Avid Bioservices Inc (CDMO)

[jbainseky]

I still believe the capacity was built for a specific customer's product(s) when they get approved so there was no real selling to do, but it all comes down to if/when they get approved. Always a bit of a crap shoot with the FDA. Part of the reason I believe that is the fact the 2021 convertibles interest rate was so low. I know rates were lower, but there had to be a better place to put $125M than at a rate of 1.5%, unless you have confidence something big is going to happen. I really wish we knew the holders of those notes, and if it was the original owner that pulled the rip-cord on the removal of the legend. I think it is more likely that that one entity that filed the 13G and specialized in convertible notes was a secondary buyer that knew of the legend situation and he pulled the cord and made money shorting and covering because they knew it wasn't a real financial hit. Now tied into all that is the capped-calls. That did give the original note holders immediate "profit" and this time around there are no covered calls, but AVID did at least change the indenture so the same situation can't happen. On a final note, if my hunch is correct, and the capacity was built out for a specific customer that may or may not want to buy AVID, in either case it has to make HALO more nervous.

FFTT
JBAIN

[djohn]

LOL, yes I like the way we are moving. But a year age we were near $19. The fact is that the top management has not yet fully excited their plan leaving us vulnerable to a low ball takeover. If they had we would have we would be enjoying $100mil in revenue per quarter and be at $28-30. I had confidence In Avid but I really don't know now.
It's like during the two+ years they were building out manufacturing their commercial team did nothing. When the new capacity came on line they are at conferences with a booth building the brand????? really. I just retired from a 40 year career in sales and sales management. I guess the old saying is so true.
A manufacturing organization can't sell and a sales organization can't manufacture,

[corporalagarn]

Not sure if this has been posted. From Laughing Water

"Starting with the recent positive industry developments, in early February it was announced that Novo Holdings would be purchasing Catalent Inc. (CTLT), a publicly traded CDMO, for $16.5B. Novo Holdings would then sell three fill-finish sites to Novo Nordisk for $11 billion. The fill-finish assets are the real prize here, as Novo Nordisk is the manufacturer of blockbuster weight loss drugs Ozempic and Wegovy, and there simply is not enough global fill-finish capacity to meet the demand for these drugs.

This transaction also has the potential to be hugely positive for Avid Bioservices, but in a different way. Avid’s largest customer is Halozyme Therapeutics, Inc. (NASDAQ:HALO), who has traditionally split their business between Avid and Catalent. While this business is not likely to be forced to leave the Novo-Catalent facilities as is the case with the fill-finish business, Novo Holdings and Novo Nordisk are both involved with products that are seen as competition for HALO’s products, and industry whispers are that HALO is not pleased with the idea of outsourcing the production of their drug substance to their competition. As such, HALO may seek to take their business away from Novo-Catalent. HALO is thus presented with a choice. They can either a) choose a new CDMO and go through an FDA review to move their production or b) they can move more production to Avid Bioservices, which would not require FDA approval. There are of course sole source risks to be considered, but it seems likely that Avid could pick up meaningful incremental business."

[jbainseky]

@djohn, are we in a positive trend yet? Please do explain.

[MusicBizExec]

Huge 240k trade just hit

[4OurRetirement]

Interesting, 2,000Shares @$8.61 In PreMarket. Glta,eom.

[cheynew]

6 Form 4’s filed.

https://ir.avidbio.com/sec-filings

[cheynew]

A million shares traded so far.

[jbainseky]

Will 7.50 to 7.80 be broken??? Still someONE is accumulating.

FFTT
JBAIN

[4OurRetirement]

$CDMO Bulls Need To JumpOver $7.85 LID. Glta,eom.

[4OurRetirement]

Could Cohen/P72 Be Takeover Activist(Or Buyer)? EasyDouble-Glta,eom.

[EndoTarget]

Unfortunately, the journey is ending soon.
Takeover around 15.
Good luck for the rest.

[MusicBizExec]

5 day triple top...lol

[Preciouslife1]

The "Good Old Boy" Network in the Corporate Suite thingy .... They protect their own, while shareholders, who have invested with faith and confidence in them to "Do the Right Thing Always" sometimes, many times fall way short in the Commitment, Integrity and Dignity Department, sadly ...... The shareholders become the "Bag holders" so to speak when they fall short of their fiduciary responsibilities and actions that are deleterious to the share price and prospects of the Company going forward .... Blessings to all long shareholders in CDMO!

[Preciouslife1]

Services rendered. Represents shares sold to cover tax withholding obligations in connection with the vested RSUs.
He still has millions of shares being held so this is a TAX COVERING PAYMENT Sale ...

[djohn]

Why is a CEO given RSU's or options for performance that resulted in a $17 million loss? Come on BOD! Reward for performance not because someone warms a seat in the corner office.
When I was working I wish I was given equity in my company I could sell to cover my tax obligations for not preforming.
Ok, I'm done. Just frustrated.

