I don't see much upside for Exel until the numbers come in on the trials. As long as MM is determined to keep 100% ownership of Cabo and wants to continue to finance more and more trials with Exel funds, these shares are going nowhere until the final verdicts are in. The bottom line is MM loves to gamble with other people's money. MM wants it both ways. He wants to conduct as many trials as he likes and he wants to keep 100% ownership of Cabo. Only one way to make that happen - continue to do share offerings to raise more and more cash. Of course, these share offerings will only be successful at the brutal expense of the current shareholders. MM has never shown the least bit concern for the current shareholders. He just goes on and on about the wonderful science and how Cabo is going to rule the oncological world. But what about the shareholders financing this huge gamble? Will they be rewarded if the drug is successful? I guess it depends. If you are the last shareholders to get in on the latest share offering, you might be rewarded very well. However, if you are one of those that got in early or bought shares earlier than the last share offering, you may not be rewarded that well, if at all.
I believe this is the reason the shares just go up and down. All the large investors are scared to death of further dilution. MM has never purchased shares on the open market. He is guaranteed to be rewarded no matter what happens. He gives himself shares at $0 and I don't know of any limit on the shares he can grant himself. So, he really doesn't care how much he has to dilute the shares to raise the cash he wants. It is no skin off his nose. I do not believe he has ever made a statement showing any interest in protecting the value of the shares for the current shareholders. All he talks about is the science. Neither do his actions indicate he has any concern in protecting the value for the current shareholders. This is why investors are very conservative when buying shares of this company. It is impossible to attempt to value the company when you don't know how many share will be outstanding should the drug be successful.
Moreover, the more trials MM conducts, the higher the risk for the shareholders. The idea of bringing in a partner is that the risk is shared with additional trials and the value of the shares is preserved for the current shareholders. If MM refuses to bring in a partner because he wants all the glory to himself if successful, all the risk is born by those purchasing shares (which does not include MM). Yet, all the reward is given only to those who purchased the shares at the last offering made and, of course, those who receive the shares for $0 (which does include MM).
So, for now, Exel is just a trading stock that should be sold anytime the value rises based on some success in the science. At least, that is the way I believe many of the large investors approach this stock.
No surprise here. Any objective person knows this stock is not going anywhere until there is BLOCKBUSTER news. Also, there is no question MM is to blame. As I have said a hundred times, MM has no skin in the game. You can never trust a CEO that has no skin in the game. This rule applies double to MM since he is such an egomaniac. The wildcard here is whether the Board or shareholders are finally going to get sick of MM and throw the bum out so this company can be sold or a partner brought in. It is very easy to spend other people's money and MM has no problem doing that. I wonder how many trials he would undertake if HE was paying for them. I wonder how much risk he would be willing to take if HE had some serious money at stake. All of a sudden, a partnership wouldn't look so bad. Of course HE is willing to play this all or nothing game when it is someone else that will receive nothing if it goes bad. HE will win either way. MM completely lost the trust of all serious investors at the last share offering. MM will NEVER regain that trust. Now, investors are just waiting for the company to be sold or the data to come in. No savvy investor is going to put new money in this company at this point. However, there are probably many that are taking their money out for fear of another share offering in the 3s.
B I N G O!! Very well stated. Someone here "gets it" and it's nice to see. Also of importance is MM got duped by GS...something a seasoned CEO who "knew the business side" of things would never have been lured in to and taken the bait. MM not only took the bait...he swallowed the whole hook...and now there 45% of the float is short and GS continues to bank serious COIN :)
EXEL chart tells it all...DEAD MONEY for the foreseeable future.
Right, most of our fellow longs didn't see it. Even if EXEL reach $20B marketcap, we old shareholders might not make a cent. Last two years, we got one indication approved, moved into 2 Phase III's, and 2 more will soon. The result: we shareholder has been cut in half.
Vote MM out!
One of my primary reasons for planning attendance at this year's annual shareholder's meeting is to explore the shareholder's rights venue with other attendees. If improving shareholder value is obviously not on the CEO's agenda, that is the message I will bring back to this board - in as unbiased a fashion as possible.
M3 was a most likely candidate to bring Cabo this far, and may indeed not be the best candidate to further Cometriq into commercialization - but I'm certain that there are far too many institutionally held shareholder votes to instigate any sort of grass roots revolution with the intent to usurp Dr M.
At minimum, you'd need to outvote FMR, Wellington, & TRowe Price.
I doubt you've that many shares.