Originally posted by webral
Can you list the cheaper shells in the sector wound down and ready to go at $2m or less market cap?
I doubt the R&D changes will have much of an impact on the claim, it's below the cap, clinical trial related and half of it falls before the changes were made.
Current and future cash near $5m imo which can be borrowed against as many companies do prior to the rebate to avoid dilution if necessary.
Run off costs may be more or less than expected but until guidance is provided it's guesswork. What's the annual spend outside of R&D, about $3m? That would be mostly wages of which some have ceased.
Wages may have ceased but then all the accruals related fall straight to bottom line and you just don't know how generous they will be in payment or the contracts in force. No one likes letting people go just before Dec as no work about till March in so many industries depending on budget cycles.
We don't know how much cash expenditure from last quarter was delayed and placed into this quarter as they knew read was due this quarter and any big negative number would all disappear in the wash ( upon sucess with a supposed partner) and they would be in a better for negotiation if they were not seemingly flat broke.
If infact as demonstrated in all presentations FTT thought they were on a winner and were about to get $ from partnership and wanted to get on with further trails and products we don't know what they committed to in the last couple of months
I was simply pointing out how crazy/ speculative a $10 mill val was until some numbers are locked in and direction given. The poster who posted that valuation has now indicated it was done on a TA basis but not saying what indicators have been used but possibly TA hasn't considered non business continuation and that will wash into the graph at a fast rate daily if uplift in price is not forthcoming.
The comments on Orbis / alan gray being a trader - I'll just shake my head at that as a deeper understanding of funds of early stage needs to be known. I can tell you that regardless of mandate that if the folk at orbis thought there was 1c value they wouldn't have tipped out where they did and would have waited till later in quarter if they thought the % they owned could be offloaded. To assume they don't know approx R&D rebate and costs is amusing. Yep they will offload at a discount suitable to risk vs reward but they aren't stupid as shown by their performance and you have to consider relative to total funds under management and other opportunities they may have in front of them as contrarians
Perhaps they don't follow their strategy?
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In an increasingly competitive market, practicing patience can give you a distinct advantage. By waiting for the right opportunity to buy, and giving an investment time for its value to develop, you may discover enormous potential for an undervalued company.
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We seek out companies that are out of favour and wait for an opportunity to buy at a price well below their value. We study a company’s fundamentals, and then calculate what we believe to be its true value.
As for shell - you'll be best to keep a spreadsheet of all shells and keep it updated like other do ( time consuming) and know a bit of their history and if they are there to be filled or just there to be milked until a opportunity arrives and know who is controlling them. A shell controlled by some will get the life sucked out of it ( lifestyle) before it is rebooted while others will get the fast track. . Demand for shell at this time of year- not a lot and with new rules this year values aren't high but depends who will end up controlling it and what project they have to back into it.
For a few years I have used this as a template to costs and when in a trial they are spent etc- only a indicator but is at least based on real numbers.
https://aspe.hhs.gov/system/files/pdf/77166/rpt_erg.pdf
