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Large volume at the open. Half a million shares in the first few minutes. It is options expiry/triple witching day today but I don't know if that's got anything to do with it.
I think all of the MAB therapies are known to be most effective in the early stages of the disease, roughly the first 7 days or so.
Bond yields down, HALO moves up. Know I'm sayin?
The convertible buyer had absolutely no risk and has undoubtedly already profited from a short position taken in anticipation of the deal: Insider trading at its best.
Whatever they make down the road is gravy, in the best tradition of convertible debentures.
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On the surface you are correct as far as it being a growth stock but the pricing calls I have been making have been pretty accurate in the last year or so; that leads me to empirically believe that that is how the money managers are seeing this play, which is, in the end, all that matters.
To compete agains the bond market offering higher rates HALO's pps has to come down. That's part of what we're seeing here, besides the fallout from the refi/convertible mess. My estimates were based on a theoretical 2% return in a quasi dividend brain experiment. Formerly, this justified a 50 multiple times eps.
Now the math has changed and not for the better. What is the correct new multiple?
A 2.5% "return" or "dividend" would chop that multiple right down to 40. It gets worse from there.
End of year projections are for ~$1.50 eps.
So, 40 X $1.5 = $60 by end of year instead of my earlier, and sadly naive, estimate of ~$70-75.
Can you say: perfect shitstorm"?
The uptick in interest rates really screws up my price model for HALO
I'm back to Wondering about that gap at ~$34. Currently right at the 200 DMA.
It was a clear story before, easily understood, (just the kind of investment that Buffett loves).
Now the waters are muddied considerably. They always emphasized they needn't go to the well anymore for financing, but now they look like they've mislead everyone. That pisses people off and people have long memories.
In addition, there are the free 9+ million shares they just gave away to the previous noteholders, who are undoubtedly liquidating as we speak. All in the name of what? Some bullshit "financial engineering" notions. It's like WAZE sending you through a sketchy neighborhood to save you a net 30 seconds on your commute.
I'm remembering also that we have a new CFO, Elaine Sun, who replaced Laurie, under sudden circumstances, not too long ago. Then this crock of crap follows. WTF?
All of these things may work out in the end, as you suggest, but in the meantime, lots of unclarity.
The Capn' and Little Buddy made their $$$ on this stock scam. They walked away unscathed by their shenanigans and outright thievery. They are the ones laughing, unfortunately.
This deal was is not being received well. Look at the pps and volume just after the conference call last week, and then compare that with the plummet after the refi was announced. We had a $43 handle today. All time high was over $56. I'm not happy.
-Fritz
Oil can! Oil can!
In asnwering a question about possible acquisitions, Helen in the call said, in so many words, that they don't see a deal on the horizon at this time. At least that's how I interpreted her comments.
I have never been a huge fan of the buyback program. They keep talking about "returning value to shareholders" but there is no return to me unless the company either starts paying a dividend or is bought out. Neither one of those strategies is overtly embraced by management at this time.
I agree and think it is a generally confusing chain of events.
*Issuing stock to close out the prior deal at the same time they are trying to repurchase and retire shares is weird.
*Plus, they really have no obvious need - and have said so numerous times - to raise additional cash.
*They will have about $300 million additional dollars in the kitty (broadly speaking) after closing out the prior debenture, at close to zero cost, but there is the dilution effect of the 9 million newly issued shares.
Head scratching. I'm assuming a net benefit when all the dust settles, but it is hazy.
New All-time Intra-day high yesterday: $56.40
The one thing that confuses me about the previous convertible debenture was at the conversion rate was $23.85 and with the price hovering around 50 bucks for the last month or so, I would be surprised to learn that the note holders haven't already converted. The only way that that they wouldn't have would be if the terms of the agreement prohibited them from converting until the expiration of the note. Anybody have any thoughts on this?
This deal is being used to retire a previous deal with much more favorable terms
That's how I read it anyway. I'm willing to admit that I could be wrong.
Agreed that HALO was not the source. The price and volume took me by surprise after what I saw was a very vanilla conference call.
Yes, this is very good new and we should see another leg up start to take shape.
Do you think word was out yesterday?
I didn't hear anything that would cause me to upgrade my PT. The analysts who were lagging may have to catch up though.
What I said in January and earlier than that still holds IMHO:
https://investorshub.advfn.com/boards/read_msg.aspx?message_id=160825744
I haven't seen any upgrades cross the wires yet.
Looking good
Progress in Sub-cu Efgartigimod was discussed in some detail yesterday during the Halozyme conference call.
One other thing that struck me yeasterday was that Helen was a lot more subdued when asked about HALO buying another company, almost to the point of pushing it aside as an idea. This is just me reading the tea leaves, but I feel, as I always have, that HALO is positioned as more a buyout candiate than an acquirer. If they were on the buyers market they wouldn't be spending hundreds of millions of dollars buying back shares, but would be hoarding cash instead. Just my $.02.
-Fritz
I agree with your assessment. I did hear the conversation about Argenix and
that is a significant, though subtle topic that adds to the bullish case in the long run.
-Fritz
The convertible is offered to help pay off a prior obligation presumably at a more favorable rate; otherwise it wouldn't make any sense (at least to me) to offer a convertible debenture while at the same time engaging in share buybacks. Of course, the headline in the news services doesn't reference that and so it scares people off. And you are right about the greater market conditions. The biotech selloff yesterday was fierce for reasons I don't understand.
-Fritz
Earnings of $1.50 per year with more coming in the future, equates to a $75 price tag per share in my estimation. I was assuming we would get to that by the end of summer, but now I think that 75 bucks will not be reached until the end of the year or early 2022. This is assuming the status quo with no additional deals of course.
The issue about the mid single digits royalties was brought up in a comment at the end of the article that you referenced in seeking alpha. It was just a comment by a reader. Nothing like that was mentioned during the call as far as I heard, and I've never heard any complaints by analysts about the 4% royalty rate.
Seems like and accurate general summary, but you are nore attuned to the gritty details than I am. There was a comment that mentioned that 4% royalties (HALO's famous "mid-single digits") are low for the industry. Do you think that that is true? I've often wondered about that.
Did you listen to the call today?
Only $1.50 pps forecast for 2021. That's disappointing.
Good pickup. Should move toward $70 by midsummer, IMHO.
Looks like somebody had a marging call this morning.
Probably some dumb ass in Bitcoin.
New all-time closing ($50.40) and intra-day ($50.53) highs today
New all-time intraday high Wednesday: $50.31
Finally cracked $50 today.
That's hilarious.
They are a little behind my year end target but they'll catch up by then LOL. Link back to my pps thinking:
https://investorshub.advfn.com/boards/read_msg.aspx?message_id=160852528
New all-time closing high Friday $49.50