RE:Shelf Registration - Bad OmenHo-hum. Yes, you hear this complaint often on SH but it's knee-jerk, boiler plate stuff. The advantages of such a filing are concrete. Selling because you don't like it is speculative.
I really liked the BOI analysis, as well. This is the dull reality of the situation. QIPT quite obviously is "picky" and to make wads of money quickly would require a faster acquisition pace but you only need to look back at Dalsin and Greene to see where that can get you. People go into pennies for the sexy angle so I get the frustration since we are not following the plot. However, anyone who's held for several years should be very happy with where we are and where we are going.
Carlito3311 wrote: Good piece here: https://blogs.nature.com/tradesecrets/2012/11/16/the-s-3-barometer
excerpt below:
However, this is not the typical view. The filing of a shelf registration statement is often met with derision, and considered a bad omen that shareholder dilution is around the corner. If you follow any of the biotech stock watchers on Twitter, you know what I mean. My sense is that complaints arise primarily for three reasons:
- Investors seek to avoid dilution, and the issuance of new shares via draw downs from a shelf dilutes existing shareholders.
- Filing of an S-3 shelf registration signals to the market that a financing is forthcoming, thus creating an overhang on the stock, depressing its performance. In other words, why should big institutions buy shares in the open market if they can simply wait and buy in an upcoming follow-on financing?
- An active shelf is like a credit line for management that can be tapped at their discretion, so incentives are not fully aligned with shareholders if shelves are utilized haphazardly.