Has anyone noticed the extreme value here.
Shareholder equity is 10,715,000. With current share structure that equates to .189 per share book value.
Drms management is offering a share purchasing plan for owners on a yet to be determined future date whereby shareholders will be able to purchase twice their current number of shares at .03 per share. In other words if you own 10,000 shares you will be able to purchase 20,000 shares at .03.
The o/s will tripple if all shares are purchased bringing the book value down to .08495.
Drms just announced earnings of .03 for the last q when you take income taxes out of the earnings report which should be done since they have losses that will enable them to avoid paying taxes near term.
They are offering the chance to buy shares at .03 when they earned eps of .03 last q. Revs are way up as are profits and future q's should benefit from their accelerated growth allthough there is seasonality involved and it is hard to determine what the other q's will look like but they are currently showing a rapid rate of improvement that should spill over into future q's.
An arguement could be made that current shares are worth .54 when you factor in the opportunity to buy double the shares at .03.
10,000 x .54 = 5,400
20,000 x .03 = 600
Total cost 6,000 / 30,000 shares = .20 per share and assuming an eps of .01 next year with the improved operations and a p/e of 20.
Volume was up about 20x normal volume on friday and the stock closed up 85% and a pr has yet to be released by the company announcing last q's earnings. There has also not been a pr announcing the opportunity for shareholders to buy shares at .03.
Shares at .03 will amount to 35% of book value after the share restructuring.