[north40000]

That sale by CEO is just enough to pay taxes due on vested RSUs or options, per purpose or reason for sale.

[cheynew]

Form 144 filed

https://ir.avidbio.com/node/20776/html

[north40000]

Thanks for the link to the New Yorker article, djohn. I have 2 reasons for reading it and finding it significant:

1) Cohen’s family fund has made a large investment in CDMO, currently one of our largest investments in both capital that we have invested and today’s market value. Our ~ 55k shares have returned to a diminished LTCG state at $7.63, but nowhere near where we were a year ago at a CDMO share price of ~ $18.60.

2) One of the SDNY prosecutors mentioned in the article is Richard Zabel. He is the son of Bill Zabel, one of my high school friends who entered Princeton University in 1954 and accounts for my interest in Princeton. At his urging, I applied to Princeton in 1955, received a scholarship, but got a better scholarship from Northwestern where I graduated in 1959. I accepted the TRI fellowship I received from Princeton for graduate school, and my degree there followed in 1962.

Last I heard/read about Bill, he was a named partner in that powerhouse NYC law firm where he specialized in trusts and estates, and wealth management. He was one of the attorneys representing the wife of Jack Welch, former GE CEO, in her battle for fair estate value in that highly public divorce matter following Jack’s “escapades,” different perhaps from the “less public escapade” we find CDMO has caused us to be in today.

[djohn]

Just to set the record straight. Steve Cohen was never indicted or pleaded guilty of insider trading. He was never looking at jail time.

When the Feds Went After the Hedge-Fund Legend Steven A. Cohen
Inside the government’s nearly ten-year battle against one of the most powerful men on Wall Street.

https://www.newyorker.com/magazine/2017/01/16/when-the-feds-went-after-the-hedge-fund-legend-steven-a-cohen

"They decided to indict S.A.C. Capital, and not Cohen himself."

[horselover45]

Going back many years. I used to have meetings with Steve King. March or April.
One day before our meeting I got the call from Steve's Sec that Dr Thorpe Had health issue's and Steve had to leave.
Not a big deal any more but I knew about Dr Thorpe's problem one day before publication and to say that I was sad and upset is a big understatement.

[Preciouslife1]

WHEN WE WERE "THE PEREGRINE UNDER THORPE" ..... https://www.instagram.com/reel/C4yPtAFuPGD/?utm_source=ig_web_copy_link

[westjtter]

Well maybe he has some inside information! (lol he says in jest) We all know that he pleaded guilty in 2013 of insider trading at his SAC Capital fund and paid just under $1.2 Bil in fines...and of course managed to stay out of jail!

In 2014 he opened up P72 under his name and in 2018 the fund was opened up to outside investors. So apparently he has been behaving himself and the fund has done very well as no doubt, he is a very smart man!!!

So yes he may be Steve Cohen, but right now he is our Steve Cohen and lets hope we all benefit from P72 owning this amount of Avid shares....I hope he keeps buying and perhaps even becomes a shareholder activist....things appear to be a little too cozy right now in Tustin...maybe Stevie can shake things up a bit and get this share price moving?!

[Bluerinse]

Good! Hopefully it indicates a deal coming as it's the only way I can get out at a higher price! These clowns need to go, no accountability whatsoever. The only thing they credit for is building out capacity, so now sell it to somebody with business acumen and ethics

[djohn]

P72 isn’t a buy and hold operation

[westjtter]

I don't know if I was too optimistic or just expecting more from Mr Green, but it sure is starting to sound like...the new group is the same as the old group!

The convertible debacle was such a major bungle which cost all of us a lot of upside on the share price, and yet no mention...no firings...no nothing...business as usual, and right now that is not very good!

Nick may have capped our mini run in the share price as I expect we will be lower tomorrow....hopefully Mr Cohen and his band of merry men did not buy this stock only for a trade?????

[djohn]

Well that was a complete waist of time

[djohn]

Mr Hart had a bit of lumpiness last quarter

[ArchieK]

ASK HIM! I'm shouting like Bobcat here. ASK HIM...who can't read and do their job and how did you flip your rate to 7% without someone being ejected from their chair? Asking all this nonsense when the elephant is literally in the room! (sigh..I'm better now)

[hayward]

Near term Sounds like Steve King No after hour trading

Michael

[hayward]

Did I hear that right 7% gross profit ? What the F are these guys doing !!!!!!!

Michael

[ArchieK]

Made it sound strategic even. Not honest IMHO.

[cheynew]

No apology for the note fiasco, not that I expected one.

[cheynew]

Block trade
04/29/2024 15:06:33 EDT 7.65 227500

[4OurRetirement]

Touch $8 Then Have Positive CC? Glta,eom,

[djohn]

Nick's demeanor and who will be on the CC this afternoon will be very interesting. There's only one more day in FY24. Nick has a good idea how Q4 when and how FY25 is setting up. Wonder if Hart will be present?

