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Totally agree. I meant much higher and not only higher but sustaining a higher PPS. I wasn't very clear but basically was saying only an announcement that commits $$ or funding will sustain PPS at a higher level. Anything else just makes it pop and then they get to dilute at a higher share price bringing it back down again.
Thanks Scott. I thought about that. Could be a slow bleed of funds rather than paper losses. It's a unique situation because I'd normally just get out. I truly feel like they are close but not close enough to tie up several thousand dollars waiting for disappointing milestones that don't happen. Let's hope for a January development that at least allows us to recover cost of options.
We'll see. If the stock actually goes up and stays up then I'd actually make more from a % standpoint. If not, my loss is less than $1000. Seems like a reasonable trade off considering the instability of the stock, milestones, and deals closing.
Just thought I'd share a strategy if anyone is looking to free up cash for other opportunities. It's been a really bumpy year with this stock. Such a difficult decision but I sold everything. I couldn't get past the CEO bonuses this year, the complete removal of 2H milestones and the obvious pump of the stock just prior to the Fall dilution round. The integrity of the management team is poor at best and I've tried to be open minded that they are in unchartered territory. Even more reason to be transparent and talk to shareholders.
Anyway, I bought march and June call options that allowed me to free up capital but still stay in the game in the event that they hit a grand slam in early 2018. This will allow me to either exercise the option and buy PSTI a little higher(stock price would have to soar ) or trade the option for a profit. More likely.
We are all very news driven. One or two pieces of the right news will send this to the moon. However, Blue and Eich have it right that only news with $$ into the company will allow for this stock to soar. I know I held on for so long waiting to get that piece of news , but news without $$ will result in dilution so the price will not stay high long. Sounds elementary and master of the obvious but I would be skeptical of any news without a very fast revenue impact. Otherwise dilution comes in 1-2Q.
I hope I'm wrong but I just don't see needed money pouring in imminently. Going with options lets your stay in the game with a fraction of the cost.
Good luck to all of you.
I'd have to go dig but the 123 person statement was made in seeking alpha interviews and statements by management. Also, there were discussions about how stem cell trials wouldn't require huge test populations and that they would be faster. Now, don't know what to believe because the milestones have been wiped out that were being reported all year until October, everything disappeared from the guidance. It was changed to "within the next 12 months" when before milestones were more specific to 2H17 and 1H18. If I recall correctly, their claim was that there could be enough data from the 123 people by end of year.
I think you are spot on. I tend to lean on the side of EichKing but I had your same thought the other day. I think they had a fire sale for close in country connections. Wouldn't be very good again to go dilute, RS and have it tank another 30+%.
Too bad we think good things are to come for all the wrong reasons. Normally it would be transparency, a deal, or any other announcement like normal stocks.
Right. The same regurgitated old news junk that a certain poster continues to recycle on here since last week.
I definitely am more aligned with your opinion than the majority here. All good points and spot on with regards to
Phase III risks and dilution. The product is intriguing but management is less than desirable, and now we know that the bonuses they paid in May/June were at best a case study in what a non profitable company shouldn't do with limited resources and shareholders holding the bag.
There are days I think about selling everything and investing it all in PLX. Not here to promote another stock but check it out. They just got $50M injection of cash with a nice licensing agreement by teaming up with a larger company. They are set for 3-4 years while they advance 3 products through phase 2/3 trials. This is where this company should be! X 10!
So,here's why I've stayed so far although I did trim my position conveniently right before they diluted.
1) there are too many irons in the fire to ignore. Govt, grants, fast track programs.
2) if they were in severe dire straights I think they would choose a buy out or partnership before just nose diving.
3) I do think the PPS is being kept down by some scheme or entity. There are biotech companies with much less gong on that ride to $20 on hype alone.
4) even though their bonuses were total bs they have a lot of shares. They wouldn't let PPS go to nil if no other reason than personal impact.
I think nothing happens this year. There will be activity in 1Qbut I think the govt doesn't bite until they are at least on their way in pivotal trials before stockpiling.
Pretty terrible for sure. Interesting that it's down on 77k volume. That is a lot for premarket.
Feels like it's going to be a rough year end close and maybe 1Q.
