Good question!
Looking at the chart and the past events, AMRS experienced:
- T-1 offering
- RS 1:15
- T-2 offering
This was quite a triple beating heavily utilized by the market, here the short play of course.
The beating down went so far below any historical Enterprise Value (EV) that even retail longs started to lose faith.
However, it might be simply natural. Even one of above events would have the power to bring a stock 20-30% below offering price for the short term, but usually recovers later on. Now we had even a RS and another subsequent offering.
The nature of the offering is quite different in this case, semantics. Both are being held by long term investors _and_ the new long term partner DSM. DSM also has a BOD seat now and partakes in controlling the company while collaborating.
None of these shares hit the market.
It often is easier to burn down Rome than to rebuild it, hence it needs time to grow confidence in the renewed AMRS.
Another question often arises: Do they have enough funding until 2020? Emphasizing the cash burn and debt payments starting mid 2018 until end of 2019.
This question is surely hard to answer, however, DSM mentioned they had an insider view into company's books and wouldn't have started their investment if financing wouldn't be on solid grounds (-> Investment Day). Further we have the hint in 2Q17's 10-Q 'going concern' filing, where they reduced the warning of not being cash flow positive 'only' into 2018. Indicating that maybe 4Q17 could mark a turnaround.
The best thing to validate the financing capabilities will be 4Q17 ER, with all of DSM's collaboration and maybe product revenues present.
If this is the remaining question based on the big long term short play visible right now, any technology breakthrough disclosure would surely ruin it on such path.
Long term short positions on technology stocks are difficult to say the least.
