RE:Short Position as of Dec 15Thanks, again, ark, for posting this, and to everyone for their positive contributions!
Regarding these shorts, as it becomes apparent with the share price well supported over $2.00 and not looking back, that the warrants could be forced, I understand short sellers would and do see this as a potential cause the sp to decline because some warrant holders will sell upon exercising, either because they want to make a quick profit, can’t afford to hold the stock longer term, or due to holding too many TOS shares in their portfolio, fund, or account (or more than they want or can by their rules allocate to TSO3). Hence, the warrants are an overhang on the share price and the shorts are trying to game this trade.
This is, I presume, the logic used to explain that a short squeeze will not happen: the shorts will just hold on and let the warrants be forced so that they can then take advantage of the downward sp pressure brought on by many willing to sell to take a small or large profit.
But, we don't know how many of the warrants have already been exercised already. Perhaps, another million or more were exercised over the past month, especially following the Getinge deal? Of course, over the medium term, getting the warrants out of the way will allow the shareholders to see TSO3 valued closer to its intrinisc worth, (at least over $4.00). But, only management knows how many warrants remain. Only management and their consultants, including the new CFO, can make this judgment about the warrants in the best interest of the company and shareholders. Would the potential short-term downward sp pressure not be a good reason for Rumble to NOT force the warrants, but rather just allow them to continue to be exercised voluntarily as holders wish to take profits slowly into the coming months, reserving the right on TSO3's behalf to force exercise of the warrants in the event, for example, of a sale of the company, to Getinge or a higher bidder or some other need arises that makes the company decide that forcing is in the company and shareholders interest?
Not needing to force the warrants might seriously trip up the shorts on their own long laces as they can't in any way be sure management feels any immediate need at all to do this, (the company has adequate cash on hand for expansion with the Getinge deal, so what's the big hurry...?). Would this miscalculation not leave the shorts in a position that they would need to cover and get squeezed, albeit slowly, over the next weeks and month and take their losses?
Just my thoughts. WKH