At best,it's borderline scandalous. If they have enough money to last until 3Q 2019 then why raise $11M in country, crush PPS, and remove all milestones? $11M wouldn't be needed to get them to 3Q 2019. It's a drop in the bucket. Why go raise money other than to take care of your buddies in Israel?
Plenty of speculators without me joining in, but it feels like something or somethings are not going according to plan. ARS on hold until they get manufacturing infrastructure or no commitment until further along in pivotal trials next year.
The news engine is out of gas and they knew it. That's why the raised while we had some good momentum for a change. I had posted awhile ago with a hint of optimism that maybe they were under a confidentiality agreement due to sensitive govt dealings. That would apply to ARS, not every milestone for the rest of 2017.
Totally agree. I had stated in an earlier post that I wouldn't expect anything for rest of 2017. If there were something else they would have held off on a raise a few more weeks to sell fewer shares at a much higher share price. Notice going into the raise that we were seeing news 1-2 times a week. Every scrap of news was used to get it up over the $2 mark. My guess also is that the expectation was for a higher PPS than $2 also.
Been reading a lot of the comments after the fallout of the dilution. IMO, this is one of 2 thing:
1) the money raised has a use for a deal, JV, or manufacturing infrastructure OR
2) it's going to be a long cold winter.
I'm leaning towards #2. Guys and gal, they pulled out all the stops in the last month wrt news releases to get the PPS up!! They scrapped for every piece of news leading into a known dilution. The last news items was phase 1 trial in Israel, which is not very news worthy normally, but it added to the momentum. We peaked at about $2.08 per share but I think they expected/hoped for much higher. Unless the money is committed to seal something , we are done with news. Otherwise, why not wait for the stock price to be through the roof before raising money? Higher stock price = fewer shares diluted to meet end goal. If they had any major news then we'd see it before raising $11M. Also the reason we've seen the 2H17 targets vanish. I vote for a long cold winter and we hopefullly claw back to $2.
Not logical in my mind. Why bring additional scrutiny to management and PPS over $9M shares? Why not just leave the ATM strategy in place to hit the $80M? And doing it with increasing volume so that PPS wouldn't be impacted? This will cause a 10-15% dip due to dilution and an additional 5%-10% due to investor panic over selling. Irrational if there is not a higher strategy.
Thanks to everyone for bringing clarity to the announcement and event. The puzzling thing to me is this. Why freeze trading on the TASE over 9M shares?
I would agree unless miraculously they get bids ATM or higher.
This is definitely troubling news due to the usual lack of transparency, but my gut says the reason behind it may be beneficial. I've never been as negative as Blue but definitely more in agreement with him when it comes to questioning management.
Here are the burning questions:
1) If I recall correctly, the big trials coming up around the corner are funded for CLI and ARS by NIH.
2) The gap was with the DOD waiting on a decision to fund $30M for that pivotal trial next year. Maybe they won't fund it?
3) Partnership? Doesn't this usually involve an injection of cash from the bigger company? Hard to believe they'd need money to go partner with Big pharma. However they may need cash if they are actually forming some kind of JV with an Asian company. Maybe that is finally happening?
4) I find it strange to fund within Israel only. Maybe this is tied to something specific within country, such expanded manufacturing infrastructure? Or speculation on the Lonza involvement?
5) More questions than answers but the reason I think it's something big is because the ATM should have been enough to float them if they had just mismanaged everything, lost deals, and just needed money to buy time into next year.
6) Maybe ARS contract is stalled or maybe its signed but doesn't call for immediate cash like they had hoped.
7) Many of you today have stated that they've pulled down all of their milestones for this year. Sounds terrible at face value, but could be in line with going undercover if there were a big partnership, JV, or maybe some kind of govt. request for confidentiality.
I typed this off the top of my head so forgive any discrepancies in facts. I'm open to opinions or corrections if I've misunderstood or not recollected something.
At the end of the day, it comes down to what I've always said, management would get a lot more support if they just told us what was happening.
While everyone is making predictions,I'll add mine. 1-2 market moving announcements bring this to $7 by year end. If not, then they meet none of their 2H commitments and we may see recession back to $1.50. I think we see data from Japan and govt contract.
I read this board regularly. I was lucky enough to get in years ago then get out. Then this year I got back in when I saw signs of life.
IMO, you are all right. The cheerleaders have good points and good reasons to be excited and the critics do as well.
