Ok - Fidelity called back this AM.
The most likely scenario, if past standards are followed, is you keep your QCOR trike but each option is 89.7 shares. The underlying value of the option remains MNK price times .897+30. So - it is just as Sikantmarakani described . Doesn't seem fair, because essentially, we theoretically would have that same underlying value at close of deal and have 100 shares per option, then suddenly only 89.7
If. I am thinking right, that hurts calls and helps puts.
An - but you forgot the daily knockdown. But it would appear - though who knows for sure - we have started higher highs and higher lows. Saram - what do you think?
Who knows why the thumbs down - the more honest opinions we have here, the better.
I shared your thought, just didn't say it. But I do note it went higher than yesterday on the up. Are we in a beginning trend of higher highs and lower lows? No way to know until the trend gets bigger. I have seen them come back on a Thusday and make it a down day. It does seem that QCOR is also being influenced by the general market these last few days.
Someone allegedly a doctor but not an honor of MNK said the raise in price on the drug would lead to a decrease in use. I spoke with an experienced nurse friend who is sharp and here is what she had to say
When use of a drug increases, the pharma companies increase price. Standard practice.
The guy could be legit and his hospital is eliminating IV Tylenol - for now. It is a breakthrough drug and they will have to relent - the uses are phenomenal.
IV Tylenol is the first intravenous Tylenol EVER. It seems to eliminate the liver toxicity issues associated with Tylenol completely, while provided steady small doses to the body, so dosage stays constant and level.
More importantly for surgery, , putting people on the drug before and during surgery reduces the need for opiate painkillers.
My friend told me that the uses for IV Tylenol I are going to increase, and that it is a very in demand drug now.
She says the doctor may be a crotchety guy who knows the value of the drug and is annoyed that his hospital is cutting him off from it for now, as the drug is pretty much available only in hospitals.
Yes - you can see on shortanalytics, a free website that you can get easily from googling, that yesterday the shorting was heavy, 48% of total volume. They are likely doing something similar today. Shortanalytics will not report today's shorting until 8 PM, but you can go on the site now and see I am telling the truth. Despite the gap that needs to be filled at $2.79, I may add more today.
A $1.80 would translate to a combined MNK worth $84, which puts Q at over $104.
Suspect this is more realistic than people focused on a big squeeze, but who knows. MNK was at this price after its Q1 earnings, so market was focused on this number then. Does market look and think ahead to Q3 MNK number after these earnings?
I am noticing that for most if not all posts, they do not get bumped to the top if someone comments. Nor do they show who has posted the most recent comment, in many cases, but just show the name of the person who posted the topic.
Wise words - great strategy -
I would just add one more possibility - you don't mention shareholders' meeting, probably because it is a different piece. But even if earnings for both companies are not as strong as we want, two Yes votes and both stocks jump. Someone did point out to me that if one company delivered a No vote, could be a big though likely temporary problem, as the companies could try the vote again.
I like your conceptualization - I believe it was is likely to take place by a formula that can apply to 1 call or put.
Any fractional shares, whether through stock conversion or exercise of the non-standard options that will be created, are sold off at the going rate. Inother words, if you have .5 of a $100 share, it is sold automatically for $50. I know this latter part from experience.
Looks like they are controlling the price, preventing it from getting higher than 95s at EOD. I have no idea if this continues. Makes me wonder what they have planned for next week. Everyone assumes that a big beat makes for a spike, but I for one do not understand the rigging of the market to know.
I still haven't gotten the clarification I wanted from Fidelity, but a rep assured me this - that the standard procedure i(but we don't know for sure what the companies will do) is to retain theintrinsic value in the converted option. In other words, if you had, say, a QCOR 100 strike and QCOR PPS was $101 at the close of deal, the call would be worth $100. The formula would likely yield you a call that was good for MNK that was worth the same $100 while market was closed - time premium likely doesn't enter into it for the conversion and may be lost, based on other conversations I have had with other reps.
So - any strike price can be converted, whether out of the money or not. I forgot to ask, but I am GUESSING that any gain you have at the time (or losss?) gets locked in and a new cost basis and purchase date comes in for the "new" option.
If I am right, would stink if you had a LEAP that would have gone long in September -
I am not sure I understand what you are saying. It is not clear to me how the QCOR strike price is converted.
So let me give it as I am reading it from above.
The underlying stock value becomes 30+MNK price times .897
That means that MNK at 75, for the QCOR option, would have an underlying value of $97.275 in the QCOR option.
But you are saying that whatever the QCOR strike, the call represents 89.7 shares after the merger.
So a QCOR option at 97 or below would be ITM, but only 89.7 shares per call will be delivered.
Thank you for any clarification you can bring to this.
yes it does - somewhere over $4 at the least. When Abstral sales ( likely great growth are reported and guidance given on the new drug, folks will notice, as the Abstral sales have followed the trajectory oulined by management, so it is likely that sales of the new drug will match their projections, too.
This is actually to one's advantage - the longer this stays underpriced, the more of a bargain it becomes.
isn't that the point? That there is huge room for sales growth in a 1 billion pharma sector. That is why Roth Capital said a conservative estimate would be revenues of 20 million dollars. Sounds like GALE made a great move, and why Roth raised the outlook for the stock to $8