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Post by alcc on Jun 29, 2014 10:19:35 GMT -5
$11.20; $14.40; $13.60
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Post by rockyp on Jun 29, 2014 11:59:28 GMT -5
Some random musings:
Who bought after the announcement on Friday?
I would guess it was primarily institutional shorts that had the wherewithal to trigger the sell off and were "at the helm" so to speak during the last hour of trading. Also, current longs who were fortunate enough to be on-line and had time to put down their glass of Ouzo and spot the buying opportunity may have bought more (although many of them probably bought calls instead of shares) and some institutional investors who were waiting for approval to open or increase their position. Probably some retail shorts that were buying on the rumor and selling on the news may have had buy orders in at $9 or so and they probably covered.
Who DIDN'T buy Friday after the announcement?
A whole lot of people that would have liked to have bought had they been aware of the approval and the stock price, but were either in an airplane (like me), at lunch (like my buddy), at the gym, at work driving a taxi or serving cappuccinos or teaching Econ 101, house hunting in Siberia …. all those things that Longs do. It all happened so fast that most folks weren't aware of what was going on and in a position to act on it until after the market was closed. Also, the Shorts who had been drinking AF's Kool-Aid and really expected the FDA to reject Afrezza wouldn't have had buy orders at the $8-$9 range to cover their positions, because they expected to be able to cover when the stock dropped to less than $2. A few of the lucky ones may have been aware of what was going on and therefore able to cover, but just like the Longs, most of the Shorts would also have been off-line Friday afternoon and busy doing whatever Shorts do (burning ants with a magnifying glass, kicking kittens, etc.)
Who sold after the announcement?
I'm guessing not many folks sold intentionally. There wasn't enough of a spike to get most folks to sell on the news. I think it is safe to say that most of the selling was due to stop-loss orders. You almost feel sorry for the casual investor who had a couple thousand shares but didn't follow the stock closely. They probably got home Friday evening and saw on the evening news that Afrezza was approved. When they went to check their account only then would they have realized that their shares had been sold.
Where do things stand now?
The market has had time to digest the label. I think the consensus is that it is a pretty good label, with no big surprises. We expected there to be follow up studies required, we expected Afrezza to be contraindicated for asthma and COPD and not recommended for smokers. We can complain a little about some of the wording, but all in all the label was pretty good. That's important for a couple of reasons. First, it is just generally bullish for the product going forward. Second, it should help accelerate partnership negotiations, or at least not delay negotiations like an unexpected label would have. You could imagine that maybe a deal was already in place and only contingent on getting approval and having the partner/buyer review the label. If there is nothing surprising to the partner, I could see the deal getting consummated fairly quickly.
What happens, Come Monday?
Who's buying on Monday? Probably all the folks who didn't buy on Friday but would have liked to! Including, 1) Adam's ant burning army of shorts who desperately need to cover, 2) Institutions that were waiting for approval to open/increase their position, 3) Mom and Pop investors who had never heard of Mannkind before this weekend and want to get in on the "ground floor" (from their perspective), 4) Longs who lost shares on their stop-loss orders. 5) Folks who thought the stock was worth $10.58 before approval and think the stock is worth even more now that a major risk is removed.
Who's selling on Monday?
Now that everyone has had time to catch their breath, I am not sure that there are going to be many sellers until the price goes up significantly. That being said, I think the price is going to go up very quickly, because of all of the demand. At a minimum there are at least 30M or so short shares still to be covered, and that assumes that every single share that was purchased after the announcement on Friday went to cover a short position. Also, of the 38M or so shares that traded after the announcement, I have to think that a lot of the ones that were sold through stop-loss orders will be replaced by folks who have spent the weekend kicking themselves for having the stop-loss orders in place. Being the last day of the 2nd quarter, you could see some institutional profit taking, but I have to think that on the heels of the approval any sell-off would be counterproductive so I think that selling will be muted and I don't think that is going to be a significant factor.
We can certainly expect some negative articles to be posted tomorrow morning from the usual suspects, but I have to think that fewer and fewer people are going to be buying that snake oil. It wouldn't surprise me if there is another bear raid to try and run the price down again, but hopefully anyone with a stop-loss order has canceled it and replaced it with a buy order at $10.58. It is definitely going to be a seller's market tomorrow. Hopefully sellers realize that and don't sell too quickly.
