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Post by mnkdfann on May 11, 2016 13:42:14 GMT -5
I do not think your last observation is necessarily true. The institutions who bought into the offering can (presumably) sell the warrants and make a profit on the trade without the shares ever getting close to 1.50. Isnt the exercise price on the warrants 1.50 Yes. But the warrants have a value (price) even when the share price is under 1.50. Maybe the warrants have a value of 0.20 and MNKD is trading at 0.93 when the warrants are issued. If the MNKD share price goes up by 0.40 a week later, the warrant value might jump to 0.50. So they could sell the warrants for 0.50 that had a value of 0.20 when they were first bought. They make a profit on the trade, even though the MNKD share price is only 1.33 and below 1.50. |
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Post by factspls88 on May 11, 2016 13:49:48 GMT -5
I own more than I had ever planned to own. I'm sitting pat.
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Post by victoria on May 11, 2016 13:54:03 GMT -5
I'm all in. However last time it dipped well below a dollar I bought a lot of $1 2018 calls which were then out of the money (I even sold stock to move to calls). But then I am (a) a serious loser on MNKD so my judgment is probably well off and (b) I seem to take more risk than most would see as wise on this. Ive not looked at current options pricing since Im not in a position to spend any more anyhow.
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Post by sportsrancho on May 11, 2016 14:16:42 GMT -5
I'm all in. However last time it dipped well below a dollar I bought a lot of $1 2018 calls which were then out of the money (I even sold stock to move to calls). But then I am (a) a serious loser on MNKD so my judgment is probably well off and (b) I seem to take more risk than most would see as wise on this. Ive not looked at current options pricing since Im not in a position to spend any more anyhow. I'm about ready to buy more:-) Calls and shares. I want the 2018 1.50 calls as cheap as I can get them. Before the ADA I'll take some profit off some other stocks and add more. |
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Post by sportsrancho on May 11, 2016 14:30:14 GMT -5
Everybody needs to lead their own horse, but when we dropped to .64 I purchased a nice block @ .68 with the intentions of trading it around my core. I sold all shares purchased under a buck @ $2.05 then held the profits until yesterday when I bought just over 5k more shares that I will again sell for profit when the time comes. Trading around my core position has allowed me to add over 10k more MNKD shares, and diversify my portfolio with positions purchased from profits, (free shares). So in my opinion, anybody that doesn't see the opportunity to profit on MNKD shares under a buck is missing a golden opportunity. The only catch is you need to be satisfied with the amount of shares you hold in your core, and set your sell limit and stick to it on the new "cheap" shares. Nothing wrong with skimming a few profits on cheap shares IMO. Good Luck Everybody Nice! Congrats. Great advice. I trade around my shares in my Roth ( get 100 free trades a year). I'll start dipping my toe in tomorrow, why wait:-) |
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Post by Deleted on May 11, 2016 14:40:18 GMT -5
Isnt the exercise price on the warrants 1.50 Yes. But the warrants have a value (price) even when the share price is under 1.50. Maybe the warrants have a value of 0.20 and MNKD is trading at 0.93 when the warrants are issued. If the MNKD share price goes up by 0.40 a week later, the warrant value might jump to 0.50. So they could sell the warrants for 0.50 that had a value of 0.20 when they were first bought. They make a profit on the trade, even though the MNKD share price is only 1.33 and below 1.50. Ok, I follow you. I am hoping that who ever these funds are they sold it to will try to maximize this deal. Computer trading all day today. |
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Post by petech on May 11, 2016 14:49:05 GMT -5
Agreed. I sold a bunch of shares to go with $1 strike 2018 calls under 33 cents...so above 1.33, I have 3X the amount of shares helping me get back to even (or...dare I say it...a profit).  |
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Post by saxcmann on May 11, 2016 14:56:56 GMT -5
Hey, not looking for advice. Just curious if others are having similar demons visiting them. My gut tells me to go to the well one more time (I usually listen to it). My heart tells me to hold and not be greedy (not so disciplined). Nearly 6 years, half a dozen buys and a couple sells and I'm as unsure today as I was in 2002. At this point I'm all in and (like most of you) seriously under water. But I can't seem to shake that little guy sitting on my shoulder. Ugh! I must say feeling the same way and similar history...by the way,I bought more today. |
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Post by matt on May 11, 2016 15:44:19 GMT -5
