Juli - I hear you, and that was my main concern for a very long time...but at this point I'm not sure we have much of a choice.
INCE's share price simply can not rise under the weight of so many outstanding common shares, especially with the threat of having another 20 million shares added as remaining preferred shares are converted to common shares. Even with a successful alliance deal on the Nanopierce side of the business, and even if Sigma hits $18 million in revenues this year, there just won't be enough profit (for at least 18-24 months, if ever) to bring the fundamental value per share up to a reasonable level. $5/share would be next to impossible.
In the near term I think we're in a salvage mode. INCE has become the classic candidate for a reverse split.... I think if the stock is split after Nanopierce strikes a successful alliance with a major interconnect manufacturer (when the mood surrounding the stock is much more upbeat) then the medicine we need to swallow won't taste as bad.
At these prices...short selling is not an option, so I don't think the price can be forced down to pre-reverse prices by shorts. And there won't be a ton of selling by existing shareholders in the near-term after the price is artificially driven up by the reverse, as everyone's cost basis will be increased by the same ratio as the split.
My avg. shareprice is $0.80 some cents.... if a 1:3 reverse occurs my avg. price will be $2.40+. A 1:3 reverse should cause our $0.11 stock to climb to at least $0.33 on the opening. With 2/3s fewer shares hanging over the company I think the price can get above $0.50 right away after the reverse.....if not closer to $1 (given a few weeks of solid base building, based upon solid news out of NPCT and Sigma).
Timing is everything..... a reverse at this exact moment would probably be detrimental, however after a few pieces fall into place it should probably be beneficial.
I hate reverses, but I've come to the point where I understand that this company can not carry 40-50 or 60 million shares.
It'll be interesting to see what comes of all this.... I've lost 90% of my investment to date, and I feel strongly that I'm not going to get it back unless the capital structure is addressed. A reverse will limit my leverage by reducing the number of shares I own from 100,000 shares to 33,000, or 20,000, or even 10,000 (on a 1:10)...but the value of each share increases when the supply and demand picture is improved, and when new investors begin to perceive that INCE's shares have significant value (e.g., when potential earnings from Nanopierce and Sigma are spread across a much smaller base of outstanding shares) we'll be in a much more favorable position.
Not everyone will agree with my thinking...that's OK. My logic may be flawed. But, I think it's valuable to discuss the issues in a forum such as this. I for one am preparing for what I think is unavoidable .... if a reverse is completed, once it is over...it's over. Hopefully we move up from there.
In closing, my highest hope however is this: If a reverse is done.... I hope Paul never againd sells "INCE Preferred shares". Once the outstanding share level is under control he must not go back to the well again. Not for a very long time. I also hope that with each future aquisition and spin-off each INCE shareholder should get actual shares in each transaction (similar to how we were supposed to eventually get shares in ITCO). I assume there is a way to structure future deals in such a way that this can be accomplished...it's the right thing to do, and doing so will make INCE shares incredibly valuable.
Again, just my opinion...... I wish us all luck as the coming weeks unfold.
Bill |
