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even if the number of 100.000 downloads is accurate, it means very little in terms of revenues for a free-to-download game, and surely doesn't address the ongoing cash burn. Hard to justify a $120 million market cap based on that.
The company hasn't even put out their 10-k, but it is interesting to see how much revenues they generated in Q4 in the gaming division, because then you get a good insight in revenue per active user (they promoted pocket starships already in Q4 heavily; and even saw peak usage in that period)
indeed dd
dog duty
All the ups and downs are meaningless until the 10-k this week comes out. That is the moment where SPYR has to prove that all press releases of big download numbers are true and not part of a pump and dump scheme.
Our works suggests that downloads haven't really improved significantly in the last six months, so with an average ARPU, revenues remain lackluster and cash burn will eat away existing cash balance that will cause liquidity issues
It seems that insiders are distributing shares ahead of the 10-k this month. All the movements up and down are meaningless until the release of the annual report. Then it will be released that all the positive press releases were meaningless attempts to prop up the stock. All data are not pointing to any increase in the usage of pocket starships game, let alone a meaningful increase in gaming revenue. In the meanwhile, the cash burn continues and the company has to become creative to avoid a liquidity crunch this summer. Target remains $0
completely agree; they will use the squeeze of the last few months to sell some shares an raise some capital to draw out the inevitable death of the company.
Nobody so far has come with any factual estimates why this company should be worth a $100m. Short selling penny stocks is not for the faint of hearts, but at our hedge fund we can ride these often times worthless companies until zero.
We are the largest short seller in the company, and we are not covering our position. This is a terminal short. The company will run out of cash in Q2 with the current cash burn and is still on the hook for $5m with a prior lender. The restaurant business is not viable and has no segment value when you allocate some of the overhead costs to the division. The gaming division has no value either. The company pays a lot of stock promoters to highlight the significant growth that pocket starships is experiencing. However, the company fails to mention in any article the actual number of active users or the daily revenue per user it will expect. Based on the number of downloads, and the use on iphones/ipad the game fails to crack the top 600 games in the fantasy area. Based on the revenue-run rate until Q3, the company will burn through $4m annually with the game division without any growth. This company has gone through many iterations, and every time is about to go under, they create a new hail Mary by entering a new business: first the restaurant business, now the gaming division, maybe space exploration next year.
It is a fact that no cash flow aside from the trivial lease sum from the KM contract has come in since the latest 10-q. So even more than last time, it is vital that the company indicates that cash flow generating contracts will be imminent, otherwise the company's stock could crater so far below the strike prices of the warrants/options that it will have a hard time raising new capital.
It will be a wait and see story until the report is released. It will be a victory for the bears once it becomes clear that the company won't have any orders lined up or any cash flow generating new leases. It will use the joule heating partnerships that won't bring in any new cash flow as a smoke screen to keep the charade going.
Let's keep the bullish bantering to a realistic level until the 10-q is released. They can't keep selling hope forever, at a certain point orders need to flow in. A liquidity event this year is almost inevitable.
Actually, it strikes me as an act of desperation. The company knows that it will need additional capital soon, and the stock price on a few occasions has dropped below the strike price of the options and warrants, hampering their ability to raise capital easily. It knows that if it can't produce actual orders soon, investors will revolt.
It shows that the company is getting desperate. It needs the stock price to stay above $0.35 in order to tape into the capital markets, and friday's price action shows you how vulnerable the price is on any given day despite short squeezes along the way.
Capital expenditures in the industry are rapidly shrinking, so don't expect reputable firms to waste capex on an unproven shady company with no commercially viable products.
Hiring this firm shows you that Q4 and Q1 are going to be bad. It think once the price falls below $0.35 on an extended basis and no new order news flowing in, the company is going to collapse.
Time is running out. The burder of proof (which refers to both commercial viability and actual orders and revenue generation) lies with the bulls. So far the bulls have been hinging on ambiguous interpretations of what went down after the lastest 10-Q. The annual report will soon arrive, which will clearly show that no improvement has been made, leading to further erosion of shareholder confidence and to an eventual collapse in the stock price. The company should raise as much cash as it can now to prevent a liquidity crisis laster this year.
Sure, the warrant pool has gotten smaller over the years with a little over 5mln warrants outstanding, but the stock option pool is still decently large with 18.5mln options. However, both the warrants and stock options were very close to be out of the money, which would significantly impair the company's ability at this stage to raise capital.