Yes. But you don't have to exercise the warrant you can sell it instead. The A and B pair together are worth about 50 cents (less after the pps drop today!) Your thesis is generally correct, but the warrants are worth more like 18 to 20 cents. The closest traded comparable is the January 2018 call options with a $1.50 strike price which closed today at 21 cents. Those are options to buy a full share, the warrants MNKD just sold are fractional warrants so they are not equivalent to a call option on a full share (you can combine warrants to buy full shares of course). Finally, when a warrant is in the money it creates a form of self-dilution because you are paying $1.50 for something worth more than $1.50. That dilution comes from the existing shareholders and from yourself when exercising because the number of shares is increasing, while a call option does not change the number of shares outstanding. Thus a call option with similar terms is always slightly more valuable that the equivalent warrant so the fair value today is somewhat less than the call, which is at 21 cents. At any rate, the warrants should start to trade in a day or so and the price will be readily observable in the market data. As to whether this is a buying opportunity or not, from a purely arbitrage pricing aspect the shares have a bit further to fall to reach the equilibrium price. The new issuance was $1.03 and that included a share and the warrants. I just described how the warrants are worth approximately 20 cents, which implies a fair price on the share of 83 cents. I am primarily a capital markets guy so I would not be surprised to see the PPS drop another nickel or so before forming a new base price. From there it is upward based on the business improvements. |
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Post by Deleted on May 11, 2016 15:47:03 GMT -5
Yes. But you don't have to exercise the warrant you can sell it instead. The A and B pair together are worth about 50 cents (less after the pps drop today!) Your thesis is generally correct, but the warrants are worth more like 18 to 20 cents. The closest traded comparable is the January 2018 call options with a $1.50 strike price which closed today at 21 cents. Those are options to buy a full share, the warrants MNKD just sold are fractional warrants so they are not equivalent to a call option on a full share (you can combine warrants to buy full shares of course). Finally, when a warrant is in the money it creates a form of self-dilution because you are paying $1.50 for something worth more than $1.50. That dilution comes from the existing shareholders and from yourself when exercising because the number of shares is increasing, while a call option does not change the number of shares outstanding. Thus a call option with similar terms is always slightly more valuable that the equivalent warrant so the fair value today is somewhat less than the call, which is at 21 cents. At any rate, the warrants should start to trade in a day or so and the price will be readily observable in the market data. As to whether this is a buying opportunity or not, from a purely arbitrage pricing aspect the shares have a bit further to fall to reach the equilibrium price. The new issuance was $1.03 and that included a share and the warrants. I just described how the warrants are worth approximately 20 cents, which implies a fair price on the share of 83 cents. I am primarily a capital markets guy so I would not be surprised to see the PPS drop another nickel or so before forming a new base price. From there it is upward based on the business improvements. Matt- Is this offering set in stone for tomorrow? Or could the institutions pull back on the amount like TASE because of the price dropping significantly the past two days. |
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Post by longinvstr on May 11, 2016 18:09:12 GMT -5
Gotta be set in stone. Deal had to be inked (but not yet dry) when the PR was released Mon after the CC. It would not surprise me tho, if the intl partnership deal(s) that flopped last minute was the result of "outside" pressure. We know the rug was tugged, and partially pulled, after the TASE announcement. There's probably a lot of Godfather talking to interested parties by BP & friends to sway away potential partners.
There was a statement made recently that he Mexican Govt is completely corrupted with illegal drug money. I don't see ours as much different. But, ours is "legitimate" corruption b/c the game is played with pharmaceuticals. MNKD's story is a near perfect reveal of the interconnected & corrupted interests of BP, financial instns, FDA, media, etc. Matt & MNKD are forced to sail in headwinds from all directions.
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Post by anderson on May 11, 2016 18:18:39 GMT -5
People here must be lazy to ready the SEC statements themselves. From investors.mannkindcorp.com/sec.cfmprospectus filed pursuant to rule 424 Near the top of page S-9 "We currently anticipate that the closing of this offering will occur on or about May 12, 2016, subject to customary closing conditions. On the closing date, the following will occur: " |
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Post by Deleted on May 12, 2016 8:29:38 GMT -5
People here must be lazy to ready the SEC statements themselves. From investors.mannkindcorp.com/sec.cfmprospectus filed pursuant to rule 424 Near the top of page S-9 "We currently anticipate that the closing of this offering will occur on or about May 12, 2016, subject to customary closing conditions. On the closing date, the following will occur: " I did go through it. I dont know if this was directed at me but I will take a stab at it. Its not very often I admit weakness but I suck at thick reading comprehension. Good with numbers but I couldnt make out if this was set in stone |
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Post by uvula on May 12, 2016 8:55:10 GMT -5
If I buy a stock today it doesn't "close" for a few days. This doesn't mean I can back out of the deal. It just takes times for money make its way through the system.
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