I think the stock is in the basement because of the $10 million financing with convertible preferred, meaning that down the road, those shares will be dumped into the market at a discount from whatever the market price is then. So, we have a company showing EPS losses with a huge potential overhead of selling (dumping) diluting current investors coming down the pike.
We are supposed to be glad because you will be the proud owner of a smaller piece of a larger company. The question is no one knows just how much larger, or exactly how much dilution will occur, and when. The "Invest With the Masters" newsletter has been touting this stock as a George Soros favorite. That was about the time the stock really began to tank. Now you tell me, who is smart and who is dumb?
To their credit, the company has been steam rolling contract after contract of HMO deals for hearing services, and this is really a big market. If they capture the lions share of it eventually, assuming the HMO idea isn't replaced by still another method, then this could turn into a $50 stock based on lets say, 100,000,000 shares and $5 billion of sales in a $13 Billion marketplace. But that may be many years away, and a lot could change this scenario. Meanwhile we will probably see big losses and heavy dilution as shares are dumped by the preferred holders to recover their returns from financing growth.
Good luck to us all.
Russ |
