My perspective on the conversion of the debentures My calculations show we had a run of 7 days where the VWAP was > $7.05 (see below). Here's hoping to the start of a new run where we can hurdle the threshold and force the conversion of the debt into shares. The elimination of the debentures will reduce interest expense by $6 million per year ($0.04/share fully diluted).
I agree with others comments that the effect of the dilution has been factored into the share price. Therefore, any collapse in price due to the conversion is a positive sign to buy shares on the cheap. Here is my "back of the envelope" math showing the effect of converting the debentures into shares and the reduction of corresponding interest expense. Reported Q1 earnings $29.5 mm. Add 1/4 of $6 million interest expense = $31 million divided by 151.1 million shares = $0.205 times 4 quarters = $0.82 earnings for a full year (conservative as it does not reflect the full annualized revenue/profit potential). $0.82 times multiple of 15 (again conservative) pegs a share price of $12.
GLTA!
VWAP
2/7/2019 $ 7.01
2/6/2019 $ 7.12
2/5/2019 $ 7.49
2/4/2019 $ 7.95
2/1/2019 $ 7.87
1/31/2019 $ 7.44
1/30/2019 $ 7.42
1/29/2019 $ 7.22
1/28/2019 $ 6.67
1/25/2019 $ 6.01
1/24/2019 $ 6.23
1/23/2019 $ 6.35
1/22/2019 $ 6.23
1/21/2019 $ 6.26
1/18/2019 $ 6.32
1/17/2019 $ 6.26
1/16/2019 $ 6.26
1/15/2019 $ 6.33
1/14/2019 $ 6.27
1/11/2019 $ 6.27
1/10/2019 $ 6.02
1/9/2019 $ 5.74