Avid Bioservices Inc (CDMO) Options

Once again, the markets are up huge...especially the Russell (which we are a part of)...its up over 3%! We unfortunately are down today...the CDMO trend to upper $11's made no sense and now the retrenchment to the mid $10's again is confounding, especially in the face of such a strong market.

Oh well, in the end it is all about filling the excess capacity....we will see where this goes!

We should see a DEF 14A next Wednesday announcing the ASM will be Oct 16th and will be Virtual again.
I am sure we will get a BOD report that Avid's management has done a great job and will get close to maximum amount of PSU's, RSU's and maximum annual bonuses.
Nothing changes, the aloof management continues

I saw the elites of Avid patting each other on the back in regards to some accomplishment at VV. Too bad they don't share this accomplishment with the owners of Avid. These people are so condescending with regards to who really owns the company. The BOD allows this so sad.

As for Hart and Ziebell, not only did they increase our expenses by $2 million a quarter, they gave away 15% of the company in dilution because of conversion rate on the new convertibles. Nobody takes responsibility. Elite and condescending attitude for sure.
Check out what Hart and Ziebell got in PSU's and RSU's
I rest my case!

With the low volume, the MM can easily move around the share price, and while it feels better to be at $11.50 then $10.76, it is all about the upcoming CC, if we have an upside surprise on revenue and projections we go higher, and if we do not, or God forbid have a downside surprise...we go back down. What will cause the shorts to cover?????

The Viral Vector team has been getting congrats from Nick on Linked In for their performance, so perhaps they will announce some new contracts at the CC in 2-3 weeks...that would be good, but I have learned from past CC disappointments not to get your hopes up too high?!

Yes those 2 clowns cost all of the Avid shareholders a lot of $$$$$.........this little black mark on their resume would be tough to explain away to any future employer...but no worries as they remain gainfully employed at Avid!

Last yrs were -313k less so that adds more questions to why the larger variance…but then it might account for why Hart and Ziebell are still employed?…ESG financial horse shoes… imao…r

Glad we can trust the economic numbers coming out of our government.
Opps missed the employment numbers lol

"Breakout trade: WATCH for possible breakout above 11.68...

Target: 12.98, 14.2% Stop: 10.85 Loss: 4.6%
P/L ratio: 3.1 : 1 - Excellent"
********************************

At Least According To:
https://www.stockconsultant.com/consultnow/basicplus.cgi?symbol=CDMO

Glta $CDMO Bulls, Watchers, & StockHOLDers!

Biotech Investor put a Yahoo link to a long article from the Telegraph, analyzing HALO, about 45 minutes ago on the HALO board.

HALO has been on a tear. Up another 1.60 to $61. Up $10 in the last week or so.

21.90%Short Interest on Merrill.

"Breakout trade: WATCH for possible breakout above 11.08..."

"Target: 12.35, 11.8% Stop: 10.61 Loss: 4%
P/L ratio: 2.9 : 1 - Good"

***************************

At Least According To:

https://www.stockconsultant.com/consultnow/basicplus.cgi?symbol=CDMO

Glta $CDMO Bulls, Watchers, & StockHOLDers!

08/19/2024 7:00:00 EDT I 11.33 44 NSD
08/19/2024 7:00:00 EDT I 11.33 48 NSD
08/19/2024 7:00:00 EDT I 11.24 48 ARCA
08/19/2024 7:00:00 EDT I 11.56 92 EDGX
08/19/2024 7:00:00 EDT I 11.25 8 EDGX

We need a good old fashion short squeeze.

GOOD CLOSE AT $11.01!
At the very least holding $11 EOD is a good sign moving forward!
Good peaceful weekend to all!

Light volume but we just traded over $11....will they sell it down into the close, or are we finally breaking out here?

Yeah, I can't figure why there are so many shares shorted or how the convertibles are affecting the share price. The convertibles can be converted at $9.89 per share if the share price trades for 30 consecutive days(I think) at 130% of converted price so $12.85. If we get to $12.85 then the 14 million shorts lose quite a bit of money.
Go figure?

Ya well...that is definitely above my pay grade, although it would certainly be in the interests of the shorts to keep the share price down(the question is why? Trying to keep the market cap down for someone wanting to buy them out down the road?)....as for the convertibles....the question is, at what price would they convert as they are getting a very nice dividend right now on the interest. So if I held this loan and was getting over 7%, what would it take for me to lock in my profits and convert to shares(which may very well go down 10% to 20% depending on when the convert is triggered) being aware of the dilution factor.

