Someone please explain why anyone would exercise rights offering when the stock trades under $5. I can just outright buy the shares now for less. I'm having a hard time understanding this, especially it it does hit $3-4.
first, it's not going to $3 or $4. ross and company could not possibly start buying such a huge # of shares and the price staying below $5. this is a deal for the big guys to buy up enough of the company to take it private and make a killing.
If they can make a killing by taking it private then doesn't logic dictate that XCO is being priced right now at a much lower theoretical value? I mean if there is potential to buy at say $5 and make tons off this purchase one is concluding that this company is worth much more than it's current price? If true, WHY is it so low right now? S-term traders playing the not-so-good-news as of late? And why is the short interest so high?