Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Gold/Mining/Energy : Big Dog's Boom Boom Room -- Ignore unavailable to you. Want to Upgrade?

To: microhoogle! who wrote (98396)	3/28/2008 10:10:49 AM
From: ChanceIs	Respond to of 206223

RE: CHK...>>>Everytime it is ready to go up - they themselves figure out a way to suppress the share price by dilution or debt.<<< There is some truth to that. You have to look a little closer however. The previous sale of convertible bonds (Sept '05)was done at a local maximum with the stock have almost doubled since May '05. You might argue that it was the sale of the convertibles that stopped the advance. There is something to that line of thinking. I would argue that the strike price of the embedded calls were 10%-15% above the market price on the day of issue. (I am just guessing at the percentage, but they are almost always sold at a premium. One of the homebuilders issued convertibles with a strike below the market last fall. I shorted immediately and made out like a bandit.) If those options get exercised, then the new equity holders are buying in at a higher price. That is good for the current shareholders. Besides the corporation gets a lower rate that way. You are looking the gift horse in the mouth when there is an issuance after the price doubled in four months. Be fair. We have the same situation with the current equity offering. The price has had a big run-up. Only about 30%. Not as nice. Looking at the really big picture, you are complaining about a stock that has averaged 100% appreciation per year over the last four years. You can't beat that with a stick.