For the critics, I think that it is really hard to judge the leadership as a failure. The stem cell market is unchartered territory and there have surely been mistakes along the way. However, they are pioneers and there isn't any textbook on how to stand up a game changing company in unknown territory. In brief summary, the valid criticisms that I find undisputed come down to 2 things. CEO bonuses-totally agreed. And lack of transparency around failures and schedule misses. Failures are acceptable but non disclosure direct distrust and justified criticism.
For the cheerleaders. Great technology, product, and I agree on the doorstep of advancement. Don't be so celebratory and naive around management though. Zami was an excellent visionary and strategist to go after the 3D technology and placental source, but the naysayers do have some good points about bringing in industry experience and more business horse power. Management does matter! Look at GE. Trainwrecks everwhere with cost and cash flow front and center.
Finally. I outlined a strategy early on here on this board that drew lots of criticism from the cheerleaders. Panic selling and bailing is always stupid but I decided to sell half to mitigate risks around the uncertainty in
Management and kept half because of my faith in the product. Admittedly, I added back 1/3 to my position back around $1.40 and I'm good to go now. The milestones are in sight but I left off a couple thousands shares in case of a setback. If management would just tell us what's happening, I'd go all in on the good, bad and ugly.
Good luck to all of you and I do hope for imminent management and product
Sucess.
May not be able to prove the ATM selling, but somebody is selling something. Completely illogical otherwise to have this news, 600k volume in the first 30 mins and no price movement.
Totally agreed. I'm a fan of the technology and the stock overall but you'd be a fool to overlook and deny the gaps and holes in the story being told.
And yes Allo, all the government agencies are in sync but that doesn't cease the need for cash first and profits second, as Blue pointed out. I believe that management's stubbornness ties to their defiance with regards to big pharma partners. It's understandable after the UT debacle, but they aren't making good decisions with shareholder interests in mind.
Totally agreed. Lots of irons in the fire but the bonus justification was ridiculous. Based on non dilutive funding? Seriously?
And I agree. Lots of warning in the 10Q indicative of dilution.
I didn't see a lot of reassuring language. They have a good product,questionable management, and are a couple years away. Even with a deal soon, cash is king.
Good post and I agree with your perspective. I also agree with Blue though on the timing piece.
I hope you are right and it flies! We all make out either way. I'm just being more conservative.
I posted on here a couple weeks ago. I firmly believe in the strategy that I outlined then. Sell half now. Mitigate risk. If a miracle happens, take the gain on what you have left and ride it home. However, if nothing happens then sell all at year end. Wait for dilution and buy back everything at a much lower price. Buys another year and I do believe there will be a major breakthrough in the next 2-3 years.
Hi Melon. My thoughts are as follows.
Like a lot of people on this board, I believe in the technology but have my doubts about managements handling of compensation and share holder interests.
I sold half of my shares yesterday and here's why. I think dilution is inevitable but also wanted to be in the game of there is any major development in 4Q. I'm good with it if I'm wrong and the stock goes through the roof. If nothing happens with PPS by year end then I'll sell everything , wait for another dilution, and buy back at significant discount. I believe that a BARDA contract will not prevent dilution unless it has a provision for an immediate cash installament.
I look at other companies that are in play with the US govt. CBLI to be specific. They were well into pivotal trials before BARDA threw them a bone. Why would PSTI be any different? In fact, it's still not even confirmed that BARDA will pick up the $30M price tag at year end for the next phase of trials next year.
I agree. With everything escalating, if I were the government, I'd go with the more advanced pipeline. Not to mention that the government already spent over $60M to fund their pivotal trial. PSTI is still trying to get them to pay for their pivotal trial. Maybe I'm missing something too, but not sure why they'd want two companies with the same solution unless one is more cost effective or if the efficacy is better somehow.
That's a good find. So the reality check here is that CBLI is ahead. Their results are significant and the data is thorough. If they don't have a contract yet and no FDA approval, why would PSTI have one without even going through a pivotal trial yet? I get the difference in mechanisms, but would the govt care how someone recovered if both methods are statistically significant? Maybe cost but I don't see how CBLI is an inferior treatment.
Pretty sure that $8M was on theirs books for all of this year. It was an announced in 4Q last year. If it was a new $8M then you know they'd take the PR credit with a news breaking announcement over the global news wire.
