Post by
petebrown1963 on Jun 01, 2021 1:50am
Preference shares conversion
This has been known for a long time, and accounted for in the price. Topicus is a little more expensive than Constellation, but this is because it has higher potential growth. This is because of the Law of Big Numbers, ie. it is easy for a company with $2 million revenue to double sales, but it is very difficult for a company with $200 billion revenue to double sales. All in all, if you are looking for growth over the next ten years, you want to be in Topicus not Constellation. I say this as someone who first purchased Constellation at $75!
Comment by
hotdog123 on Jun 01, 2021 8:59am
Where do you see the stock price settling? Now and after next February with the conversion.
Comment by
hotdog123 on Jun 11, 2021 8:13pm
Those 69M shares coming won't help the share price though...
Comment by
petebrown1963 on Jun 17, 2021 9:15pm
That's not how the market works. If the news is out, it is accounted for in the current price. The preference share issue is old news. On the other hand, if the company announces a new issuance of shares next week, the share price would decline immediately after the announcement to compensate for the dilution.
Comment by
Capharnaum on Jun 17, 2021 9:42pm
My problem is that the numbers don't look that good once you compare them to the $10B market cap with the converted shares. I mean it will trade at 25% of Constellation's market cap but revenues are 15% of Constellation's. So on a numbers basis, might just be best to buy Constellation, especially since CSE will own a good portion of Topicus anyway.