First let’s start with the definition of the word dilution.
Dilution
The change in earnings per share or book value per share that would result if all warrants and stock options were exercised and all convertible securities were converted. Diluted earnings per share are calculated in this way and give a more accurate measure of a company real earning power.
So with that said even with new shares coming into the market which I don’t dispute that they are, the value of VSPC still continues to rise. Which it is and although it has been small upward ticks the trend supports this upward valuation of your shares. Two weeks ago I bought 25,000 shares for .023 and today they are worth .0284. I have bought a total 141,500 shares at different levels and at least 70% of those shares are worth more that when I bought them today at least and I am in the green.
So based on that and even with the new shares on the market the value of my shares has not been diluted as they are worth more than when I bought them.
But if you bought all you shares at .03 or .04 then you could say the value of PPS has been diluted by these new shares. So I think it is a matter of perspective.
There is no doubt that new shares from the reserve are coming onto the market as I pointed this out to you in my last post to you.
But I think you have to take into account that they have not raised the A/S to do this. By Definition all shares are included in the definition of dilution including those shares all the way up to the A/S or to include the reserved shares. If they were to raise the A/S and introduce those new share to the market then I would consider that to be dilution that you would need to worry about. But they are not doing that and as I pointed out in my post they have enough reserve that IMO will not need to.
If Dilution as you describe it, is used as capitol to increase the overall value of your PPS then by definition it is not dilution because they have increased the earnings power of each shares by growing the company. They can’t grow the company without putting these new or reserved shares on the market. By definition reserved share are not new as they are part of the A/S and I shouldn’t use that word. I only use it in the sense that when reserved shares are put on the market they are new to the market and active trading. If VSPC is then using your capitol to increase the value of your investment then they are increasing the earning power of your shares.
Do not forget that as time goes on and VSPC succeeds that this is the type of management that will buy back these shares at some point to increase the value of your PPS and they are the type that once they have real money in the bank that is sufficient enough to supply their capital needs the will likely retire shares that they buy back.
Also I think you have to take in to the equation that this stock is undervalued at this time and I think is because the A/S has already been factored into the price by people who assumed one year ago that the remaining reserve from the A/S was going to be diluted just to keep the company going and not create or be used for growth. This has now changed in the last 6 months and it is just now starting to be made known to the investing community by this promotion campaign.
Now we are seeing this dilution being used in a way that will actually create value for the company and shareholders and will once the MM's are done consolidating increase the value of our PPS even more. And then once contracts are signed and revenue coming in dilution won’t even be a worry.
Again if it does this then by definition these new shares will not be considered dilutions.
This is just my opinion and you don't have to agree, but please do give it some thought.
If you disagree, please explain why more clearly as I would love to know as I could be wrong.
I think if the PPS in back down to .023 next week then I will be wrong. If the PPS is at .032 and getting higher then I might consider me right.
Regardless, this is a necessary evil at this point in time for VSPC, but IMO opinion it is being done to increase the value of your investment not dilute it.
Thoughts anyone.
