Sankar - you sez "I have no problem with others' opinions as long as others have no problem with mine especially that it does not make sense to expound a low of $3 because of "floorless" convertibles. "
while it is good we all have to do our own DD, but I think there are different audience here. Other than conjectures, the facts are this:
1. according to yahoo profile, CTYS has 31.9M shrs outstanding with the book value of $7.07. That translates to ~$226M book value.
2. according to you, as related from Zeev to me, CTYS has a max of 100M shrs authorized.
3. a cursory read of the last 10Q (disclaimer: I am clueless in reading financial documents <g>,) some of the pfr has a conversion rate of 120 based on the 20 days (?) closing average.
4. (this is an assumption) very often, a distressed security will find its ultimate support at the book value (note: this is a generous assumption, chk out West Coast Entertainment (?), and you know what I mean.)
Therefore, assuming the worst case (for the benefit of the cautious investors - which probably excludes me <vbg>,) the ~$226M book divided by the ballooned total shrs of 100M!
Now, even this incurs a lot of assumption, simply b/c I don't know the details, such as how the conversion works. Having that said, to a would-be investor, it is better to be cautious.
rgds Bosco |