$160 million divided by $10 per share equals 16 million shares(but of course that would assume they convert at $10 which they would not)
$160 million divided by $15 per share equals 10.6 million shares or a dilution of approx 15% dilution plus or minus
$160 million divided by $20 per share equals 8 million shares or a dilution factor of 12% plus or minus

So the question is, when/if they convert, would they try and sell immediately or over a month or so, or would they be longer term holders?

In my mind, $15 plus in the short term may be enough to trigger conversion, however they can just sit pretty and collect their interest and wait for a buyout offer any time until the loan comes due and possibly get a much bigger pay day!?

Lots of AH activity. 884,369 sh

08/15/2024 16:13:41 EDT T 10.68 299143 NDD
08/15/2024 16:13:10 EDT T 10.68 138899 NDD
08/15/2024 16:02:36 EDT P 10.68 330 NDD
08/15/2024 16:02:06 EDT P 10.68 374 NDD
08/15/2024 16:01:54 EDT P 10.68 600 NDD
08/15/2024 16:01:36 EDT I 10.68 30 NDD
08/15/2024 16:01:34 EDT T 10.68 110200 NDD
08/15/2024 16:01:18 EDT P 10.68 636 NDD
08/15/2024 16:01:07 EDT T 10.68 119500 NDD
08/15/2024 16:00:49 EDT T 10.68 79600 NDD
08/15/2024 16:00:32 EDT T 10.68 128742 NDD
08/15/2024 16:00:11 EDT P 10.68 2425 NDD
08/15/2024 16:00:11 EDT P 10.68 306 NDD
08/15/2024 16:00:10 EDT P 10.68 400 NDD
08/15/2024 16:00:01 EDT T 10.68 884 NDD
08/15/2024 16:00:01 EDT T 10.68 307 NDD
08/15/2024 16:00:00 EDT I 10.68 2 NDD
08/15/2024 16:00:00 EDT T 10.68 200 NDDr
08/15/2024 16:13:41 EDT T 10.68 299143 NDD
08/15/2024 16:13:10 EDT T 10.68 138899 NDD
08/15/2024 16:02:36 EDT P 10.68 330 NDD
08/15/2024 16:02:06 EDT P 10.68 374 NDD
08/15/2024 16:01:54 EDT P 10.68 600 NDD
08/15/2024 16:01:36 EDT I 10.68 30 NDD
08/15/2024 16:01:34 EDT T 10.68 110200 NDD
08/15/2024 16:01:18 EDT P 10.68 636 NDD
08/15/2024 16:01:07 EDT T 10.68 119500 NDD
08/15/2024 16:00:49 EDT T 10.68 79600 NDD
08/15/2024 16:00:32 EDT T 10.68 128742 NDD
08/15/2024 16:00:11 EDT P 10.68 2425 NDD
08/15/2024 16:00:11 EDT P 10.68 306 NDD
08/15/2024 16:00:10 EDT P 10.68 400 NDD
08/15/2024 16:00:01 EDT T 10.68 884 NDD
08/15/2024 16:00:01 EDT T 10.68 307 NDD
08/15/2024 16:00:00 EDT I 10.68 2 NDD
2024 16:00:00 EDT T 10.68 200 NDD
08/15/2024 16:00:00 EDT T 10.68 900 NDD
08/15/2024 16:00:00 EDT I 10.68 68 NDD
08/15/2024 16:00:00 EDT T 10.68 280 NDD
08/15/2024 16:00:00 EDT T 10.68 120 NDD
08/15/2024 16:00:00 EDT T 10.68 100 NDD
08/15/2024 16:00:00 EDT T 10.68 320 NDD
08/15/2024 16:00:00 EDT X 10.68 124809 NSD

Where does the 14 million shares that are shorted fit in?
How about the convertibles at $9.89?

We seem to be stuck in this $10 to $10.75 range regardless of what the overall market is doing. The share price never seems to vary much from the $10.50 range...if it closes on the upper end($10.75 plus), you can pretty well count on the share price pulling back the next day, and if it closes closer to the $10 mark, once again you can be assured that it will again move back into the $10.50 range within a couple of days.......all this on lighter than normal volume.

What does this mean? No idea, other than it will take some kind of catalyst to move us to the next level, and not really expecting anything positive or negative until we get more news at our upcoming CC in September. So we coast here and wait for news and volume.

Fingers crosssed that we get a good solid upside surprise in September?

