More than a year ago, I had a heated argument on the SNDK SI thread, unfortunately, I can no longer retrieve that post. Interestingly, the stock was around $20 or so and I suggested that it will be available under $10 (always being optimistic). Since then what I feared the most, massive stock dilution has occurred. Not only the right offering but the funding of Fab 2 is all occurring at much lower stock prices than expected by everyone. They do not have much cash on hand, and to get fab 2 profitable, they probably will need sales in the $50/100 MM range per year, meaning great additions to working capital (though, some of that will be made available by the Israeli government). The question is how long will it takes them to get to such sales level and will there be demand (in time for them to start generate cash). I don't have the answer, but the price action of the stock tells me the markets have doubt that this gambit will work this time around. Keep in mind that at 50 MM shares ( a number they will soon reach, if not more), they need to have visibility of sales of $150 MM in the next two years or so and that is a major problem.
Zeev
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