It was oversold, so these rapid higher volume snapback days have been regularly there the last few months, however the direction remains highly negative. Unless we get a 8-k with either substantial orders or any cash flow producing major events, get ready for much lower prices next year, as dilution and cash crunching will continue.
There is an additional dynamic that nobody ever talks about. There are so many million warrants outstanding that used to have substantial value to its holders last year, but were almost out-of-money today at the low point. To protect any residual value in the fact of absent good fundamental news, it is possible that these warrant holders are exercising their warrants and sell their positions to realize any value, especially since their principal will be in danger when the market realizes that it won't be commercially viable.
In order to raise cash,the company needs investors in warrants or insiders through stock options to convert in shares. Unfortunately, the stock price is crashing through the conversion price, impairing to raise capital. It therefore needs to go out to new investors, which will be a though job, and will only be done at much lower strike prices for the warrants and highly dilutive to existing shareholders.
I am saying that they are not doing that at all. There has been consistent more sellers than buyers throughout the year, not just lately because of tax selling seasonality. Daily volume may be high compared to other penny stocks, but remains extremely low compared to the number of outstanding shares. So who are these sellers throughout the year (short interest is non-existent, so that is not an argument either). It tells me that if fundamentals don't improve radically (which in my opinion they never will), real selling volume could pick up and permanently destroy the stock, as the price falls below the conversion price of warrants and options, the company's best option for cash infusion as it continues to burn through cash.
Actually, the bulk of the decline already preceded tax selling season, so that is not a real explanation for the large decline since 2012. Furthermore, the decline so far has occured on relatively low volumes. If selling would occur in higher volumes, the stock could crater to a few pennies, which is traditional for a lot of pump-and-dump stocks. I wonder why so many investors in STWA keep saying that they are accumulating positions, while total monthly volume value is low and supply exceeds demands.
Sure, an order of $50mln would change the perception of investors with regard to the stock - justified or not. However, valuation requires not a single order but a sustainable level of recurring revenues and resulting cash flows instead of one off orders. I wouldn't want to be caught long. So far, everyone keeps reminding everybody what progress the company has made. Fact remains that nobody pulls the trigger on actual orders and the company continues to burn through cash. All deals so far were mere tryouts with little financial consequence for those companies and all order alliances that STWA has formed in the last 6 months are neither revenue generating nor will have any financial impact any time soon, while the dilution keeps chipping away at the "pot of gold". By the time that investors will see any actual orders coming in that will make the company cash flow positive, this company will have sunk lower than Atlantis.
Nobody of the long term holders have made any money on this stock, and probably losed quite a bit on paper the last 2 years. Fact remains that this company is getting close to brink if nothing material (not referring to meaningless alliance news flashes) happens very shortly. The company witnessed in November after the release of the 10-q how quickly stock prices can reset lower on only a few sellers. If no orders materialize by the next filing, the stock price will reset lower below warrant and option strike prices, causing a cash crunch.
Because they signed a lease before it was known that TC had terminated the lease. I bet they wouldn't be so eager to sign up if they had complete information at the time.
Dilution is a guarantee. For a stock price to trade at a sustainable level much higher than the current share price, an order of $50mln is not enough. They should come in year in, year out to sustain shareholder value. The company is running out of time. Hiding behind meaningless press releases to hide the abscence of revenues will catch up with the company, as investors will realize next year that TC won't order anything, that KM has left the building and that all the other alliances are mere feeble attempts to keep the boat afloat. The stock price needs to stay above the $0.25-$0.40 range to avoid a cash crunch in Q1-Q2, which might help explain the late day attempts to stabilize the price.
Assuming dilution along the way, there is no chance that the stock will ever hit $200. If you just do the math, you realise how silly that would be.
It is interesting to see stock volume picking up in the last few days without any stock price movement. That could hint that the stock price is really being supported by a few parties as to avoid a scenario where the price drops below the conversion price and hence would hemper the company's ability to raise cash. If it was so positive, the stock price would have moved up significanly - warranted or not - on the basis of high volumes.
It remains as unproven today and it was last year. The entire industry is rapidly cutting back on capex, so they are less likely to take on gambles on unproven technologies. Besides, there are so many oil stocks right now - of legitimate firms - that are incredibly undervalued. Why make it so hard on yourself by committing funds to a lottery ticket with a big F on it.
