Personally I get very very leery of such share count 'manipulation', specially from a company with a history of paying for bills/debt with shares versus capital it already has. I remember in 2009-2010, there were shares being added and SIAF kept reassuring us that the shares would be 'cancelled' and the dilution was not real (They were doing a big swap from restricted shares, etc)... Back then we had sub 55M shares outstanding. A year later, we have quite a bit more than 55M. Shrug.
This idea that the stock price is down because of someone selling who got shares (for debt) at $1.5 seems weird to me. If a company owes me X dollars via debt, I accept shares at a price of $1.5 -- Do you think I will be selling those shares for below $0.75 and take a 50%+ loss on the debt? Specially while the company has tons of positive equity? Insanity -- Debt ranks HIGHER in the capital structure than common equity, why would they take a loss before shareholders take a loss?
This makes me believe the following:
1) Either the person selling is NOT the person who converted the debt into shares at $1.5...
2) If the person selling is the person who got the $1.5 shares-from-debt-conversion, then I'd start looking for shenanigans. I'd be worried about the company constantly 'feeding its pipeline of shares to sell' by giving away shares for 'debt' to someone who then unloads it on the market. If this is what happens, it would explain why the person who converted from debt-to-shares even ACCEPTED that $1.5 conversion price.
Ok, enough ranting from my side. I'm annoyed that I can't get myself to buy this company at this price given whats happened, even though their Q3 was good. Bleh.
-Fernando
