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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Paul Senior who wrote (29288)	12/19/2007 11:22:44 AM
From: Jurgis Bekepuris	Read Replies (1) \| Respond to of 78748

ACAS - I was almost convinced to buy this one based on the Motley Fool article and various posts on the group. And then I saw the secondary offering. I really hate secondaries. There are always only two explanations for secondaries: either management thinks that their shares are overpriced, so there's no point to buy them; or the company is in trouble to raise capital and then there is no point to buy the stock either. Of course, they always have explanation that they will use money for spectacular opportunities and this may be a bit closer to truth with ACAS who cannot borrow for those opportunities, but still it all comes at expense of existing shareholder dilution. And apparently it's not the first time either - their share count has increased from 150M to 180M since last year! They have done a lot of share offerings all the time, so it looks like ACAS is in the business of selling its shares more than in any other business... :(