If you made it this far, thanks for reading and sorry for rambling. This was mainly an exercise for me to get my thoughts down on paper so I could get my head around everything that has happened.
GLTA
PS: Just so I can be shown to be as wrong as the next guy, I'll guess $13; $20; $18
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Post by MnkdMainer (MM) on Jun 29, 2014 12:03:47 GMT -5
You did read that. But it was also written that there were assumptions of a less friendly label than we got. The label was a wild card and apparently turned mainly in our favor. Not ready yet to make a high low close guess but will be tomorrow. But feel free to make the first guess! Or maybe send Pm's to one person and that person discloses the guesses sometime after opening on Monday. Since approval always comes with label, if label not priced in, what does approval priced in mean? Soon enough then, partnership will be priced in, but not the quality of partnership? I agree with Baba, Slushy, and the others who said the label was key. And I think the same is true of the quality of the partnership. Some possible partnership scenarios would be seen as negative. But those scenarios are very unlikely at this point. The likely partnership is NOT priced in ... yet.
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Post by BD on Jun 29, 2014 12:12:49 GMT -5
rockyp, great tour-de-force write-up. You should have submitted that as an SA article (and without watering down any of the short-seller characterizations )
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Post by spiro on Jun 29, 2014 12:25:02 GMT -5
Approval is not priced in yet. Monday or Tuesday's close will be the starting point and then the hype starts all over for the partner or possible buyout. I still wouldn't mind a $12 - $15 billion Afrezza sale, with MNKD keeping production and getting some milestones. But because of the good label, a total buyout of MNKD may very well be on big pharm.'s mind now. My guess, Al would sell for $30 billion. Let the bidding war begin. Who was it that thought MNKD's market cap was too high when MNKD was selling for $6.00 ? Isn't it nice not to have to worry about another CRL and we can still hate the FDA.
Spiro here, When it's approved, it's approved, but where's the partner?
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Post by BD on Jun 29, 2014 12:35:33 GMT -5
spiro, two of the words from your post above stand out as my definite favorites: "bidding" and "war"...
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Post by liane on Jun 29, 2014 12:48:06 GMT -5
My thought is up on Monday. Such chaos often has swings in both directions to shake everyone loose. We only saw the downdraft on Friday. So upward would generate some pressure on the shorties' margin accounts. Bring it on.
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Post by chmith27 on Jun 29, 2014 12:50:01 GMT -5
rockyp, i really enjoyed your post. you make a good point that with the label being about as good as we could have reasonably expected, and one that has nothing unexpected, it's almost as if partnership is a stroke of the pen away. this is assuming we haven't been fed any untruths or exaggerations by mngmnt, and you would think their first slap on the wrist to the tune of 16MM would've curtailed any further slips of the tongue. you mention 20 out there as a guess for the high, and while i would put it around 14, can you imagine sometime this week with all the attention and covering we will be seeing, what would happen if any partnership were to be announced soon? i put the % at about 20% for an announcement this week and maybe 80% chance within a month. matt mentioned as long as 6-8 weeks post approval but i have to believe that was in the case of a difficult label. now it really comes down to whether mngmnt has been feeding us good info or not. if they have been honest then we should see a partner really, really soon. also, they can't come back and say "the partner didn't want to pay what we were asking", because if that were the case, then we've been lied to this whole time. that would be like me selling my house and telling my wife that i have some buyers ready to buy and she gets all excited. but if i'm asking 400K and they are willing to pay 200k, then i never had any buyers in the first place, right? also, i don't have a wife and my house isn't for sell
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Post by spiro on Jun 29, 2014 13:31:19 GMT -5
chmith27,
I share your concerns about the possibility that MNKD has been feeding us fortune cookies. But, I am very confident that Greenhill researched MNKD with a fine tooth comb before they jumped in. Greenhill has been licking their chops after reading the Afrezza label. I think a deal will happen pretty fast, unless a huge offer comes out of nowhere from a suddenly more serious company. But, I still think that Greenhill will not give them much time to ink their offers.
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Post by chmith27 on Jun 29, 2014 16:40:11 GMT -5
i've been more excited about this week than i have been for any other trading sessions, ever.
