The lead manager of the February $9 secondary now has a price target of $8.
Note: Sales outstanding on 2/28/2011 = 35.4M. Shares outstanding 2/29/2012 = 66.6M
That's a dilution of more than 88% (after 2 secondary offerings, stock options and warrants).
This is why the current $5 price is fairly valued (e.g. equal to $9.40 before dilution).
Do the math.
> That's a dilution of more than 88% (after 2 secondary offerings, stock options and warrants).
This is wrong, because your numbers also includes share issuance for acquisitions. You would need to make a business case that demonstrates the acquisitions were overpriced or poor complements or else your analysis is flawed.
Of the 88% dilution, acquisitions were a drop in the bucket. OCZ used only 2M shares to acquire a unprofitable company with miniscule revenues.
From the FY'12 Annual Report (10K) just filed:
On January 9, 2012, OCZ issued 2,088,582 shares of common stock in connection with the acquisition of Sanrad Inc.
Did not ignore.
The Y/Y cash burn, of over $210M, purchased inventory.......right?
However, this inventory turned into sales, but because of crap margins, it did not throw off + cash flow (return of cash) and wound up in money hell.
Heads up.....another secondary (and further dilution) coming soon.