RE:RE:RE:Trans Mountainufoolme wrote: Explain to me how the convertibles could restrict the sp rising above $24. Each 1000 debenture can be converted into stock at $24. That means you would get 41 and 2/3 of Aecon stock for each $1000 debenture. If the share price were to rise above $24, then obviously the debenture price would also rise above $1000, or the holder would simply convert them into shares. And in fact the company has the option to redeem the debentures if the share price trades for 20 consecutive days at 125% of the conversion price ($30.00) So seems to me debenture holders are safe from redemption until $30 per share, so would hold to collect the 5% yield.
I already explained to you about conv arbitrage works over a year ago. You refused to listen then so I wont bother re-explaining it. Just refer to my posts from a year ago, nothing has changed.
Everything I told you would happen has happened. The stock is capped and will continue to be capped by arbs shorting the stock as soon as it attempts to approach $24. Don't believe me? Have a look at the short positions of July, then look at the short position after earnings. Shorts soared. Why? Because these fekking debentures are extremly dilutive to earnings, over 6.5 million shares would be issued should the stock trade above $24.
There are 60 million shares out here, that is over 10% earnings dilution. A stock that hits a 10 year high is very significant event and the price almost always grinds higher. You rarely see a stock retreat massively after hitting decade high on great earnings and record backlog. So I repeat again, unless earnings triple to overcome the implied dilution this is going nowhere.