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Strategies & Market Trends : Value Investing
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To: Sean Collett who wrote (75173)2/22/2024 5:13:40 AM
From: Harshu Vyas1 Recommendation

Recommended By
Sean Collett

  Read Replies (3) of 78782
 
Smart move. Gotta respect it. Issue convertibles at crazy valuations. Those capped calls will probably be a waste but, hey, without them the market might just catch on to exactly what they're implying.

Wonder why they didn't do a "dotcom" and just issue more equity? Would that be too obvious? If there's momentum behind the stock, seems logical (to me). That'd always be the better move, imo.

BYND at the high flyers of 2021 should have done that, too (instead of issuing convertibles). Now with the fear of more dilution, zero hype and more bad news, no investors "want in," leaving their businesses in the dumps. (Also worth noting in 2021 when hyped companies issued such convertibles, it wasn't long before their valuations came crumbling back down to reality.)

Either way, SMCI is up 15% in the pre-market. I also wonder did management deliberately wait for NVDA's results to announce this and hope NVDA's news outweighed their news? Or is this market plain foolish? I suspect the former. Who really thought that NVDA wouldn't blow expectations out of the water?
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