The fact that the debt was coming due this year does not mean that they would have had to use their current cash to pay it anyway.
If they have found a shortfall in LTC reserves their current funds would have had to be applied to the shortfall and they would then have to just refi the 2016 debt when it was due. Probably refinance it in the high end corporate market.
If their funds on hand were in any way encumbered by the need for more capital to be applied to the LTC biz I don't see how they would use it for early debt repayment. I don't even think that such a thing would fly with their regulators. It would be like they tell the regulators " screw the LTC capital requirements and policyholders, we are using the capital for early debt repayment". Don't see how they could do that. I think they basically have to put the LTC biz and it's policyholders first if there is a need for more capital at LTC and then refinance the 2016 maturity later. Because they have in fact repaid the 2016 debt early, I then do not see them having found any need for an increase in LTC reserves.
I don't personally find it difficult to watch at all. Actually glad to see the decline because it allowed me to buy some more shares at $3.26 on Thursday. Never thought I could buy any that low. Took a pure slaughter in the markets to get it there but it was good for me personally. I guess what price you bought in at has a lot to due with whether you find the decline painful or not.
By the way, the light at the end of the tunnel is only a month away withe the earnings report.
They had previously announced they were going to do a review of the LTC biz and its reserve levels during the fourth quarter and report the results with the earnings report.
You will note that they recently repaid all on their debt due in 2016 early. That basically tells you that the LTC reserves are fine. Silly fantasies about the company needing to take a huge charge to add to LTC reserves are the only reason why the stock is trading at absurd levels, and yet the debt repayment tells us that the LTC book is actually healthy.
The light at the end of the tunnel is the report of the LTC review in about a month that will reveal that LTC is in fact healthy.
I added some here as well. Only added 850 @$3.26 but too cheap to pass up. Got a fair number of shares now and all my present share are at $3.85 and less.
Glad to see others adding while the price is still under $4. Don't think it will be there for long.
I kind of regard the ability to buy shares at these prices as a kind of Christmas present.
I don't think there are going to be any more charges to reserves for LTC. I see $8 to $10 before 2016 ends and then maybe $20 sometime in 2017. (so adding in the $3's is a very good idea if I'm right about no more charges to LTC reserves)
There were only 7,320,000 of the series A warrants to start with and 4,832,000 were exercised between Nov 30 and Dec 9. Dec 9 was Wednesday, so throw in some more warrants for yesterday and today and there just aren't that many left.
Bear in mind that not every single warrant holder will want to exercise every single warrant they hold at just this particular time. One or two million of the warrants simply won't be exercised just now. Add that to the 4,832,000 that were exercised and add another few hundred thousand possibly exercised on Thursday and today and the series A warrant holders are done.
The only thing left to really think about here with the warrants is the series C warrants which strike at $0.50, but you notice that there was not much interest in exercising the C warrants here. Only 892k of the C warrants exercised. Plenty of interest in doing the A warrants that strike @ 10 cents when the holder can sell In the $0.70's and $0.80's and $0.90's That is 7x and 8x and 9x your money and they patiently waited for it.
I think they wait on dollars per share with the C warrants and did you notice how readily the market absorbed the profit taking by the warrant holders?
I think we cleared the last hurdle on the road to higher prices. Nothing left standing in the way now.
They are are also expecting orphan drug designation by end of the month. Add that to the December catalyst pile.
I have had a most pleasant holiday time with my family. I hope all here have enjoyed the holidays as well.
It has been a prosperous year for me in general, but most of all I am thankful to be in my fifties and have good health and to see all in my immediate family have their health as well. Myself, my wife, my children, my grandchildren, and my siblings are all healthy. Sometimes we forget what is most important.
I hope that this thanksgiving has found all here in good health. You and your family as well.
On a secondary note (and it is secondary), may our little stock add to our financial well being in the coming year as well(as i strongly think it will)
It is probably best if you stay away from individual stocks. individual stocks are not suitable for anyone who does not do real analysis.