Greenberg Tea Leaves: Comstock’s Reverse Split

Date: February 24, 2025

Disclaimer: We are simply sharing our take on advancements for our positions. This is not financial advice. These are just our opinions and point of view. Trade your trade.

Comstock Inc. (NYSE: LODE) kicked off a 1-for-10 reverse stock split cutting its shares from 237.7 million to 23.8 million. That bumps the stock from around $0.31 to an expected $3.10 when split-adjusted trading starts tomorrow, lifting its market cap from $13.3 million to about $73.8 million. Reverse splits can be a rocky road—Comstock’s attempts in 2017 and 2019 faded over time, and only about 25% of these moves over the past decade stick long-term. This time, the company’s pointing to a handful of developments: funding talks with SBCC, a biofuels deal with Marathon Petroleum, land sales in Nevada, a big Oklahoma project, and partnerships overseas. Investors have plenty to chew on here—some promising pieces, some real risks. Let’s break it down and figure out what to keep an eye on.

SBCC Funding: Cash on the Horizon?

Back on August 8, 2024, Comstock announced a $325 million funding term sheet with SBC Commerce (SBCC), a private equity group. CEO Corrado De Gasperis said, “These transactions unlock over a half a billion in realized value and secure essential growth capital.” The plan? $200 million for biofuels, $22 million for recycling, $50 million for mining, and $3 million for 7.5 million shares at $0.40. It’s a big number, but it’s still “subject to due diligence” and approvals—no update since August.

• What to Consider: If it closes, $315 million net could bankroll biorefineries and push revenue toward $150–$200 million by 2027. But it’s been quiet for six months.
• Watch For: News in Q1 or Q2 2025 on whether SBCC pulls the trigger.

Marathon Petroleum: A Big Name, Early Stage

On February 6, 2025, Comstock Fuels signed a non-binding term sheet with a Marathon Petroleum subsidiary. The 8-K filing notes, “An offtake agreement for advanced biomass-based fuels a Simple Agreement for Future Equity (‘SAFE’) in exchange for equity until Project Agreements are signed or terminated by June 30, 2025.” Marathon could buy fuels and pitch in cash or assets, but it’s not locked in yet.

• What to Consider: A $70 billion player like Marathon adds weight, potentially bringing $50–$200 million in yearly sales from a facility like Oklahoma’s. Still, it’s non-binding—talks could fizzle by mid-year—and the split news a week later drowned out any buzz.
• Watch For: Final agreements by June 30, 2025. If they sign, it’s a revenue lifeline; if not, it’s back to square one.

Land Monetization: Cashing In or Cashing Out?

Comstock’s got 12 square miles of Nevada land, and it’s not all about mining ($400 million in gold/silver potential). The SBCC deal includes “$50 million … for Comstock’s directly owned real estate and water rights” (August 8, 2024), while the 2023 10-K says, “We continue to evaluate strategies to maximize the value of our extensive land holdings.” Think $25–$125 million if they sell or lease 1,000–5,000 acres.

• What to Consider: That’s real cash to offset a $14.97 million Q3 2024 loss, but $50 million hinges on SBCC closing, and extra sales are just talk so far.
• Watch For: Updates in 2025 on the $50 million and any new deals. Big proceeds could steady the ship; small ones might disappoint.

Oklahoma: The U.S. Anchor

Comstock scored a $152 million bond and $3 million grant in early 2025 for a 75,000-ton-per-year biorefinery in Oklahoma, expandable to 400,000 barrels. De Gasperis wrote on January 23, 2025, “Our bold and strategic moves unlock the shareholder wealth embedded in our Fuels  segment.” It’s tied to Marathon’s potential offtake.

• What to Consider: This could mean $50–$200 million in revenue, but building it’s a slog—construction delays or cost overruns could eat into gains. It’s a cornerstone, not a guarantee.
• Watch For: Progress keeps the story alive; setbacks could sour sentiment.

Foreign Deals: Going Global

Comstock’s reaching overseas too. On January 30, 2025, it expanded with SACL Pte. for 300 million gallons of biofuels yearly in Malaysia and beyond, with De Gasperis noting (August 8 context), “This validates the direction of our management team.” A February 13, 2025, deal in Pakistan with Gresham’s Eastern starts at 75,000 tons, scaling to 1 million tons/year.

• What to Consider: These could add $150 million-plus in revenue, but foreign projects are tricky—regulation, logistics, and partners can trip things up. It’s ambitious, not assured.
• Watch For: Revenue updates in 2025–2026. Early wins could boost confidence; stumbles might spook investors.

The Split Itself: Setting the Stage

De Gasperis said on February 14, 2025, “This action enables us to attract elite investment partners and deliver value to shareholders.” Past splits, like 2017’s drop from $2.50 to $1.20—flopped without support. Now, SBCC, Marathon, land, Oklahoma, and foreign deals offer a shot at $125–$640 million in capital and revenue.

• What to Consider: That could push the stock from $3.10 to $5–$15 (market cap $119–$357 million) by late 2025, beating the 25% success odds. But Comstock’s track record and current losses mean execution’s everything—misses could tank it below $3 again.
• Watch For: Post-split trading in March 2025.

Why No Buzz Yet?

The Marathon news didn’t lift the stock—it’s stuck at $0.31 pre-split—because the split announcement stole the show. Investors see red flags: big losses, past flops, and X chatter full of doubt. These developments—SBCC’s cash, Marathon’s clout, land’s value, Oklahoma’s base, foreign reach—could change the tune, but only if they deliver.

What Investors Need to Track

• SBCC: Does $325 million close in Q1-Q2 2025, or stay stalled? Funding’s the backbone here.
• Marathon: Final deals by June 30, 2025
• Land: $50 million from SBCC, plus more in 2025
• Oklahoma: Progress announcements
• Foreign Deals: Revenue
• Post-Split: $5 or $3 in March? Early trading sets the tone.

The Bottom Line

Comstock’s reverse split isn’t just a price fix—it’s paired with moves that could shift its $13.3 million market cap to $119–$357 million if they pan out. SBCC, Marathon, land, Oklahoma, and overseas deals give it a 40–50% shot at bucking the 25% success trend, but the risks are real: deals could flop, timelines slip, and sentiment sour. There’s promise, but no promises.