Moody's gives Atlantic Power a B2. B1 is better, B3 is worse.
Aaa highest quality, minimal credit risk.
Aa high quality, very low credit risk.
A upper-medium grade, low credit risk.
Baa moderate credit risk, medium grade may have speculative characteristics.
Ba speculative elements, substantial credit risk
B speculative, high credit risk.
Caa poor standing, very high credit risk.
Ca highly speculative, likely in, or very near, default, some prospect of recovery of principal and interest.
C typically in default, little prospect for recovery of principal or interest.
I've been watching Cardica for years. They have always been walking on the edge of the abyss as far as cash is concerned, but they have always been able to raise cash just before running out. With the FDA clearance for the microcutter, raising cash will be easier. If you look at latest 10-Q you'll see that they raised $14M at $1.05 per share last March, so apparently they need $14M per year to operate. With 51M shares outstanding, they could offer 14M shares to the public at about $1.10 and that should keep them in business for another year. During that time they can make a lot of progress and show a sales ramp up for the microcutter and PAS-Port.
I think Applied Medical sold most of its 2.5M share war chest of Cardica stock trying to suppress the stock price after announcement of FDA clearance. Its been selling its shares in hopes of keeping Cardica shares cheap to make it harder for Cardica to raise money in a public offering, and at the same time, making it easier for Applied Medical to acquire Cardica. Now that J&J sold its blood business to Carlyle for $4B, J&J should be on the lookout for complementary acquisitions.
Very typical trading pattern. Traders piled in on news of FDA clearance, while those who were already in took profits, not wanting to stay around for news of a dilutive public offerings. We have to wait for the short term traders to exit before it bottoms out. The short term traders are in pain since they bought higher. Next event is the earnings release. Last year, earnings release was on Jan 31.
.... would include a Rights Offering or a Loan.
How about a loan with the IP as collateral.
I'd gladly participate in a rights offering.
A Rights Offering is an issue of rights to a company's existing shareholders that entitles them to buy additional shares directly from the company in proportion to their existing holdings, within a fixed time period.
The trading action follows the standard trader's playbook; sell on the news if bad news is expected to follow (dilution due to public offering).
The playbook would then tell you to buy the dip resulting from news of a public offering.
I think the biggest basher was Applied Medical Co. who ordered their broker to sell at the most propitious points to drive the stock down, but in the last two days they must have spent at least a million shares leaving them with only 1.6M shares or less. AMC's supply of Cardica shares is dwindling. I did see significant buying today. The biggest transaction was a buy of 80K shares.
Good news but stock goes down .... a divergence. Divergence can be profitable if you understand it and can take the dissonance.
Applied Medical Co is selling its Cardica shares to suppress Cardica stock price. This would facilitate AMC's acquisition of Cardica. I'm accumulating shares and betting that AMC will fail.