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Evergreen (NYSE:EEE) keeps getting fingered by Asensio for highly inadequate results. Asensio has a remarkably accurate record for identifying problem companies and sometimes problem managements. In this case Evergreen has been promoting something called K-Fuel. Quoting from Asensio’s recent press release where they have quoted from recent Evergreen’s reports “What were the results? After all the hoopla, today EEE admitted that total K-Fuel sales have amounted to the paltry sum of $192,000. EEE achieved this remarkable $192,000 sum by selling an undisclosed amount of K-Fuel to some undisclosed customers for an undisclosed selling price, produced at undisclosed cost.”

Asensio has also identified that Evergreen “$17.2 million in what it called "plant start-up costs" and $31.3 million in capital expenditures in the nine months ended September 30, 2006. These "plant start-up" costs are in addition to the over $166.1 million and over 4 years EEE has spent on a scheme it claimed would only cost $20 to $25 million and take only 9 to 12 months to build when it started.”

Asensio has made a fortune in short selling. I do not have any insights into their position. But Evergreen was as high ranging around $20 last March 1, 2006. It has recently dropped to under $10. The question becomes can the short position if one exists follow the stock to significantly lower levels (say under $5), or should covering start to occur. Short sales are bullish indicators because the stock eventually has to be repurchased. It does not appear that corporate fundamentals will come to the stocks rescue.

This stock is not for the faint of heart. But it does have a lot of drama.

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