5 reasons I buy RNVA
1. PPS relative to assets is extremely low
2. PPS relative to projected revenues is extremely low
3. Revenue increase should improves balance sheets. As lenders exercise warrants and conversion at this point in time should result in decreased derivative liability in coming quarters.
4. Dilution impact and conversions, warrants as reflected in current PPS has not yet adjusted to revenue capability in coming months. Therefore PPS undervalued. IMO, solid long term hold, buy on dips.
5. Turn around of RNVA more likely to succeed then not succeed.
3 RISK Factors to consider
1. Possibility that lenders will convert remaining debt and sell those shares to MMs with the objective of first right of refusal for up to 50% follow on (next round financing) for 90 days means that for 3 months following conversion dates MMs could buy highly discounted converted shares from lenders and continue dumping those shares into retail. This gives the false appearance that MMs have unlimited shares and without using some restraint MMs could curtail and negatively impact retail stabilization. The PPS impact is that good news fails to increase PPS which discourages retail buyers.
2. CEO/BOD may decide to make additional acquisitions using SABBY which means more toxic financing. Toxic lending IMO really needs to be addressed by the CEO if he wants shareholders to feel confident in RNVA. At this point this has not been addressed.
3. With so much of the conversion activity by existing lenders the majority of the AS could be consumed by these conversions which leaves fewer options available to the CEO/BOD and could require additional AS increases. This IMO needs to be addressed by the CEO to shareholders and as of yet shareholders have not been informed of how RNVA intends to finance additional acquisitions.
NOTES: Cash flow and current financing IMO are sufficient to cash flow into positive territory within 12 to 18 months, Retail absorption at these prices is probably why MMs are holding the PPS at current levels, PPS is very low when considering asset valuation from a revenue generation ability point of view, over the longer term PPS will adjust accordingly but toxic financing is and continues to remain an issue in the overall performance of this stock. IMO PPS at a bare minimum should adjust back to pre AS increase pricing less any OS increase to the current date. This is more likely to occur on future 10Q/10K since lenders are presently using events to sell converted shares. Check filings to determine convertibility. dates, warrants, etc
OVERALL, IMO THIS REMAINS A SOLID LONG TERM PLAY FOR AN OTCQB STOCK, LOTS OF RISK BUT THAT IS REFLECTED IN CURRENT PPS. AS STABILIZATION OCCURS LOOK FOR SIGNIFICANT PPS INCREASES
