For now I am holding. While I think my March calls may not hit (have not given up, but less likely), I see no reason to sell the common now.
Here are my reasons:
1. Sedor is still a guy who fixes up and sells companies.
2. The stock actually held up pretty well when the settlement (in which PTSX has to pay $30MM) was announced. If you think about it, this basically just increases the debt to be paid off by a little under 10%, it does not fundamentally alter the company (and they had reserved $15MM or so already).
3. The settlement removes uncertainty. There is no way PTX could come to terms with any prospective buyer until both parties knew the outcome of this arbitration.
4. You can still make a case that the NPV of future revenues substantially exceeds the enterprise value of PTX (market cap + debt).
5. While the simplest analysis is revenues vs. long term debt, ignoring everything else, PTX does in fact have some NOLs that would be valuable to any potential acquirer (assuming any acquirer would itself be a bio/pharma company, which is I think a safe assumption)
6. Through all of this negotiation with creditors and arbitration settlement activity over the last several months, institutional holdings have increased. This suggests that biger players with better knowledge than mine of PTX's revenues stream and patents and NOLs, and better knowlegdge of how these might be valued by potential acquirers, think that PTX offers upside at this level.
If I could afford to buy all of them, I would not need to buy any of them and I sure wouldn't be spending time on the message boards!
