Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
This particular CFO is being incented to sell shares, but that task is not his sole job responsibility.
Stop acting like you are the only one who knows anything - of course selling shares in dilutive, and hurts the price.
However, without selling shares in the past, and as planned tomorrow, this company would be non-existent. That would hurt the share price MORE than the dilution does. A share price of zero is less than a share price that while quite small, is still greater than zero.
Selling shares is a "lesser of two evils" necessity. If you feel they should stop doing it, then by all means, LOAN them some of your own money.
re: 10Q and CFO ---> I'd love his job, get paid $15k/month to keep track of $851.67 of monthly sales revenue.
Wow, how does he do it?
Always nice to see the phrase: "reduced sales of our synthetic DNA".
I cannot believe they are closing a PP tomorrow which they anticipate will fund them through 2008 - they must have one AMAZING sales pitch to show these investors.
Too bad they don't use that sames sales pitch on CUSTOMERS!!
"Woodrow", your comments to Arnold discussed my post.
I never stated that the new CFO joined CYGX "in the hopes of earning 10 MILLION DOLLARS", or that he was "expecting to earn 10 MILLION DOLLARS".
I stated that IF the stock rose to a certain level, that he would have that much money.
I have no idea what he hopes for, and did not address his 'hopes'. Instead, I multiplied 3,400,000 options by $3/share. I implied that he would love to have that amount of money, and therefore would be motivated to get the stock price to rise.
Arnold, you got it backwards when you wrote:
"How can the CFO selling millions of shares make the price per share go up?"
Here is the desired order of events, as I was describing:
1) the CFO performs his job well, doing many things which help CYGX to eventually succeed, causing the stock to go up.
2) the CFO sells his options at this new high stock price
3) We are all rich
--> Now I realize this probably will never happen (cuz CYGX sucks at the 'succeeding' part), but you know that is what I was referring to. In spite of this, you had to ask the inane question above, implying I had stated that the act of selling shares would directly cause the price to rise.
You know I did not say that.
I think the 3.4m options for the CFO is GREAT.
He REALLY, REALLY wants the stock to go up. $3/share is $10 million to him (minus his $0.27 exercise price, of course).
He is MOTIVATED, and the only way HE gets rich is by making US rich.
Verify what you want, on the website, I'm sure distribution info is there somewhere.
My wife is a published MD, my brother is a published MD, and several of our best friends are MDs.
None of them has ever "bought" the publication of their papers, it is based on MERIT. The reviewing is real, and not all are published by any means.
CYGX management sucks, but I do NOT think the science sucks.
Have you ever read the bios of the people on CYGX's advisory board? These people from many recognizable, respected organizations would not risk their reputations and waste their time being involved with a scientific scam.
Re-read my previous paragraph!
You are clearly ignorant about Medical Journals in general.
The fact that there are advertisers paying $ for adspace, and the fact that there are fees to cover publishing costs does not in any way invalidate the scientific facts in the accepted articles.
The fact that Stein's were part of the editorial review process for OTHER articles does not invalidate any scientific facts either. Did you read the conflict of interest section of their website? There is no way they were part of reviewing their own article.
One of my best friends is an internationally known orthopedic surgeon. He has written books, served as reviewer and editor of several journals, etc. He has never reviewed his OWN work, as you imply happened here.
Your allegations are preposterous, and you are making a fool of yourself.
CYGX clearly has issues, and they may end up costing me lots of money, or making me lots of money, but these articles were published and NOT via some bogus process.
Here is a link to the June paper you claim was never published.
You need to brush up on your Google skills. I used the title without putting it in quotes in Google. This helped since it appears they shortened the title when published, vs. the title as stated by the CYGX PR.
Note, this website is NOT the CYGX website:
http://clincancerres.aacrjournals.org/cgi/content/full/12/16/4940
Here are the first several lines of text:
"Clinical Cancer Research Vol. 12, 4940-4948, August 15, 2006
© 2006 American Association for Cancer Research
Cancer Therapy: Preclinical
Bcl-2 Protein in 518A2 Melanoma Cells In vivo and In vitro
Luba Benimetskaya1, Kanyalakshmi Ayyanar1, Noah Kornblum1, Daniela Castanotto2, John Rossi2, Sijian Wu1, Johnathan Lai1, Bob D. Brown3, Natalia Popova1, Paul Miller4, Harilyn McMicken5, Yin Chen5 and C.A. Stein1
Authors' Affiliations: 1 Albert Einstein-Montefiore Cancer Center, Department of Oncology, Montefiore Medical Center, Bronx, New York; 2 City of Hope National Medical Center, Duarte, California; 3 Genta, Inc., Berkeley Heights, New Jersey; 4 Johns Hopkins School of Public Health, Baltimore, Maryland; and 5 Cytogenix, Inc., Houston, Texas
Requests for reprints: C.A. Stein, Albert Einstein-Montefiore Cancer Center, Department of Oncology, Montefiore Medical Center, 111 E. 210 St., Bronx, NY 10467. Phone: 718-920-8980; Fax: 718-652-4027; E-mail: cstein@montefiore.org."
