Saw this in a Seeking Alpha article. Might be a good idea.
Federico Pignatelli, Chairman and CEO of Biolase Inc. (BIOL) called out naked short sellers and short-sellers attempting to manipulate shares of BIOL August 19th, in a candid press release. In short Mr. Pignatelli disclosed that Biolase will continue to issue stock dividends on a periodic basis to reward long-term shareholders and thwart the naked short selling of Biolase stock.
"It is widely known in the stock market that shorting and illegal naked shorting are often used to manipulate stocks and cause unjust enrichment of ruthless speculators. I advise management of all small cap companies that are subject to attacks from naked short sellers to uncover such illegal activities and protect their shareholders by issuing stock dividends on a quarterly, or even monthly, basis. This practice results in an automatic audit of issued and outstanding shares and help to keep away naked short seller
How exactly does this work? Here's how... When a company issues a stock dividend there must be an audit of all issued and outstanding shares to determine who to issue the stock dividend to and how much stock to issue to them. A legal short seller borrows shares and sells those shares onto the open market and until they buy them back (cover) and return them to the lender they are responsible for interest, margin requirements and any dividend payments (be it monetary or shares of stock) owed to the lender. Naked short selling is short selling a stock without first arranging a borrow. If the stock is in short supply, finding shares to borrow can be difficult.
If a company declares a stock dividend both the naked short seller and the short seller are on the hook to deliver those shares
It's been a good Bio year.
Gimmee a huge break. BIOL announced it was in violation of its debt covenants and the stock tanked. The nonsense about "naked short selling" is a joke, becuase the data would show up as failed trades, and failed trades are low on BIOL. The daily data is available from the SEC.
Ask yourself this, morons - if someone sells you stock and can't deliver it to your account, don't you think that's a problem? It's known as a fail-to-deliver and clearing brokers are required to go into the market and buy the shares and deliver them, by law.
For every "Naked Short" there would be a "naked long" - someone who bought stock and it just never shows up in their account.
Look at the track record for companies that lash out at short sellers - about 99% of them are huge turds that ultimately tank huge.
Companies can "burn the shorts" by actually delivering the goods. Gimmicks and distractions are a huge red flag.
Sentiment: Strong Sell
Ah, the MASTER know it all has spoken. Anyone have a question that needs an answer? Well, come on, BOIKSY DOINKSY is ready.
If you have issues with BIOL go to their board and tell them about it. The only break you will receive is in your arms and legs from your boss for under performance, to top it off they neglect to provide you with OVATION, their claim is that it is to expensive.
This is the OSIRIS board and you represent your shorts CARTEL, we as longs share the positives and future of OSIRIS.
I believe you are a paid basher and come here to deliver a negative slant on OSIRIS for your employer, in other words you have no skin in the game.
The whole world is watching OSIRIS and more people want their share of this 21st Century MONSTER stock.
This is why I think the way I do. OSIRIS is heavily naked shorted because it is a bio-tech and most biotechs fail on wall street, OSIRIS is the exception. Great PRODUCT, SEASONED TEAM, MAKING MONEY and they have not even begun to scratch the surface, BALL GAME hasn't even started yet.
NAKED SHORTS are here and want their MONEY back, SHOW ME of any other company on wall street that traded over 9,000,000 in one day and the share price increased over 140% on a silly wound study results.
How high will it trade when a COLLABORATION is announced? How high will it trade when a ONE TIME special dividend is announced soon after the collaboration? How high will it trade when SWISS-MEDIC or another country announces, How high will it trade when SHORTS loose control, How high will it trade when Q over Q increase 100% consistently, How high will it trade when a new product is introduced, How high will it trade when a celebrity from the professional sports world shares his speedy recovery using CARTIFORM and many, many more reason to be LONG.
BIOSURGERY started with one product GRAFIX now we are up to FOUR and soon NEW announcements will be made, thing will begin to progress at a faster clip than in the past.
SPLIT like a S C
Sentiment: Strong Buy
Old, you hit the nail on the HEAD. The information and scenario is 100% correct, imagine this.
Upon OSIRIS finalising a collaboration deal with XYZ and announcing a few days later a one time special dividend consisting of one share for every one share owned as of XCB date. This would take care of many deficiencies, 1. double existing shares from 33 to 66 million, 2. float will double, 3. every legitimate share holder would instantly double their money and shares they own, 4 naked short sellers would be responsible for the one time dividend and all price increase in share price. I will attempt to create example below
Say I own 100 shares at $16 one time special dividend of 100 shares from OSIRIS now I own 200 shares at $16 then I would also benefit of the share price increase created by the shorts and naked shorts.
Peter F. and all OSIRIS shareholders would double the shares they own, the shorts would be responsible and held accountable to pass along all dividends to current shareholders, shorts do NOT own shares they only BORROW them.
If you think 140% increase in one day was powerful, I believe a 1000% would be realistic if this was to happen and I believe it will once the collaboration is complete.
$16 X 33,000,000 = $528,000,000 a lot of cash but what if the deal is for $1,000,000,000 up front money for all worldwide distribution rights for PROCHYMAL including USA. plus 20 % of sales for all and current and future indications. this would leave OSIRIS with over $500,000,000 cash in the BANK cash per share would equal to $500 million / 66 million shares cash / share = $7.57
And this is what makes it so
Osiris Therapeutics Receives Title of European Orphan Drug Designation for Prochymal®
FEBRUARY 19, 2013 - (OSIRIS) - "OSIRIS THERAPEUTICS, INC., THE LEADING STEM CELL COMPANY DEVELOPING AND MARKETING PRODUCTS TO TREAT MEDICAL CONDITIONS IN INFLAMMATORY, CARDIOVASCULAR, ORTHOPEDIC AND WOUND HEALING MARKETS, ANNOUNCED TODAY THAT THE EUROPEAN MEDICINES AGENCY (EMA) HAS DESIGNATED OSIRIS AS THE ORPHAN DRUG TITLE HOLDER FOR PROCHYMAL® (REMESTEMCEL-L)."
Sentiment: Strong Buy
I'm probably uninformed about stock dividends but if they are anything like splits, wouldn't your 100 @ $16 become 200 @ $8?
I'd guess that if they wanted to do this sort of "forced audit" or regularly, they could issue 1 whole share for every 100 or 1000 owned at XCB date...that way they could keep at it and continually rid the stock of parasites.
You have to have a good imagination on how high the share price would increase if all shorts naked and otherwise needed to cover based on the previous post
$16 + 1000% = $160
$16 + 500% = $80
$16 + 2000% = $320
All this with the Biosurgery division AKA Icing on the CAKE.
OZ maybe you could enter some of these # into your spreadsheet and see what #'s it spits out.
Triple digits in a JIFFY
Thank you Dr. MILLS
May the power of stem cells increase your IQ ten fold and life expectancy by 75 years.
The Fountain of youth is at hand.
Sentiment: Strong Buy