surelock, I just did a "fast look" at TMSR, I cannot find any floorless issue. They recently sold shares in a private placement (some 250,000 shares at $16) and for 50 days, the holders have in essence antidilution protection, or a minimum return of 12.5%, since the stock is well above that threshold ($16? or so?), I see no death spiral developing. There might be some pressure on the stock when the 250,000 shares are slowly leaked out, but it seems that the market is absorbing these. I have no opinion on the current valuation of this stock (it looks rich, but who knows what they have up their sleeve), but the chart looks quite strong, and I would not be a shorter because of a small amount of shares coming out. The warrants have a very long fuse and there are less than 100,000 of these, so no source of great pressure there as well.
If you take the position that the stock recent run up was orchestrated to give the new investors a nice profit and thereafter the stock may decline, that could be, but it is a very different thesis that shorting UOLP or even MVIS at $28. In the case of MVIS the warrants constituted a very large part of the total outstanding shares, and in the case of UOLP, a floorless is in place, and these are toxic.
Zeev |
