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Article published on the stockhead.com.au | Rob Badman

MoneyTalks is Stockhead’s regular drill down into the stocks professional investors are looking at. We tap our extensive list of experts for insight on their top picks right now.

In this edition, we hear from Shaw and Partners Morrissey Group’s senior wealth adviser and founding adviser Ben Morrissey.

And now, for something completely different relevant – activated carbon.

What’s that, then? Also sometimes called activated charcoal, it’s an extremely porous form of heavily processed carbon (derived from coal in this instance) and used to filter various harmful contaminants from water and air, among other uses.

And it happens to be the main game of Carbonxt Group (ASX:CG1) – a stock Morrissey (and Shaw and Partners) has been into for quite some time.

Morrissey has kept faith in the company through a rocky share-price ride and firmly believes it’s now on the cusp of its biggest stage of growth.

CG1’s investment thesis was ‘obvious’

There are a few factors that brought Carbonxt onto the fundie’s radar initially.

It’s an Aussie company with superior tech, focused on the “key addressable” US market in a sector that if still isn’t  on enough radars yet, needs to be, and very likely will be before long.

Morrissey notes that it was an Environmental Protection Agency (EPA) legislation first proposed in the Obama government era that, for him, helped him to see Carbonxt’s full potential.

That EPA legislation, among others now in play, sought to reduce the levels of mercury by more than 90% in coal-fired power stations.

“I thought, well here’s an obvious opportunity,” says Morrissey. “Because if you’ve got a company with technology that is obviously better than its peers, that can actually do that, then demand will go through the roof and the thing will explode.”

“I don’t think they have, no,” replied Morrissey.

Have US competitors then since moved to imitate and switch to magentised and granular activated carbon?\ to bigger companies over there, there hasn’t been any need for technological advancement by the competitors.

“Ultimately, I mean, what I expected to be perfectly honest was, given Carbonxt has the technological advancement, one of its larger competitors would just swoop in and take it over.”

That obviously hasn’t happened, but what has, and what lines up as particularly bullish for the company, is this…

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MoneyTalks: There’s something in the water for Carbonxt, and it could be ‘company making’