Affymax, Inc. (AFFY) Message Board

Nice, informative post, way to contribute something.

I disagree with the below sentiment that they were sold to open for "free cash". I believe that I saw those go by on the ask side, pushing the price up, and not on the bid side, so they were bought to open by someone establishing a short position. I am equally concerned that someone is opening up a position to profit in the even the stock tanks. I wish i had a good answer for why, but i am just saying i think they were on the ask side not the bid side.

The price reflects a chance of losing everything or gaining everything. If the decision was clear, the price would be 0 or the price would be 10 dollars. Fear has driven this stock down and you may be buying at a bargain. I agree with max dad below and will summarize my outlook.
1) buyout at 8 dollar, most likely, 60% chance. There are assets on their balance sheet (Net operating losses worth 100 million) and a drug that takeda would probably like to own 100% instead of 87%.
2) shell company worth 6 dollars, unlikely in my opinion, 10%.
3) bankruptcy, likely. 30%. I discount this because they would have flat out said they were going bankrupt earlier instead of using vague language. Also because large institutions haven't sold out, like vanguard, and because if they go bankrupt acquiring companies lose the ability to get 100 million in NOLs.

I don't agree. Because netflix keeps the reviews of House of Cards in-house, and they have a conflict of interest in doing an independent assessment of the show, they have obviously made the reviews sound good. Same with hemlock grove. I will counter that with arrested development, which will absolutely be a hit. However, this leaves them 1 for 3, and the ability to grab old shows and remake them will be the driving force of new content on NFLX. I would not sign up for NFLX to see hemlock grove when i have never heard of it, but i would sign up for arrested development. Maybe for new seasons of weeds. However, the price of remaking old tv shows will go up, and they will have to fight 100 million per season.

That is not what i found, there were 3 million shares to be borrowed at my broker, up from 1.7 million last week. The annual price dropped from .75% to 0.5% and then this week went back up to 0.75% despite the increase in share availability. I do think there are less people shorting this stock, which has driven the growth in share price. However, I also think that if there is evident weakness in the stock, those shorts will pile back in.

The stock jumped 33% since the time of that announcement and i believe that increase is priced in. They scored big with Arrested development, but i don't think house of cards is the success that they claim it to be. I stopped watching partway into the season and then canceled my netflix because i couldn't find any good movies to watch. They have to have more than 2 headliner new content shows because people will binge watch these shows and then cancel. On an expected 2-3 dollar earnings i'd give them a 60-80x multiple because of the growth potential, but I wouldn't give them more than that because the growth won't be seen year over year. When they have hit 40 million viewers, they won't be able to go higher at the same rate.

I wonder if this means that amount that they paid, the 628 figure in your calculation, is still up for grabs and they might be able to claw back some of that.

Lol. got a laugh out of that.

thanks for the comment, always interested to hear what you have to say.

i stared at option chains for hours trying to figure out how the prices were generated. Eventually it clicked and lo and behold later i find out that someone else named black and sholes had come to the same conclusion.

Are you actually going to hold it overnight? it seems like the way to do it is to short at the opening and close by the end of the day.

I don't buy this at all. Anyone who has to resort to writing books to make money and going on fox news can't be making money in the market. People spout this doom and gloom all over the place, mostly, in my opinion, because they've sold their position a month ago and then missed the next 5% rally and now they're asking for it to come back so they don't have to chase it.

The fed will move from pumping 85 B into the market monthly to pumping 45 B into the market monthly. This will cause a short dip on the day of that announcement but the reality is that it will signal that the fed believes there has been recovery, and you will see a rise after it. Average people haven't been putting their money into the market (we're at 52% of average people investing compared to 65% for the past 15 years). They will start flocking in and push the prices up once they perceive money to be made in the market.

According to my research, you are most definitely incorrect on this. If there is a 50% change in control, the NOLs are limited, but not lost. Here, let me copy and paste:

More specifically, if as a result of a stock transfer or a reorganization, a corporation undergoes an “ownership change,” Code Section 382 limits the corporation’s right to use its NOLs each year thereafter to an annual percentage (for May 2009, the federal long-term tax-exempt rate is 4.61%) of the fair market value of the corporation at the time of the ownership change (the “Section 382 Limitation”).

I just looked up the current Tax exempt rate, it is 2.84%, meaning that NOLS of a company bought for 300 million are 8.52 million per year for 20 years, or 170 million.

They have a drug and 500 million in NOL, for which a reasonable 300 million might be obtained in a buyout of price 10/share or more according to my reading of S382. That 300 million in NOL would be worth 100 million dollars to a company like takeda. I choose to believe that the 300 million in NOL trumps the few lawsuits and other costs that they have floating and makes it worth buying out AFFY for a price of 370 million.

Thus the calculation takeda faces is: is it worth 370 million to buy a drug that they might bring back and 300 million in NOL, making the net price of the drug 270 million.

That's what I've been hoping, as I watched the trailers come out this past weekend and saw the associated spike in share price. However, what they haven't released yet are the "increase in viewers" data. I'm expecting a spike on that- if they say "AD pulled in a new 1 million viewers" that's going to make the stock jump because it's confirmation of true revenue for them.

Imagine his surprise when he finds out he bought 100 shares of AFFY instead of AFFX! No wonder the shares were so cheap, he thought he had gotten a good deal at 1.40, when they should have been 3.72.

It does appear that way.

Ah thanks, I didn't get the exact date. But in the meantime he's probably selling calls against his position at this level.

how do you think he's hedging?