ITEK's ace-in-the-hole (and I'm sure Cohen knows it) is the price that the company will get for the international rights to trabodenoson. There will surely be a bidding war -- maybe now or maybe later as the phase 3 proves successful. I think it would pay a partner to move now.
The company's big decision is when to sell the international rights to trabodenoson.
If they sell now, maybe get $200 million upfront plus milestone payments and royalties.
If they sell after successful phase 3, maybe get $500 million upfront and milestones and royalties.
The key to the whole investment thesis right now is the value of the international rights.
Pretty close to estimates -- maybe some would say a miss.
Backlog is usually the story with these types of companies.
The closing price of $5.84 seems to be a real undervaluation.
The strong dollar is still a problem -- maybe cost this quarter a nickel in earnings.
Still see buyout as best outcome.
Like to see more growth in procedure volume.
Twenty procedures in Q2 vs. 19 in Q1.
Otherwise, no complaints.
The hedges may be tricky to figure as their are collars on them.
They may only get $70 a barrel -- you have to really analyze the terms of the collars.
But good work in taking all these elements into account.
I think that's a fair question.
Their earlier statements on Upper EF potential were very optimistic.
Now it has been taken out of the drilling program.
New CEO should come from outside the company to restore credibility.
With higher number of shares to be outstanding and strong trading volume, I think we will get listed options.
Covered calls would probably fetch very nice premium if that is a strategy you use.
Valeant has made some questionable acquisitions in the ophthalmic sector (Macugen, Visudyne, EyeGate deal) but ITEK has the potential to be a real gem -- and a perfect fit with Valeant's Bausch + Lomb eyecare subsidiary.
In the prospectus for the secondary, ITEK clearly states that it only wants to develop the US market for itself while licensing the international rights to a partner.
The game plan may be to wait a bit on signing on with a partner to get a better deal.
I had previously estimates that ITEK could get about $200 million right now (plus milestone payments and royalties) for an international partnership. That could increase significantly if they wait and the phase 3 goes well.
Anyway, it is now clear that an international partnership is in the cards -- and that will be a future source of significant funds for ITEK.
One drilling rig for the remainder of 2015.
Upper EF was a disaster -- someone is going to look at management's earlier statements about the potential of the Upper EF and might start asking some serious questions. Also, I did not hear anything on the CC about purposely using tight chokes to prolong production life of Upper EF wells. Looks like they are just admitting it was a bad strategic move, especially with a limited drilling program.
Management thinks they have several options to raise new money such as joint ventures and asset sales.
They don't seem to want to talk about the shelf offering because then we are speaking of debt and dilution.
I think management paints a rosier picture than the reality warrants.
These guys clearly have talent as E+P operators but they let their egos get in the way of an earlier sale that would have been good for us as shareholders.
It was a very long "earnings" release but I didn't see the shelf offering mentioned.
There will be a need to raise capital -- more time to play out the string, I guess.
Posters on this board say that PVA management knows better than we do how to run an E+P company.
Well, for a time, they were sharp on Eagle Ford exploration and sharp on hedging.
Now, it looks like they made a bad bet on the Upper Eagle Ford and they missed a chance to sell near the top.
I definitely think the egos took over and they started to believe in their own infallibility.
I still have a little.
I don't short stocks.
By the way, I didn't see any mention of the $300 million shelf offering in that long earnings release.
PVA trying to pull a rabbit out of a hat in the Upper Eagle Ford.
Didn't work -- and puts them deeper in the hole.
(Management must have been watching James Dean in "Giant." Looking for another Spindletop well)
I apologize for being positive on this management for so long.
The initial production rates in the Upper Eagle Ford were awful -- huge drop as I have been noting in recent posts. With a sharply curtailed drilling program why are they messing around with low-yield acreage?
Of course, now PVA will be shifting strategies back to higher-yielding prospects -- I am still suspicious that the company has drilled its best acreage already.
Production on a downward path -- so big deal they are saving money on well costs.
I believe the company is being honest in explaining these shortfalls but there is no path to profitability here.
In order to get a decent takeover offer you have to show that you have a decent production profile.
All I hear is a lot of excuses for poor execution.
The only thing I can praise is they are being honest -- but honesty doesn't buy the groceries.
I only look at fundamentals
This is very tough surgical procedure to learn -- most eye docs won't attempt it. GKOS has competition as well in this new type of surgery. Not going to be a fast grower.
I am more inclined to a gene therapy company like AGTC -- which made a very nice partnership with Biogen. Lots of potential and good science team.
EYES also very interesting -- good people and a big lead in technology.