Thank you shorts for the extra $4.5 MILLION you have to give to the longs this week.
Since Nov. 2011 your short interest has grown from 6MM shares to over 30 MILLION shares by 9/12. However, there are a few problems that were unforeseen:
1. Fusilev has not only maintained market share but is growing and increasing market share. Z and Fotolyn are now in the house with B and A coming on.
2. Daily trading volume has been cut by 50%.
3. A share buyback was announced cutting the outstanding shares and increasing the EPS.
4. A special dividend was announced which cost you $4.5 MM plus.
5. The buyback will continue and additional special dividends may and likely will be announced at any time.
6. The Q4 2012, Q1 2013 and 2013 Full Year Estimates were all INCREASED in the last 2 weeks. Almost $77 MM in Q4 and over $96 MM in Q1 2013. Both RECORDS for the 9th and 10th Straight Quarters.
should have covered on 11/8/12 at $10.64. You could have gone long or short on that date. Should have gone long. Now, it is just a question of how much more you lose with no volume or float which allows you to even think about covering.
to be frank........... sppi is a growth corp no doubt.........but my understanding is as follows:
1)yes Zevalin is in the house, but not notable revenue. no signs of zevalin growth YET. although lots of clinical studies on Z are accumulating w/r to the upside of greater Zev usage in terms of best help for patients. however,,,, the zev financial revenue qtr over qtr has NOT appeared YET. HOPEFULLY IT WILL.
2) no guarantee Belinostat will get Fda approval for PTCL indication.
3) certainly no guarantee Apaquizone will ever get Fda indication. we have zero idea if fda will go for the combining of the two trials phase 3 apaquizone datas,,, so as to quickly enable sppi to submit a nda to fda on apaquixzone. and the multiple instillation trials on apaquizone take the potential nda application to fda,,, many many many years away from today, for '
4) no evidence whatsoever, that raj will in fact engage in any more share buybacks nor any more one time special dividends. YES, RAJ/SPPI is authorized to do so...........but it is an UNKNOWN DOABLE VARIABLE available to sppi.
5) i am most interested in todays sppi price action as i believe today 4 pm is last opportunity for shorts to cover,,,,,,,,before shorts are bound/liable for paying dividend of .15/sh to the longs. (i believe tomorrow divy goes ex-divy, though i might be off by a day or so ? ) but concept i believe is correct.\
6) i dont see(anytime soon) any material downside catalysts/events that should warrant the existing short interest in sppi mkt cap and depressed/.manipulated pps.
7) i think shortie is stuck in a mistaken bad bet on sppi and/or the sppi institutional longs are making money loaning out shares and reaping the .15/sh divy,,,,,,,,,,,BY virtue of them lending shares out to shortie. some kind of boxed trade ? clear to me is that the institutional longs are in some capacity , in fact, the institutional shorts., in sppi.
8) i think eventually, such institutional trade will be dramatically altered. im thinking they will next profit by taking sppi pps to the upside- revisiting 17/sh and hopefully higher. if so,,, retail longs need ability to hold as long as necessary until this paradigm shift by the institutions does in fact take place. such is unforeseeable. of course a notable positive sppi event would also, force the short interest to take the sppi pps higher as well- some sort of short squeeze.
9) i am not big believer in stereotypical "short squeezes"..........havent seen them occur much and i think the big players have multiple venues to trade shares so as to blunt the occurence of a stereotypical "mother of all short squeezes".......i could be wrong and i hope i am wrong on this.
10) an sppi "wild card" is ken keller. it remains to be seen what he can do for sppi. in due course( i am thinking 2 entire fiscal quarters of ken keller at work for sppi) i would think we s/h should get a decent clue as to wheter ken keller can increase sales growth of sppi products. could potentially be a valuable "wild card" or........ zev can remain in no where ville...........worldwide........... no one has answer to the ken keller question until he is given reasonable time to perform mission he was hired to accomplish. maybe 3 qtrs is more reasonable . im no expert on this.
