Carmine, Jeffrey, I think you're both wrong and I'll tell you why.
When the secondary offering was issued, it was bought by large brokerage houses at a substantial discount from the prevailing price at the time. The brokerages expected to make a profit on their purchases, and Iomega had no reason to want to piss them off by deceiving them. Furthermore, Iomega management had no way of knowing that their share price would fall after that. That was still quite early in the second quarter, a quarter in which they were doing very well.
Do you think they knew how much Wall Street would overreact to the announcement of the LS-120? Do you think they knew in May that ALL the techs were suddenly going to get hammered in July?
If they didn't know those things, and they had no way to, then how could they have known their share price was going to fall?
They made the secondary offering because they needed CASH to ramp production.
And to this day, no one has shown me any evidence that they have actually bought back shares at a lower price. The Board authorized them to do so, and that is all.
No foreknowledge, no buyback. No short.
I don't try to BS anyone, Jeffrey. But you just go ahead and think any way you want to. Whatever makes you feel good.
- Allen |