The fact that a company publishes a shareholder update through private emails instead of publishing it publicly on the website shows you the lenghts to which this company tries to control her minions. The entire shareholder update adds nothing of substance to the current discussion, and in my opinion borders in certain aspects on disception. The timing can be explained by the fact that the cash balances have almost run out, and they need a higher share price to raise money through the conversion of stock options and warrants to keep going.
I can't wait either. I am just afraid we may not last the wait.
Guess, I am the only short seller in the stock then. My position went up subsequently though when it rose again. However, given the volumes in the last month, it seems that there is little conviction amongst the bulls, since dollar volume is nonexistent. Hope is not a strategy. You can keep saying that the product is proven and that management has lined up great orders. So far, it remains commercially unproven and every day that passes casts more doubt on that claim, while losing more and more cash.
A slow grind towards zero with potentially a fall of the cliff next year when TC and KM go away is more probable than any bullish scenario.
These are either non-revenue producing agreements or short term trial leases that haven't resulted in any orders or follow up commitments. TC has left the building. It is beyond me how people on this board can still claim the opposite, even though the statements in the 10-Q are crystal clear. Management hasn't even bothered to comment on the situation, not even in general terms that wouldn't "jeopardize" the NDAs that people like to refer to. The company continues to burn through cash on a monthly basis.
I think that the end of the Kinder Morgan lease will be the final nail in the coffin, as no orders are likely to result from that lease, permanently dampening any significant revenue potential. I think that around the end of Q1 will be a pivotal moment for the bulls, as then no sane argument can be made to hold on to your shares. I still believe that this company's stock will be decimated in 2015 under the weight of continued dilution and will go belly up.
Are you confirming with we that you are speaking on behalf of the company?
Sure, whatever you makes your day. I have never heard of anything more comical this this. I would scare longs into selling off the stock, in the hope that I can accumulate shares on the `cheap`.
This is not true. Every investor is allowed to do due diligence. Only when insiders are telling you material nonpublic information with you acting on it, you could be liable. If you call an individual who is speficially stated in a 8-k with contract data and contact data, confirming what has been stated in later filings, is not even nonpublic information.
It seems that bulls are worried about people calling to relationships because this ship can sink very fast when everyone confirms their worst nightmare, the demise of the commercial viability of the AOT.
There will be a return of the AOT, the date hasn't been selected yet.
It is still hooked, true, but not running! The AOT is not covered by a new lease, so it would be insurance suicide for STWA if it wasn't covered by a lease renewal.
yes. Why not. The filings and everything else already confirmed that, but just to point out how senseless it is to remain bullish especially on potential TC orders, I just gave it a try. I don't understand why the bulls haven't called that number. It is the most simple thing to do.
Normally, that is true. But the problem with a pump and dump scheme is that management can perpetuate the scheme by issuing equity at artificial high prices. This fraud has gone on long enough, and it is time that it should come to an end. My short position is slight higher than before after increasing it in the 50s to 130k, but it should hopefully get a lot bigger than than. It is time for the longs and management to prove that this company has any residual value, otherwise this stock will come to a grinding end.
If you call Sherry Richardson of Transcanada (mentioned in the termination 8-k filing), she will confirm that the lease has ended ( Contract No. 11124), so there is no ambiguity with respect to any element of the story. TC is gone. The cash burn continues.
Perhaps 2015 will be the year of Joule heating and 2016 of the tornado wall, but don't forget it pals, 2014 was the year of the AOT and 2011 was the year of the Elektra.
you are so right: http://ir.stwa.com/quarterly-reports
If it only were 35k at this stage, my dear friend. Nothing is so sweet as the innocent fool playing the orchestra on the deck of the Titanic.
The SEC filing says clearly that TC has terminated the lease and will return the AOT upon proper instructions.
Is the AOT still functional? Absolutely not, because it is not covered under any lease. For that to be the case, it would have to sign a provision lease for which TC would have to file a 8-k or mention under the subsequent events in the 10-Q. Neither happened!!!
If you call Sherry Richardson of Transcanada (mentioned in the termination 8-k filing), she will confirm that the lease has ended ( Contract No. 11124), so there is no ambiguity with respect to any element of the story. TC is gone. The cash burn continues.
Officially, TC has walked away from the AOT. The fact that the AOT is still there, doesn't mean it is active. It makes more sense that it isn't, because it is currently not covered by any lease.
It is curious why no big buyers of the stock are stepping in with the stock so much down YTD and commercial viability so nigh.