All, be sure to read the update on the website, it is much more detailed than the one in the PR.
Here it is:
http://www.cytogenix.com/en_us/Investors/p37221191.html
I was the poster alluded to by holycow, who talked to Dr. Berens.
To clarify, here is the relevant excerpt from what I posted on 11/6/2006 - please note he did not explicitly say that "the bulk of the capacity" would be for CYGX needs, but more generally that they were building it to serve their own needs:
"I kept asking about external clients, their demand to buy more synDNA, etc, and at some point he said: "I need to stress, we are building this facility to serve OUR needs, first and foremost. We want to use it to build our OWN products, at very low cost". (products = DNA-based drugs, he later clarified)"
from this post:
http://www.investorshub.com/boards/read_msg.asp?message_id=14570307
L2 volume stuck on 165,660 for last 5-10 minutes, weird (B=0.445, A=0.45)
Houndish, you wrote (quoting CYGX):
"Here's a line from the GSL PR that I believe went unnoticed. "Once fully staffed, this facility will employ approximately 200 scientists, technicians and other professionals."
200 scientists? Holy jeez a little ambitious are we Malcy?"
----
Reading carefully, it says they will have 200 people "once fully staffed". It does not state WHEN that "fully staffed" status might happen. It only states the maximum number of employees the building can support. What they are saying is: "This building will meet our needs for a long time".
BigB, listen the interview. Frank Vazquez clearly states that "within the next 5 years", CYGX will be an "attractive" buyout target. I'm quoting him. I listened 4 days ago, so it is from memory.
He specifically cites two other recent buyouts, one the Sirna buyout by Merck, and one more, and states that CYGX is active in each of the two scientific areas of the two companies just bought out (Gene silencing and something else I don't recall).
Interview link, as emailed to me by CYGX:
<http://www.wallst.net/audio/audio.asp?tickerSearch=C&offset=0" target="_blank">http://www.wallst.net/audio/audio.asp?tickerSearch=C&offset=0>http://www.wallst.net/audio/aud....
If there is a buyout, I hope it is many, many years away. We will get way more money that way.
Arnold, stop implying that you are questioning management.
I questioned management, you typed on your keyboard.
downregul8, you wrote:
"The notion that LW doesn’t like debt should make people wonder why? My reaction is that he is concerned about repayment, which could indicate he is not fully confident in the business plan or their ability to meet it. Sounds like he may have issues with commitment."
Quit over-analyzing what I wrote about my call to CYGX and just call them yourself!
The amount of guessing taking place on this board is amazing, all based on comments I wrote up from an actual CONVERSATION with them. Take the same time you are spending guessing, and just call them!
nearlynapping, my take is that dilution is a necessary evil, that it is preferrable to debt, and that it has produced the $$ that CYGX has needed to keep the doors open for 10 years or however long this has been.
I've owned this stock for at least 5 years, probably 7 or 8, I really don't recall and don't feel like looking it up. Dilution has kept this company alive. I wish they had a millions of $ in customer revenues every month, but until they do, I'd rather they keep selling stock than take some of the "Toxic" financing deals I've seen other OTC/BB stocks take (stocks I owned, and are now worthless).
nearlynapping, precisely my point - if CYGX had taken bank loans earlier, they wouldn't exist now. By avoiding debt, they survived some VERY lean years. Therefore, I support the continued avoidance of debt.
KEY: Dilution is not great, but it sure beats bankruptcy!
There is no WAY cygx can qualify for a bank loan, unless they have an enormous, still-undisclosed stream of revenue piled up sufficient to repay the entire loan plus all their operating expenses during the loan repayment period. The only other source of revenue to repay the loan would be .... dilution. If dilution would be used to repay the loan, it would require MORE dilition, since INTEREST must be paid, in addition to the actual cost of the building.
arnold, instead of asking 'downregul8' about Dr. Berens' answer, why don't you just call him yourself? the number is on:
http://www.cytogenix.com/en_us/Company/Contact.html
and is:
Phone: (713) 789-0070
arnold, who cares about dilution? It has been a part of CYGX since "day 1". The stock is doing fine, even if more shares exist each year than existed the year before.