Nothing I read stated the amount of the grant. It was vague. In the past they had received grants between 3-8Mil so I didn't realize it was pennies in the grand scheme.
Wow. I didn't realize there was another company that was closer than PSTI on ARS reversal. Not sure I understand why the government would need multiple treatments that do the same thing unless one treatment has a efficacy or cost advantage over another. The Nuepogen argument for PSTI makes sense but CBLI treatment sounds like it's highly effective.
Good theory. It's definitely mixed news. It feels to me though like they should have another 3-4 months with no alternative influx of cash before they dilute,unless their burn rate has increased a lot over the last quarter.
I agree with Midas. This is good because they'll get some kind of financial relief but I think the market is reacting poorly because most see this as an indication that they aren't far along in China. On the bright side, Any grant helps and maybe buys more time so they don't have to dilute later.
Yay! Our first day in several days, maybe weeks that we didn't bleed pennies off the share price! Hopefully we've hit true support and it's upside from here.
Thought about those options! Tempting but need to see one milestone hit before diving in!
Totally get it. Not a bad strategy. They have so many irons in the fire that it feels like something is bound to happen. My biggest concern is that they rarely meet their time commitments and as you know, options are all about timing. I may consider though seeking a little and putting that amount against some call options. Would be really nice if something past March 2018 would materialize in the option chain.
I love options........ under the right circumstances. PSTI is dangerous because we all know they need cash from somewhere by end of year. If they can't get a cash influx then that means dilution. It would crush the stock price and render your $2000 of options worthless. It's a gamble. I'd prefer buying options once the dilution risk is lowered or better yet sell covered calls against my holding once this gets some interest.
Be careful!
What other ponds are you guys fishing in? PSTI feels the most advanced to me but I think this entire sector is hugely undervalued. Athx looks potentially good. Cytx just got smoked on failing phase 3 schleroderma trial but now looks crazy cheap at .39.
Am I overlooking any others? Mesoblast probably looks 2nd best on technology, but price isn't worth the risk.
I get the concept of a controller for the purpose of Big Pharma trying to undermine the company somehow, or possibly a shady insider trading scenario, but your suggestion is flawed. These levels currently suck so why not buy 10-20% of the company now? Why wait if such a huge surge is imminent? A large investor could load up, drive the price high and then the bandwagon follows driving it even higher.
Thesaud: it's perplexing. I'm either missing some huge flaw in this stock or maybe all this madness about controllers may have validity. Most biotech companies soar on even the slightest hint of news on trial progress.
I don't understand fully the theory on controllership either though. I get that big Pharma would want to prevent blockbuster breakthroughs from a micro company like PSTI, but how does pissing off investors prevent them from reaching milestones. If this ship has already sailed for PSTI and approvals/contracts are truly imminent, not sure what good suppressing share price will do other than create a slow bleed of resources on their end.
You got that right. I've never seen such flopping back and forth. It's barely the beginning of the 2nd half. It's not like we are in December and nothing happened. Give them a chance to hit the milestones they've stated.
The bottom line is that some on here aren't investors. They latched onto news early in the year and speculated fast price movement based on the craze and patterns of other biotech stocks. It can take years, even once in the early phase III process.
Regarding all the madness around the recent share offerings, seems probable there could be a deal around the corner, but also they may need to dilute end of year. Look at the number of trials they need to manage and get through. Pretty normal although hard on the investor short term.
There will be 1-2 catalysts this year that pop this stock, but the real traction comes in 1-2 years once conditional approvals begin to roll in from EU and Japan,not to mention ARS breakthrough globally.
Patience is a virtue.
I'm sure Allo has more specifics but I seem to remember(and they openly admitted) that they had to make some staff changes to bring on someone more experienced and knowledgeable of the clinical trial process with the FDA. Also, as you know, it can take 8-10 years from pre-clinical to approval. Assuming current milestones for approval on CLI and hip replacement are accurate, I don't think they are that far off the mark.
The burning question I have lately is "why did they abandon the PAH path after United Therapeutics pulled out?" It's still listed on their website as part of their pipeline but it doesn't feel like they are doing anything with it currently.
I've see similar articles like this in the JP before. How does PSTI bring this recognition to a major US newspaper to drive more awareness? That's really one key thing here that is missing.