11)i dont think belinostat fail, if such occurs is a notable downside to sppi future growth prospects and such should not at all be a basis for the existing short interest in sppi,,,,,,,,imo. a belinostat success/fda approval for ptcl indication as well as expanded uses of belinostat is obviously positive for sppi...........but is not going to show on sppi fiscal quarterly reports, for years to come.
12) development in yr 2013 of many many phase 2 clinical trials w/r to sppi's pipeline products are likely to be one of the big sppi stories for year 2013. raj stated, even if one of a dozen turn out to be successful,,,,,,,,,sppi will be a BIG winner financially............(paraphrase by me from recollection).
13) next sppi qtrly report should show that fusilev (sppi's cash cow which pays for all our trials for our dozen pipeline drugs as well as our dividend and share buyback and as well as the lack of further dilution which benefits the s/.h) revenue is still going well and should be in line with the last 3 fiscal quarters........... slowing down the rate of growth/penetration is not anywhere near bad for sppi corp. maintaining where we are now is highly acceptable for sppi. w/r to fusilev. slow growth of fusilev is icing on the cake for sppi cash cow .......... and elimination or substantial eradication of fusilev usage ? i've seen NO EVIDENCE OF SUCH OCCURRING DESPITE SOME POSTERS ASSERTING SUCH.
String, Kapoor, who spoke not so long ago at an investment conference, gave a very decent assessment of what he hoped this biotech might do and accomplish in the next few years. It's mostly all the reasons too that I continue to maintain a position in this equity. If things remained the same in 2012, I might not want to continue to hold this equity, but it appears they made serious manuevers this year to try to take the biotech to a much larger level and commercial phase. One, was the buyout of ALTH, which gave them another marketable drug, another was the entrance of this new former AMGN-led sales force and so what may come about from all their new strategies and tactics, and new contacts and new inroads in growing Zevalin to Raj's high level of expectations. Zevalin allows the biotech to be international in scope. ZEV may prosper in socialist-type healthcare countries. Zev growth may also attract foreign investment. Another is Fuselev, at least, maintaining momentum. and, as seen in Europe now for over a decade, proving the generic is no "threat". Lastly, and ultimately, successful synergy with FOL/FUS/ZEV altogether would be a thing of beauty for the stock price. Favorable data and FDA decision with Belinostat. Advancing the ten drug pipeline through their already later stage trials(Raj once said a goal is to have an NDA filed a year)... ALL play heavily into this biotech's favor and future.....
Hi Joe, You're correct regarding 11/8/2012. And the idiot shorts han a second opportunity on 12/10/2012 as well...The inference is that the institutionals are in absolute control of the short positions, since they have not covered in a logical manner. Frankly, if you control the action, ther is no reason to fear the conditions you have precisely outlined
The shorts just believe that Fusilev sales will diminish and that Eoquin is a failure, plus they think that Belinostat doesn't have a big enough market to be worth the concern given current prices, and Zevalin sales will continue to languish. Shorts have not been proven wrong yet, so they do not cover. They don't consider the current price range fair value, and neither would you if you agreed with their positions on the aforementioned issues. I am long sppi, but there's no reason to get emotional about this until Raj makes the necessary announcements. A dividend is irrelevant here as it is paultry, as is the price fluctuation between 10-12.
Shorts want to see this stock go down to 5, then they will cover, and longs want to see it go up to 20, and then they will take some off the table. One side will win this battle of attrition, the question for all involved is whether it is a Pyrrhic victory. The stock has flattened currently because people have made their bets and now only time will tell who was right. Everyone knows there's going to either be a sell off or a short squeeze in the next 15 trading day with the new data coming out. This is a high risk, high reward game we are all playing.
I love your positive energy - keep the momentum going !
Everything you are saying is correct but the shorts are still working us out - I can't set a finger on management for 2012 but yet we are still down. Its quite frustrating as other investment are going up but I am patient enough to at least get my profit.
The biggest trigger would be if Management can get the sales going for Z and A approved through FDA. As such I would think the shorts would finally give up.