RE:Conv debsHI Mensplus,
The convertible deb recently done by ANY represents 666,666 shares and it was done at a premium at $7.50 US per share. The deb pays 8% annual interest. This recent pullback to me is normal based upon the progression of the share price since the move upward started in June/2013. The one thing I do know is that the short position in ANY is basically one institution and I believe they continue to be active based upon the 1.2 million shares that are now short. The daily trading activity over the last while shows that as they have put in market orders to hit the bid side of the market and drive the share price down. They love to show up at lunch time to sell and late in the afternoon before the close. You would think the regulators would look at the daily trading patterns and see what is happening. How that plays out for them only time will tell. The one thing I do believe is that ANY will surprise us with more positive developments both short term and long term. THis company is just getting started and Cormark has raised their target price from $8.50 to $10.50. Here is an exerpt from a few days back. Its about revenue and earnings and I believe Sphere will deliver the goods shortly. IMO
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Monday, March 24, 2014
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Sphere 3D Corporation (ANY - TSXV) - CAD 10.50
Closes Acquisition Of V3 Systems - Monday, March 24, 2014
Last Friday, Sphere 3D announced that it has closed its previously announced acquisition of V3 Systems. Concurrently, ANY also announced that it has completed a US$5 MM convertible secured debenture financing with Cyrus Capital Partners convertible at US$7.50. We believe the acquisition of V3 Systems is complementary to ANY given their respective strength with V3 Systems in desktop virtualization and ANY in applications virtualization that will have the combined company deliver a stronger end-to-end virtualization platform. From a financial perspective, we believe the transaction is accretive to earnings of $0.05-0.10 on an annualized basis, excluding amortization of acquired intangibles, without considering revenue synergies. We continue to value Sphere 3D using our 3-stage DCF in order to capture its long-term growth prospect given its early stages. Our revised analysis which incorporates the acquisition of V3 Systems has us taking our target price up to $10.50 (from $8.50). We maintain our Buy (S) rating. (Morning Notes)
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