As the market recovers big investors are looking to more liquid stocks to ride the wave up but they need the funds so they have to liquidate not so liquid stocks like LTUS.
Kind of funny because when DOW and NAS are up big it could hurt LTUS. I also own CPHI.ob and the same thing is going on there. At these price levels LTUS has a PE of 3 1/2 and CPHI.ob has a PE of 6 1/2.
One thing the company can do is do a buy back which will really help the stock price. I estimate the company has between $13 to $14 Million in Cash right now but the Float Market Cap is only about $11 million.
Even just an announcement of a buy back will drive up the stock price to a more reasonable price level.
I concur with your thought that they should do a buy-back. However, the recent $5 million Reg-D offering restricts their right to issue new shares without the investors’ approval. The fact that they felt they needed the $4.4 million so bad that they would issue warrants with the offering and guarantee repayment with the founder’s shares indicates to me that they need more money not less.
Getting drugs to market costs and arm and a leg, so this isn’t entirely unreasonable. Another reason for the cash crunch is the AR. But I think they overpaid and are not swimming in cash.
The problem is no one follows the stock so we have no support. I think we will not have any until earnings are released. They did that last year in April so we have another 3 or 4 weeks of this. The thing that really makes me mad is how fast it has dropped on this low volume. I wonder how many shares have been unloaded? We need an institution to get involved and I don't think that happens until after earnings. This is a $2 stock IMO unless they are not putting everything out there. I will hold the shares I have because its so low now I would buy into it if I did not have so much into it.
I actually emailed the company yesterday asking if they were considering a stock buyback plan. I said considering the recent sharp delcine in share price that their own stock might be the best investment they could make right now with some of the cash they raised in the recent private plaement.
Maybe some of their financiers will urge them to do the same. It's a possibility...and would definately speak volumes about their confidence in their business going forward.