All that matters is that total demand from the buyers of the stock exceeds the supply of the stock, over the long haul. If this occurs, the price of the stock will rise.
As the science of CYGX is discovered by a larger and larger audience of investors, that will occur.
If you don't think it will, sell.
holycow, I agree, I think they plan to use revenue from customers to pay for some of the building costs - but could not disclose that to me on the phone yesterday.
Holycow, Dr. Berens was quite sure of himself regarding the finance answer - I asked "how do you plan to pay for this building?" and he immediately said: "via the capital markets." He elaborated that this was how CYGX has funded everything to date. I asked "will you need any debt?" and he said: "no, LW (he used the whole name - our CFO) does not like debt, and it is not necessary." When I asked further questions beyond that, he stated it would be best if LW answered - and I stated that I didn't really care, and could move on to my next question.
This is in reply to your post which stated:
"I suspect it might be the case that he does not know the details on this matter."
It is my impression, as the person who spoke to him, that he has a very clear understanding of the details, and that he was involved in the process.
I agree there are LOTS of shares for sale at $0.79.
When I bought my 60,000 shares on 11/6 (monday), I placed a limit order at 0.83 (since my level II showed lots of sellers at 0.83). At the time I placed the order, b/a was 0.76/0.77.
My order filled 47,500 of the 60,000 shares at 0.79 - and my whole order all filled between 0.77 and 0.79.
So, my point is, I placed a limit buy order capped at 0.83, yet the max I paid was 0.79. I expected on a buy order of 60,000 on a 154,000 volume day (at that point) that the ask would immediately shoot up to 0.84 or something like that - but instead the most I had to pay was 0.79 - I was quite surprised, and happy.
bigworld, I agree with you. CYGX has now publically shown, in a new more committed way, the capacity to produce serious revenues, and potentially enormous profit.
They don't always come through with what they say they will do, but in this case, their long term approach really hit home to me.
I was particularly struck when Kurt made the point that they are building this facility for their OWN use, to build their OWN products in. Not just to setup a synDNA "manufacturing line" and hope someone wants to buy some. I was asking several questions about that whole idea of selling it to others, when I guess he just decided I was on the wrong track a bit and corrected me.
They hope to manufacture their own products which happen to use synDNA, and he stated they will be unique in the industry in their ability to do it a such a low, low cost - due to having their own (hopefully patented by then) ability to produce the synDNA raw material, vs. buying it. See my original post for more on the patent issue.
One more thing, they are actually buying the land, someone here had asked about that over the weekend - I asked, the land is being purchased.
They have been selling shares periodically for 10 years now.
The company would not exist if they didn't do this.
I suspect the price I will get someday when I sell (on news of CYGX being acquired) will exceed today's price, with or without issuance of new shares. That is my only benchmark.
It sure beats debt, if you ask me. They have a strong aversion to debt - I specifically asked about debt, and they said they have never needed it, and hope they never need to borrow in the future.
downregul8, another point - they didn't say they were "capacity limited" at the future potential production of 50 grams/day, they said that NOW they are capacity limited.
Regarding today's capacity to produce synDNA, I asked - he said they can produce 1 gram "in a matter of days". At that level of production, right now, they are capacity limited.
I didn't ask about IND progress.
downregul8 - no, GM's revenue is NOT capacity limited - they have the capacity to build WAY more cars than they can sell - that's why they have closed plants, laid off employees, etc, recently.
If GM could double car production, they would NOT report double the normal annual revenues in the next 12 months.
CYGX hinted that they WOULD sell much more, if they could make, right now.
gutaquest, you are welcome. I kept repeating that "capacity limited" remark back to him, as part of follow-up questions, and he never wavered from that statement, or tried to take it back - it is more certain than any other quote from him - was repeated many times between the two of us.
Yes, he also said regarding capital markets - something to the effect that we would fund this in the same way as we have funded everything else the company has done since inception, but hedged on what he said - making it clear he worked on product development, not finance, and that more details would need to come from the CFO - I didn't press for any more, as I've been in this stock 5-7 years (so long I can't remember!) and am aware of how they fund things.
You are welcome, and yes it was awesome - I was entering the buy order while still on the phone...
My call to CYGX:
I just called and talked to Kurt Berens, product development at CYGX. What follows is my summary. Much of it is exact quotes, I took notes. I condensed the notes a bit below - but key words like "capacity-limited" are HIS, and were discussed at length.
That 60,000 share purchase that just occurred between 3:04:30 and 3:06:38 (EST) was all me, between 0.77 and 0.79, more than doubling my stake in CYGX. In short, if all 14 employees are as sharp, articulate, etc, as Kurt, we are in good shape.
