Forget the warrants and buy the stock if you want to gamble on this one. The warrants expire in 21 months and between now and then there is no assurance that a partnership deal that mends the balance sheet will get done. There is, however, a very good chance they will have to offer more stock because they only have maybe a year's worth of cash after the recent dilutive offering. Also, there is no assurance that the regulators here and in Europe will be supportive before expiration of the warrants.
It will take much time to satisfy everyone that this technology works and is safe, to complete necessary clinical trials, for it to receive regulatory approvals, and to launch and achieve commercial success. Who knows how much dilution will occur by then? Why gamble on 21 months with the warrants when the stock may see a huge success in 24 or 36 months?
This is a highly speculative investment that may take many years to play out and will require much patience. Just read the frustrated posts here to see how the years of waiting have made even the most informed bullish shareholders angry.
I'm going to hold until they win, are acquired, or go broke.
Warrants are much better if:
1- You think shares will be higher than $5 in the next 21 months.
2- You are thinking about buying options
3- You don't want to risk too much until Chris shows you enough to accept risk/reward. This way you will have control over more shares than the other case (it doesn't seem that way now, but if shares go above $3, then you can see it much better)
For every CYTXW, you have until 09/2014 to convert by paying 2.59 per share to yur broker...
Some say, I can buy the share at the same price now, some say you could buy twice as much warrants (CYTXW) and then convert later (or sell half to pay to convert, etc...) the point is that you need to assume the share prices will be more than $5 per share by September of 2014 (so the conversion makes sense)
It makes sense to compare the implied volatility of the warrants to the historical volatility of the underlying stock. If the implied volatility of the warrants is much higher than the historical volatility, then it makes sense to buy the stock, or sell the warrants, or both.
Posted by kosborn3 on 11/30/09 :
Strike ($US)*: 2.59
Expiration Date: 9/13/14
1st Exercise Date: 9/13/09
Listing Date: 6/22/09
Issue Date: 3/13/09
CUSIP: 23283K 113