state of the economy & effects on emerging markets (ONVO)
Would love to hear thoughts/opinions on how you guys see the greater role of today's economic realities play out on little groundbreakers like ONVO. Obamacare & the falseness of the market right (propped up by QE infinity) could have some crazy impact on ONVO, companies like it & our portfolios. Watching Cyprus is like watching another domino fall. It seems like its only a matter of time here - we might be last as the machine behind the worlds reserve currency, but even that seems to be changing lately (search China/Australia or Russian/Chinese partnerships to trade directly, and look up the Bahraini Dinar as the medium of exchange for oil rather than USD now). I don't want to sound alarmist or anything, but the world is not in a good place. What do you guys think about macro economic forces and their effects on ONVO? Be specific if you like (Obamacare implications, etc).
Macro conditions drive correlated responses in stocks which are in indexes and/or are widely held. Onvo is not widely held, and is therefore not driven as much by macro conditions but rather on the liquidity needs and sentiment of the current large holders which are NOT mutual funds, hedge funds, pensions and/or the like. Therefore, it responds more to ONVO news and reporting than macro conditions. Of course if the world turns upside down, Onvo is also in that boat as are we all. I do view Onvo as one of the first beneficially disruptive technologies that will drive the 21st century to a better and more prosperous place. That is why I am staying long.
As an aside, I was recently asked to allow our several hundred thousand shares in a non-margin account to be made available for borrowing by short sellers. If I had agreed to this, it would have meant 6 figure income - but I refused on the principal that people and their need for new bioidentical parts and the need for better drug assays was vastly more important than even many dollars. Plus, it's like loaning a gun to a mugger so he can more efficiently rob you.
First, thanks for a thoughtful reply & candor regarding your position - especially given the size of your stake. I tend to agree with most of what you said, though I wonder what effects the medical device tax & other pending policy changes obamacare will have on ONVO. I also wonder how our budget woes might effect things like research grants, which play a part in ONVO's current revenues and will for the next few years at least. Regardless, I too believe in this enough to spend quite a bit of time researching & closely following the company. While my stake is not even close to the size of yours, it is still quite sizable by any measure, and I intend to increase my position until this company uplists at a minimum. They say very few companies ever uplist, even given promises. I think ONVO can do it, though they will likely have to dilute in order to meet that goal (they are ~9.7 mil short in the stockholders equity requirement as reported by Zacks on 19 March). My short term magic 8 ball looks something like this:
1. Good news (maybe to be delivered on the 4th?) forces the price up
2. Dilution follows in order to keep the price above the required minimum - they only need to dilute slightly
3. Uplist to Nasdaq late spring to mid-summer.
Hoping the economy holds up till ONVO makes some money an the stock goes up. Once QEternity stops, the markets WIIL fall. HOPING I'm not in ONVO anymore when it happens. I agree with everything you said., but it could e a couple of years till that happens