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Post by coco on Jun 29, 2014 19:40:36 GMT -5
I second that. How sad is my life when I want the weekend to hurry up and end so Monday morning will be here. Lol. Its gonna be fun. Cooc.
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Post by babaoriley on Jun 29, 2014 21:32:59 GMT -5
Just got back from Palm Springs and 108 degree golf, although we were finished both days when it was only about 103! Still, tough on an old guy...
Read this excellent thread, rockyp, that was a wonderful post, thanks! And everyone's comments are excellent. And I even recommended Spiro's post even with that dagger he tossed in my direction!!
I haven't even looked at my account yet to see which of the calls I tried to close on Friday afternoon were actually executed; I know not as many as I intended were, but the price was back to rising so fast it was difficult to hit the target.
Couple of random thoughts:
First, if the wrong people got stopped out in the $8's, there's going to be an investigation and maybe more, I would be very, very mad if that happened to me (true, you wouldn't want to give people the opportunity to stop you out, but if the whole thing was a setup so that a select group of shorts could get out, and it appears that's exactly what occurred, then that's just too disgusting).
Second, if indeed, as documented convincingly here, the FDA did the first announcement, well, I just don't know what to think. My guess is MNKD intended to wait for the market to close before announcing the great news they had received during trading. Did some underling at the FDA "slip" up - just too weird.
Third, the widespread coverage of the approval, including mention by Brian Williams, was more than I anticipated. It was almost as if the media gave us our first big TV commercial which I've been anticipating post partnership. This has thrown my intuition for a loop, and I'm unable to have any kind of confidence in what to expect tomorrow. I'm sure now that there will be plenty of people wanting to buy in based on first impressions formed just this weekend, maybe even just 100 -1000 shares, but they will be there. Many, many people who never heard of MNKD were exposed, and only a small percentage of them need to act in order to fire up the cauldron early tomorrow.
Fourth, if a group of shorts could create chaos Friday afternoon, they can do it again, perhaps not Monday due to the short selling ban, but perhaps sometime soon. Thus, it may be a good idea to have a couple of good till cancel orders to buy at a much lower price - might as well be a benefactor of the crooked goings on in our stock market!
Fifth, if this were a Canadian stock and a Canadian dominated board, I could almost guarantee we'd be going down tomorrow, invariably when Canadians get too giddy based on news, etc. and are lighting up more cigars than Red Auerbach ever did (15% of you get that reference?), they are ambushed the very next day!!
Sixth (as in sense), if I have a moment of elucidation later on, I'll be sure to post, but I right now I feel like I just spent four lonely days in brown LA haze. LOL, 35% get that one?
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Post by rockyp on Jun 29, 2014 22:24:18 GMT -5
I second that. How sad is my life when I want the weekend to hurry up and end so Monday morning will be here. Lol. Its gonna be fun. Cooc. Think about the weekend the Shorts have been having. They haven't been enjoyin' the scenery (35%). They were caught with their pants down and have had the entire weekend to wonder what Monday holds in store for them. We've all been there: You are indisposed and the phone rings and you can't remember where you left your phone and you come shuffling out of the bathroom with your pants around your ankles, searching for your phone, scooting along from dresser to nightstand to, Lord help me the kitchen table, with your feet shackled in your relaxed-fit Dockers, looking like a cross between the Little Tramp and a duck. The shorts have been waddling around like that since Friday. Yeah, I think they will be pretty anxious to buy, Come Monday.
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Post by babaoriley on Jun 30, 2014 0:01:56 GMT -5
I figured this one will rise until it gets high enough for short sellers to short and day traders to sell. However, if it is accurate that no short selling will be allowed tomorrow, wow.
I could see $10.75, $14.50 and closing at $13.25.
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Post by mnkdfan on Jun 30, 2014 0:04:57 GMT -5
Great post Rockyp!!!the shorts owe us one big catalyst boost up for a pay-back. Pay back can be a bitch when they drove our stock price down to $4.00 right before the Adcom meeting. Although I continue to believe in the product, I did not sleep very well the night before the adcom meeting thanks in part to those manipulative shorts Bastards!!!
Good luck everyone and hopefully we'll have a good morning....
MNKDFAN
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