The shorts who had margin calls were forced to cover last Friday. Any remaining shorts are have been making money since the spike up.
It was brilliant of the Billionaire not to use his own money to rush the deal and use the shareholders money instead.
Any loser shorts who didn't cover a margin call was forced to cover on Friday. This forced buying will no longer occur. Anyone who has shorted since the spike has profited nicely. I suspect some will start cashing in on those profits around $6.50.
Since the news should have been baked into the price before the spike, the share price was already headed to $6.50.
The negative trend line should meet up with the positive trend line at about that point.
(...barring a catalyst of course.)
This was a short squeeze leftover from the rally. The loser shorts were forced to cover their losses today from their brokers. This is what supplied the buyers and increased volume at the end of today. The original short losers are now out of the equation. So there will be no more buying to cover from them.
I would expect to see the price go back down to where that short squeeze started.
Should note they hold a short position.
Also there was a whole part on a confidential letter. ...but what the letter contained was also stated in the 8-K....so not so confidential.
However, spending 7.5 million dollars of shareholders money to get it signed in time for the conference is an obvious misuse of 7.5 million dollars.
This experimental therapy lagged behind that of bigger competitors at the get-go.
Novartis, Juno Therapeutics and Kite Pharma are all up front with their own “CAR-T” cancer immunotherapy. These massive companies are way ahead of the MD Anderson technology, a doctor who is familiar with the technology told TheStreetSweeper.
“It’s a very competitive space,” he said. “Theirs does not seem like best of breed and they’re way behind.”
Starting out behind is a big problem. It takes many years to conduct trials to even get an experimental drug or technology ready to be considered for Food and Drug Administration approval.
No way is ZIOP a nearly $1 billion company, the doctor told TheStreetSweeper. And we agree. To be worth so much, it would have to be more than a no-name company with nothing but operating losses since inception and mounting financial obligations. A $1 billion company would at least have a product and a recognizable name. But we expect reality will hit and ZIOP’s valuation will swoon back to earth very soon. We don’t expect to wait long.
ZIOP has a history of heavy promotion, followed by disappointment.
It goes like this: shares falter so ZIOP runs out a story on a promising technology/drug/update, shares soar, shares collapse on a trial flop (its palifosfamide sarcoma study in 2013), repeat. And so it goes. But at some point, everyone quits falling for the story and waits for results, rather than facing another costly disappointment.
The MD Anderson technology uses “Sleeping Beauty,” an older way of putting genes into cells.
The body contains T-cells within the immune system that kill a virus or infection. Now, researchers are removing T-cells and putting genes in them that then attack the tumor. But the process produces side-effects that can make the patient very sick. MD Anderson’s technology doesn’t cause a lot of side effects, but a doctor who asked to remain anonymous, said it may be because it’s less effective in killing tumor cells.
ZIOP doesn’t have the money to pull off this deal. So we believe ZIOP will have to sell stock, posing imminent dilution.
ZIOP has just $46 million in cash. Its own quarterly report says that’s “sufficient to fund operations into the fourth quarter of 2015.”
But that was before the new agreement. ZIOP is burning over $7 million per quarter. And it is now committed to pay about half that much again - $3.75 million to $4 million quarterly - to The University of Texas MD Anderson Cancer Center in Houston each quarter for three years.
Shares worth $15 million offered as incentive to speed contract signing.
The day ZIOP was scheduled to present to JP Morgan, Jan. 14, turns out to be the very day ZIOP pulled this licensing announcement out of its ear. JP Morgan acted as underwriter during ZIOP’s roughly $54 million public offering in October 2013 at $3.50 per share. But that timing apparently was no mere coincidence.
If any of the loser short sellers did not cover, their margin calls will be due today. So if the buying you see at these levels is the last of the short covering, that buying will end in most cases at 1pm and 2pm eastern time. (depending on the broker.)
Pretty sure there was indeed a short squeeze when it went up 60%.
DEFINITION OF 'SHORT SQUEEZE'
A situation in which a heavily shorted stock or commodity moves sharply higher, forcing more short sellers to close out their short positions and adding to the upward pressure on the stock. A short squeeze implies that short sellers are being squeezed out of their short positions, usually at a loss. A short squeeze is generally triggered by a positive development that suggests the stock may be embarking on a turnaround. Although the turnaround in the stock’s fortunes may only prove to be temporary, few short sellers can afford to risk runaway losses on their short positions and may prefer to close them out even if it means taking a substantial loss.
Of course the article popped out after the announcement. The article was ABOUT the announcement.
He already said.
"Since there are approximately 100 million shares outstanding I just selected $50 million "
Here is the math... (his math not mine)
100 million shares divided by 2 = $50 million income.
Obviously your income in dollars should be about half of your outstanding number of shares.
(Makes no sense to me either.)
About 18 million shares were short. You can most likely assume that most of those loser shorts bought to cover.
Then the rest of the available shorts were borrowed. So you have new short winners who have made up to 20% so far. I would guess some of them have started to cover and take the easy profits. Although, many more may be waiting.
The time to be long was before the spike. The time to be short is now. Some analyst have said that it wasn't worth even a double digit spike. I would say that the news was pretty much built in with the run up earlier from 5 to 6. I would expect it to settle around back around 6 to 6.50.
Although, now you have to worry about them needing additional funds to meet there agreement. They will need more money this year.
I understand that it may be cool to announce the news at the conference. ...but it wasn't worth 7.5 million dollars to have the agreement signed early.
So ZIOP pays $7.5 million dollars worth of shares to have this announced at the JPMorgan healthcare conference...and then a JPMorgan healthcare analyst as nicely as possible bashes the stock.
Motley fool response: "Experts aren't exactly sold of the potential benefits of Sleeping Beauty. Data presented by MD Anderson researchers at the American Society of Hematology annual meetings the last two years failed to impress. While the preclinical data appeared to show a cleaner safety profile over other early stage CAR-T therapeutics, the data didnt perform nearly as well in efficacy. Moreover, some experts believe the improved safety profile was actually derived from the fact that the therapy isn't very effective.
The deal is also exceptionally dilutive and risky for Ziopharm. Consider that Intrexon is pursuing multiple collaborations across energy, health care, and food applications with its synthetic biology platform. Projects include everything from genetically engineered salmon to microbes that consume natural gas to produce cosmetics. If this project fails to achieve success it won't really hurt Intrexon. But since the majority of Ziopharm's pipeline is now based on Intrexon's platform, it won't be nearly as unscathed from a failed outcome."
excerpt from Motley Fool article, "Why Investors are Excited About Intrexon and Ziopharm's New Deal"
"The deal reflects the reality that both companies are a bit late to the CAR-T party, but there's more. Ziopharm has agreed to fund research activities at MD Anderson to the tune of between $15 million and $20 million per year for the next three years. The development stage biotech had $46 million at the end of September and burns roughly $7 million per quarter, meaning Ziopharm will need to raise additional capital in 2015 and beyond to fulfill its obligations."