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Cimatron Ltd. Message Board

  • djhmk2 djhmk2 Mar 21, 2013 1:24 PM Flag

    Can I short 100,000 shares today at bid prices & cover at $5.25 next week ?

    Can the public offering shares @ $ 5.25 be used to cover short interest from today?

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    • No you may not. Unless you have the ability to find a brokerage with a 100k shares for you to borrow. CIMT is not even available to short at my brokerage.

      BUT, let's say you could do that. It brings up the difference between a normal secondary that has warrants involved. There are 2.5 million shares available to buy at $5.25

      Let's say everybody was smart like that and sold short 2.5 million shares (Which are NOT actually available) and then bought those shares back from Roth at $5.25 (Which in reality are being placed with investors as we discuss this.) If that COULD be accomplished, who is to say that the shorts wouldn't over shoot the mark?

      What if 3 million shares get shorted??? That puts 500k of short shares chasing a low float stock...We would end up right back at $13 a share in a week. (In a typical offering where warrants are available...there is a reason to short, since those warrants are placed out in the distance and able to be used at a later date to insure a minimum price you may ALWAYS cover at until the warrant expires.)

      It's a nice thought you have...but like EVERYTHING...if it sounds too good to be true...IT IS.

      Just sit tight...we'll be back to $7 $8 $9 and $10 soon enough.

      Growth exploded last quarter and we have two new product launches going on now.