[djohn]

Now we know where the increase in short interest has come from. P72 is pure arbitrage nothing else IMO. Hold on for a roller coaster ride.

[4OurRetirement]

CC @4:30pmET Link: https://edge.media-server.com/mmc/p/k98krq4b/ Glta,eom.

[eb0783]

I haven't paid attention to him since he was forced out of the fund he created, SAC Capital Advisors, and was relegated to his "family" fund. His name in the filing just took me back to his underhanded schemes. In my opinion, he is not much different than DART. He has the power, knowledge, and experience to do whatever he wants. I don't think he is an "activist" now days. Probably he is just making a good investment. imho

[hayward]

ebo783

In your opinion is he a take over guy ? or someone that tries to push for a sale. TIA

Michael

[eb0783]

That would be the infamous Steve A. Cohen..........

Steven A. Cohen is an American investor and hedge fund manager. He is the founder and CEO of Point72 Asset Management, a family office located in Stamford, Connecticut. As of April 2022, he has an estimated net worth of $17.4 billion.

Cohen is also the founder of the now-defunct SAC Capital Advisors, one of the most successful hedge funds ever. In 2010, the company became the subject of an insider trading investigation launched by the Securities and Exchange Commission (SEC).

While Cohen was never charged, the firm pled guilty to trafficking in nonpublic information and was forced to return investor capital and pay $1.8 billion in fines. SAC was officially closed in 2016 when Cohen began serving a two-year ban on managing other investors’ money. The ban expired in January 2018.
2
U.S. Securities and Exchange Commission. "Investment Advisers Act of 1940, Administrative Proceeding File No. 3-15382, IN the Matter of Steven A. Cohen, Respondent."


KEY TAKEAWAYS
Steven A. Cohen is an American billionaire hedge fund manager and investor known for employing high-risk, high-reward trading strategies.
Cohen began his investment career working as a trader for Gruntal & Co., where his trading generated substantial returns for the company and himself.
Cohen's flagship hedge fund, SAC Capital, was shut down following allegations of insider trading, and the fund was forced to pay nearly $2 billion in fines.
Following the demise of SAC, Steve Cohen was prevented from professionally managing investor money until 2018; at that point, he opened Point72 Asset Management.
SAC Capital's portfolio manager, Matthew Martoma, was convicted of insider trading and sentenced to nine years in prison.

[cheynew]

Point72 filed a 13G with a 5.1% ownership. Previously held 509,831 shares. Now 3,226,006 shares.
https://ir.avidbio.com/node/20771/html

[djohn]

I'm wondering if we get a PR before the market opens Monday with some good news on the sales front or some other positive development?
Then then the CC after market close can focus this instead of the failure of our Financial and Legal Departments.
I am hoping at least someone accepts responsibility at minimum.
Would show some creditability from the C-suite.

[westjtter]

Yup....all about timing also! Hopefully the upcoming CC will offer some positive developments about filling up our capacity, and yes perhaps the market will be a little more welcoming of positive news, so we get some benefit in the share price.

As frustrated as this whole debacle was, Nick is a take care of it guy, or rather that has been his reputation. Hopefully he can pull this thing together again and start reeling in those orders!!!

[geocappy1]

Good sign holding up in tough market. Hopefully.

[djohn]

Putting this behind us should be positive but not the market tanks. Can't get a break.

[jbainseky]

Well at least AVID modified the indenture for the 2029 notes so if they forget to remove the restrictive legend, it is not reason for default!

FFTT
JBAIN

[r622102675]

Will Hart be MIA?…r

[r622102675]

CC Monday after the bell…r

[westjtter]

Yes, very good points...I guess no one was responsible and no big deal??????

But going beyond that, just confirming guidance of $137 mil to $147 mil is not going to get it done! The backlog of $206 mil is great, but a backlog in itself does not add to the revenues. For this stock to go anywhere in the near term(2 YEARS), they will have to start converting this backlog to revenues....to go from $140 mil to $400 mil will take a lot of solid incremental revenue increases every quarter.

Even if they hypothetically increased their revenues by an additional $10 mil per quarter(which they have not been able to do over the last year since they somewhat regressed) that would just take us to $180 mil next year(2025).....$220 mil the year after(2026)......well you get the picture...even with these kinds of increases they have a long way to go to get to $400 mil....lets call this the promised land of $25 to $28 per share.....in the range of 7 years.....that is IF they are able to achieve this kind of revenue growth!

The Laughing Water Capital article and comments seem to indicate closer to a 2 year timetable to fill their capacity....not sure how they arrived at that with current guidance for 2024 of $137 to $147 mil??? That would mean that in 2025 they would pull in an additional $250 Mil in revenue???

I guess we will just have to wait and see if the next quarter finally begins to show some solid growth, as without that, we are not going anywhere quickly!