SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Technology Stocks : SYQUEST
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: RagTimeBand who wrote (3876)9/19/1997 8:31:00 AM
From: Michael Coley   of 7685
 
RE: Another Theory on SYQT's Price Movement.

Who stands to gain the most with a dramatic upward movement in SYQT? The shareholders? Short-term momentum players? I contend that it's neither. The big winners will be the warrant holders.

These "venture capitalists" who gave SYQT $145 million (which they've graciously used to cover their losses) over the past 15 months didn't do this as a philanthropic act. They did it because they expected a sizable return. How were they expecting to get that return? Through stock price appreciation? Partially. But the biggest aspect is the warrants that they received. Think of them like options, except that the shares will be created causing dilution.

These warrants are mainly based on 120% of a 5 day average, with a cap on the price. This means that a quick (over the period of a day or two) gain of over 20% will be profitable for the warrant holders. That's enough incentive to spend several million dollars pushing the stock price up. Then they can exercise their warrants and get out as others jump on "the momentum bandwagon". Then, the bottom falls out and the stock falls back to where it was before.

That's just one theory. Take it for what it's worth. I honestly hope that you get good news today that will support the rally, but you should also consider the other possibilities.

Just another FUD-spreading SYQT bear / IOM bull,

- Michael Coley
- i1.net
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2025 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News