Here is my summary:
CYGX phone call, 11/06/06, Kurt Berens, product development
Q: What is source of funds for new building?
A: capital markets - but this would be a better question for our CFO.
Q: Will you use debt in paying for this new building?
A: No, not necessary. If it ever is, one division of our partner, GE, specializes in that kind of lending, and we would have very good terms.
Q: What is your confidence level of your ability to make all payments to build and occupy this new building?
A: Very high. Our ability to produce more revenue is capacity-limited. We could substantially increase revenues with more capacity. In addition, our current capacity is non-GMP compliant. The new building will be certified as GMP compliant, increasing the appeal of the product to clients.
We looked into buying GMP-compliant space instead of building, but chose to build, for several reasons: the new building would be a financial asset on the books, and existing space had "too high of an entry cost".
Q: is the "50g/day" limit for the whole building, or per suite?
A: Whole building - but given more demand from clients, we could improve our capacity to exceed that amount.
I kept asking about external clients, their demand to buy more synDNA, etc, and at some point he said: "I need to stress, we are building this facility to serve OUR needs, first and foremost. We want to use it to build our OWN products, at very low cost". (products = DNA-based drugs, he later clarified)
quotes:
"our ability to produce revenue is capacity-limited"
"We would never enter into an agreement to build a facility if we were not very confident"
"we have a very good relationship with GE, and want that to continue"
"if our patents for the manufacture of synDNA are granted as written, we will be in a VERY enviable position - will be able to manufacture at a very, very low cost compared to our competition" (patents are in 2nd year, typical patents take 36-48 months).
When I thanked him for his time, he said:
"Thank you for your MONEY. Without it, we wouldn't be here. It's your company. I'm a shareholder too, and I appreciate your financial support." (or something like that)
A paperclip weighs about a gram. So yes, it is tiny.
Internal use VS Selling it
Do we have any factual knowledge of customers waiting for our "April" production? Or, is CYGX only planning on using their production for internal vaccine development?
Customers = revenue, internal-use-only = no revenue.
I'm hopeful we have customer's lined up for the products we will be producing starting in April, but I cannot recall any facts from CYGX or elsewhere which proves we have them.
Comments?
specul8, I hope there is no buyout. If cygx is successful in the next several years, the stock price will be far higher a few years from now than any buyout would pay in the next several months.
think long-term...
holycow, perhaps call your old roommate and get more details. You can just say "I saw you mentioned in a PR" and ask for more info on the GE/CYGX relationship.
Good luck, and I envy you.
Hopefully someday you and I can have several CYGX millions each, to avoid having to spend time monitoring/trading stocks each day, and just live off dividend/interest checks which arrive in the mailbox... trading stocks "for fun only" with a small portion. Ahh, would be nice.
Good luck...
You are welcome - I used to own 'nite' the stock, did some reading about it then. I hope my memory is accurate about what they do.
I'd prefer it be a reality not a story but yes, it sure makes a great story.
I sold that Dell the same year I got engaged to my wife, 1994, and in the first several years of our marriage I kept saying: "If I had kept that Dell stock, we would now have $52,000" then a few months later: "...we would now have $88,000" etc, etc.
Finally she said: "Don't EVER tell me again how much we would have had, I don't want to think about it".
Besides, it is only in HINDSIGHT that I can tell $55 was the high, in early 2000. It would have been impossible to know that & sold precisely then, right before the big downturn in the market. Chances are I would have sold way before then, or still be holding it (at about 1/2 the high).
Makes a nice "what if..." story, as you said.
It means nite has a customer (a brokerage - they clear trades for brokerages) which has a customer who wants to sell CYGX, for at least $1.50 (someone entered a sell limit order, specifying a minimum acceptable price of $1.50). OR, nite is lying and wants to make it look like they have such a customer. OR, perhaps nite has no sellers of CYGX on their books, so just put a very high ASK price in the system to signal that.
Paulness, I agree about holding long term.
I bought DELL in 1993, I had little money then so bought 100 shares at $16.25 or so. $1,625 total investment. It was the second stock I ever bought - the first went bankrupt.
I sold for about 60% gain in 6 months, and was very happy with that.
If I held for 7 years until the year 2000, the numerous stock splits would have turned my 100 shares into 6400 shares. At the high of around $55 in early 2000, that would have been $352,000 - or more than 200x my original investment - that's 200 TIMES my money.
If only I had known - would have borrowed like crazy, invested $16k, turned it into $3.5 million, and be typing this from home, not work.
holding my cygx for the long-term...