Wednesday, April 29, 2015 8:18:26 AM
By BNK Invest, April 28, 2015, 11:45:24 AM EDT AAA
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Looking back to 160 days ago, Rockwell Medical, Inc (Symbol: RMTI) priced a 6,500,000 share secondary stock offering at $9.00 per share. Buyers in that offering made a considerable investment into the company, expecting that their investment would go up over the course of time and based on early trading on Tuesday, the stock is now 9.3% above the offering price.
Investors who did not participate in the offering but would be a buyer of RMTI at a cheaper price, might benefit from considering selling puts among the alternative strategies at their disposal. One interesting put contract in particular, is the November put at the $8 strike, which has a bid at the time of this writing of 85 cents. That would result in a cost basis of $7.15 per share before broker commissions in the scenario where the contract is exercised. If the contract is never exercised, the put seller would still keep the premium, which represents a 10.6% return against the $8.00 purchase commitment, or a 18.8% annualized rate of return (at Stock Options Channel we call this the YieldBoost ).
Secondaries can often present buying opportunities for bullish investors interested in purchasing shares, because the sudden extra supply of stock tends to require that the offering be priced at an attractive discount to where the stock had previously been trading before the offering announcement. That can also introduce near-term volatility which improves the premiums a put seller can achieve. Selling a put does not give an investor access to RMTI's upside potential the way owning shares would, because the put seller only ends up owning shares in the scenario where the contract is exercised. The chart below shows the one year performance of RMTI shares, versus its 200 day moving average:
Rockwell Medical, Inc Chart
Looking at the chart above, RMTI's low point in its 52 week range is $8.10 per share, with $12.47 as the 52 week high point - that compares with a last trade of $10.19.
RMTI makes up 1.63% of the SPDR S&P Health Care Equipment ETF (Symbol: XHE)
Read more: http://www.nasdaq.com/article/use-options-for-a-chance-to-buy-rmti-at-a-30-discount-cm470250#ixzz3YhSpHsHY
Recent RMTI News
- Rockwell Medical Continues to Expand its Distribution Capabilities in Western United States • Business Wire • 04/17/2024 10:00:00 AM
- Rockwell Medical to Release First Quarter 2024 Results on Tuesday, May 14, 2024 • Business Wire • 04/16/2024 10:00:00 AM
- Rockwell Medical Expands Global Distribution in the Dominican Republic and Bermuda • Business Wire • 04/04/2024 10:00:00 AM
- Rockwell Medical Named 'Great Place to Work' for Second Year in a Row • Business Wire • 03/25/2024 10:00:00 AM
- Rockwell Medical Achieves Profitability on an Adjusted EBITDA Basis in the Fourth Quarter 2023 and Record Net Sales, Gross Profit and Gross Margin for the Full-Year 2023 • Business Wire • 03/21/2024 10:00:00 AM
- Form SC 13G/A - Statement of acquisition of beneficial ownership by individuals: [Amend] • Edgar (US Regulatory) • 02/14/2024 07:31:02 PM
- Rockwell Medical to Release Fourth Quarter and Full-Year 2023 Results on Thursday, March 21, 2024 • Business Wire • 02/08/2024 11:00:00 AM
- Form 4/A - Statement of changes in beneficial ownership of securities: [Amend] • Edgar (US Regulatory) • 02/06/2024 11:56:14 PM
- Form 8-K - Current report • Edgar (US Regulatory) • 01/08/2024 12:36:07 PM
- Rockwell Medical Amends Loan and Security Agreement with Innovatus Life Sciences Lending Fund • Business Wire • 01/08/2024 12:30:00 PM
- Form 10-Q - Quarterly report [Sections 13 or 15(d)] • Edgar (US Regulatory) • 11/14/2023 11:52:15 AM
- Form 8-K - Current report • Edgar (US Regulatory) • 11/14/2023 11:15:54 AM
- Rockwell Medical Announces Third Quarter 2023 Results • Business Wire • 11/14/2023 11:00:00 AM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 10/18/2023 10:18:27 AM
- Form 4 - Statement of changes in beneficial ownership of securities • Edgar (US Regulatory) • 10/18/2023 10:17:25 AM
- Form 3 - Initial statement of beneficial ownership of securities • Edgar (US Regulatory) • 10/18/2023 10:16:39 AM
- Form 3 - Initial statement of beneficial ownership of securities • Edgar (US Regulatory) • 10/18/2023 10:16:02 AM
- Rockwell Medical Names Jesse Neri as Senior Vice President, Finance • Business Wire • 10/18/2023 10:00:00 AM
- Form 8-K - Current report • Edgar (US Regulatory) • 10/17/2023 10:15:59 AM
- Rockwell Medical Appoints Joan Lau, Ph.D. to the Company's Board of Directors • Business Wire • 10/17/2023 10:00:00 AM
- Rockwell Medical to Release Third Quarter 2023 Results on Tuesday, November 14, 2023 • Business Wire • 10/16/2023 10:00:00 AM
- Rockwell Medical Enters into 3-Year Product Purchase Agreement with Centers for Dialysis Care • Business Wire • 10/03/2023 10:00:00 AM
- Rockwell Medical Enters into 3-Year Product Purchase Agreement with Sanderling Renal Services; Expands Distribution Capabilities Westward into Utah • Business Wire • 09/28/2023 10:00:00 AM
- Rockwell Medical Enters into Products Purchase Agreement with its Largest Customer, Enhancing Relationship through 2024 • Business Wire • 09/21/2023 10:30:00 AM
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