OCNF - have you looked at the recent dilution? I think they have gone from 20mm shares to 90mm shares in about 2 months.
They seem to have availed themselves of the agreement to sell stock below market price via Cornell, which is a firm of ill repute among bulletin board investors.
The number of related party transactions also is a concern.
Another concern is that their fleet was purchased in 2007, mainly, which would be the top of the market. I like to value shippers by valuing the ships. I think the assets may be over-stated at this point.
"As of May 19, 2009, the Company, under the Standby Equity Purchase Agreement, or SEPA, entered into by and between the Company and YA Global Master SPV Ltd., has raised approximately $111.6 million of gross proceeds"
"As of today, the Company has raised approximately $111.6 million in gross proceeds under the Standby Equity Purchase Agreement or SEPA entered into by and between the Company and YA Global Master SPV Ltd. The total number of shares issued and outstanding is 90,394,493 as of May 19, 2009."
Per filings, these new shares have already been sold by YA Global into the open market. That's what they normally do - they get the shares for about 90% of market and immediately sell them off. They used to be a practitioner of the infamous floorless convertibles, until those were regulated away.
"Basic and fully diluted earnings per share $ 0.13
Weighted average shares outstanding 19,926,160
"Purchase Price” shall mean the price per share obtained by multiplying the Market Price by 98.5%."
YA Global would be the Cornell people I think. This enormous dilution occurred without a special press release from the company. Smells.... |
