I posted some time ago on this forum that I thought uWink was a bad investment in the short term. That was around the beginning of August I think, just after the R/S. I looked at it and said... they are currently losing .20/share. Those are the hard facts. While there is great future promise, my experience has shown that the market tends to wait until the very last minute to recognize it. Even at that... this thing is a bit risky. From reading this and limited research, they need this money from this offering to open the new company=-owned restaurants. So if it does not happen, they are screwed. Even so, they still have along way to go to become profitable. And stocks tend to go down until the company is profitable. It is no sure thing these restaurants will open. likely, but all they have is Letters of Intent. If financing falls through... that is it.
And also, I read what there is about this offering through Merriman. It is on a "best efforts" basis. That is horrible. That means when they set the price, they will sell what they can. It is not guaranteed,
In order to make it profitable, they are going to have to offer the shares at a premium to the market. The buys will then sell some for a profit immediately. Thus the offering price will form an immediate "floor" for the stock, and the price will fall to that level. Right now I would guess in the low 3.00 range, like 3.20 or 3.30.
Another thing that is kind of scary is that one of the conditions for listing on AMEX is a price of at least 3.00. They have fallen alot since the R/S. I would say right now that the price of the stock is a threat, and this offering will make that worse. If I were the underwriter, I would not even know what price to set.
I got out at 4.70. The stock did not meet my criteria. I was right then, I think I am right now... best to wait until after this financing is done before you buy.... thankfully, I have already done well with this stock.
In Canada the low point of the season for stocks is October..t hat is the mutual fund year-end (tax-loss selling). how does it work in the US, what is the seasonal low? I am guessing mid-December for this one.....
