

There is already an extensive network of pipelines nearby (here is a helpful, interactive map).

In 2014, CDZI purchased a 220-mile section of pipeline (the “Northern Pipeline”) that runs next to Cadiz’ aquifer that it says can be “easily converted to safely and efficiently move water.”

The pipeline “will connect not just to water-scarce communities along its path, but also to the State Water Project’s California Aqueduct, a major source for all southern California.”

Additionally, the company is planning to build a 43-mile “Southern Pipeline” which will connect to the Angeles Tunnel aqueduct branching off the Colorado River.

These pipelines can be used not just to supply water, but to store it.

Southern California has notorious drought problems, and the Cadiz aquifer has room to store at least 1 million acre-feet of water in times of excess, making it “the largest new groundwater storage bank in the Southwest.”

To put that in perspective, that’s enough storage to supply two million households.

On August 15, the company announced “that it has secured water purchase agreements for 85% of capacity of the Company’s ‘Northern Pipeline.’ “

That amounts to 21,275 acre-feet of water per year, and the company said it “expects to receive net revenue of approximately $850 per AF in 2024 dollars for water purchased under the agreements.” That comes out to more than $18M per year.

CDZI said the agreements “will enable the Company to secure third-party capital to begin construction of the [Northern Pipeline] Project in 2025 as planned” and that initial water delivery could be as early as 2026.

The company also noted that it would be contracting for water delivery via the Southern Pipeline later this year, and that it hopes to begin construction on that in 2025.

On Monday, the CDZI announced the purchase of 180 miles of steel pipe from the terminated Keystone XL pipeline which it will repurpose to expand the company’s pipeline network.

Beyond agriculture and water supply, in 2022 the company acquired ATEC Systems, a water filtration company, for about $2 million.

The LA Business Journal said that the goal was “to secure a consistent revenue stream for Cadiz” and indeed, this year the company is projecting $15 million in revenue from ATEC.

The company has received orders outside California, including from Oregon, Wisconsin, Nevada, and Washington state.

On October 23, CDZI revealed a partnership with RIC Energy to build California’s largest green hydrogen facility at Cadiz Ranch.

Under the agreement, “Cadiz will supply land and water to RIC Energy for the creation of industrial quantities of 100% green hydrogen using solar energy.”

The facility will use “photovoltaic (PV) solar for its power supply on up to 3,000 acres of the Cadiz Ranch,” and at full capacity, it will “produce 50,000 kilograms of hydrogen per day to fuel zero-emission trucks and cars.”

In July, InvestorPlace said CDZI was one of “3 Under-$10 Stocks With the Potential to Make You a Millionaire.”

And the firm B. Riley Security rates CDZI as a “Strong Buy” right now.

I’m truly just “scratching the surface” of this company, and I really encourage you to do your own research on it. Here are a few things to get you started:

• Another well-produced video on “The Science” behind the company

• And another compelling one on the humanitarian side of the company

• This aerial survey of the Cadiz property and aquifer

• This slick investor presentation dated August 20

• This interview of CEO Susan Kennedy on Bloomberg BusinessWeek Radio

• The company website, which is blessedly intelligible and informative

As always, be sure to approach your trading in a responsible manner. Trading is very risky, and nothing is ever guaranteed, so never trade with more than you can afford to lose. 

Please read the full disclaimer at the bottom of this email as well so you are aware of additional risks and considerations. Always have a well-thought-out game plan that takes your personal risk tolerance into consideration.

Bottom line: CDZI is a company on the march. It has recently diversified its revenue streams and is about to go live with major projects that have been decades in the making.

It spiked 30% earlier this month on great news, only to pull back based on an earnings miss, but yesterday it turned a corner. 

Keep CDZI at the top of your radar today, and let’s see if it defies the markets again!

To Your Success,

Jeff Bishop

👊 Make sure you are getting my mobile text alerts –  text “RAGE” to 1-(888) 404-5747 to get all of my latest HOT STOCK ideas delivered right to your phone (make sure you put the “1” at the front!).  Don’t miss out!