I agree techaserAt one point, the warrants were trading at .155 and the stock was at 7.88. At 7.88, the intrinsic value of the warrants is:
(7.88-3.15)/30 = .1577
This means that we have a negative time value. If I were a big arbitrage specialist, I would be shorting the stock and buying the warrants. You can't lose. Even at the .16 close, there is no time premium for the warrants.
This unusual activity might have something to do with short covering -buy the stock and sell the warrants. The way I see it, most all shorts are covered with an adequate warrant position. Typical of most deals where there are derivatives available.
I'm thinking about $1.40 eps for fiscal 2006 if commodity prices hold. I wonder what the boys plan on doing with all that cash. Especially considering that they will most certainly be raising north of $100 million when the warrants expire, barring some sort of catastrophic economic collapse..
Good luck to all longs
Jandd