Some trading at $11 this morning,
08/15/2024 9:31:57 EDT F 11.00 2865 NSD
08/15/2024 9:31:57 EDT I 11.00 2 NSD
08/15/2024 9:31:57 EDT I 11.00 10 NSD
08/15/2024 9:31:57 EDT F 11.00 500 NSD
08/15/2024 9:31:57 EDT I 10.99 16 NSD
08/15/2024 9:31:57 EDT I 10.99 5 CBOE BZX
08/15/2024 9:31:57 EDT F 10.99 100 NSD
08/15/2024 9:31:57 EDT I 10.99 5 NSD
08/15/2024 9:31:57 EDT F 10.99 100 NSD
08/15/2024 9:31:47 EDT F 10.99 100 MIAX
08/15/2024 9:31:27 EDT 11.00 100 NDD

State St dumped nearly half their holdings for the 6/30 filing...also interesting that Steve Cohen filed a 13d on 4/25 for 3.226 mil shrs but the 6/30 filing now shows 2.673 mil. ...confirmed from yesterday 13-f filing by him... https://www.sec.gov/Archives/edgar/data/1603466/000090266424005149/xslForm13F_X02/infotable.xml ... Fintel showing 108.69%...r

The LA Times did a followup article on the tremblor from Monday ...key point was...'The Puente Hills thrust fault system is in a broad zone directly underneath the densest parts of the L.A. area, including downtown Los Angeles, which has many old and unretrofitted buildings, as well as broad swaths of southeast L.A. County, the San Gabriel Valley and northern Orange County.' ...r

Green trade notation was stock option trade
8/13/2024 13:18:08 EDT V 10.73 86000 NDD

How about selling some long term Puts, and collecting $$$?

Looking at the short interests number I posted last Friday.
The $125 million 2025 1.25% convertibles had an exchange rate of $21.21 if fully converted in to common stock around 5.8 million new shares would be issued
Short interest remained around 5-6 million from when they were issued April 2021 until March 2024 when replaced with the $160 million 2029 7% convertibles
with an exchange rate of $9.89 if fully converted in to common shock around 16 million new shares would be issued

Since the new convertibles have been issued the short interest has shot up to 12-15 million shares.

The total short numbers over the last few years seem to mirror the convertible offering if converted

Could our big shorter be our owner of the convertibles in some kind of arbitrage trade? If so the short trade has no risk above $9.89.because if the stock shoots up they can convert and deliver the shorted shares back with the newly converted shares

CNN
—
A magnitude 4.4 earthquake occurred in Los Angeles at 12:20 p.m. PT, according to the US Geological Survey. The quake had an initial reported intensity of 4.7 but has since been revised down to 4.4.

The shallow quake was only 7.5 miles deep and directly under the populated areas of Los Angeles, so was likely felt widely despite the relatively modest intensity.

A US Geological Survey map marks the epicenter and range of a 5.2 magnitude earthquake that struck near Bakersfield, California on August 6.
RELATED ARTICLE
5.2 magnitude earthquake near Bakersfield rumbles through Southern California
Earthquakes of magnitudes 4 to 5 generally bring light shaking and very light to no damage.

Northeast... https://earthquake.usgs.gov/earthquakes/eventpage/ci40699207/map?historic-seismicity=true&shakemap-intensity=false ...r

4.4 magnitude earthquake close to Los Angeles. Effect? I didn’t see whether it was N or S of L.A.

According to stocktadotcom the chart is very bullish.
CDMO Analysis
CDMO Avid Bioservices Inc Add to Watch List FAQ
Symbol
CDMO
Last Trade
10.57
Date
Aug-12-2024
Change
0.04
Open
10.58
High
10.58
Low
10.48
Volume
5,747
Note: Canadian symbols now end in .c i.e SYMB.C

Analysis
Overall
Very Bullish (0.57)
Short
Very Bullish (0.51)
Intermediate
Very Bullish (0.58)
Long
Very Bullish (0.60)

Short interest up 1.6 million
I put the closing price on the date of short reporting.
It sure looks like someone has lost money shorting Avid???

Avid Bioservices, Inc. Common Stock (CDMO) Short Interest
Settlement Date Short Interest Avg. Daily Share Volume
07/31/2024 13,926,941 1,436,604 $10.44
07/15/2024 12,311,618 1,034,321 $8.32
06/28/2024 12,358,079 1,235,553 $7.14
06/14/2024 15,076,940 820,884 $7.09
05/31/2024 11,510,830 805,811 $8.09
05/15/2024 11,862,647 1,220,692 $9.25
04/30/2024 11,056,967 1,071,600 $7.63
04/15/2024 10,322,378 984,233 $7.80
03/28/2024 10,110,394 1,114,601 $6.70
03/15/2024 10,842,004 2,873,857 $6.29
02/29/2024 6,593,041 894,032 $7.68
02/15/2024 5,649,903 992,362 $7.70

here we go again, up on low volume with a ceiling around 10.5. One of these times it is going to break through.

FFTT
JBAIN

According to fintel Institutional ownership has gone from 108.72% to 110.12% today.

The next earnings call should be around 9/7.

trading pattern looks to be MM accumulating a long position for someone with an average PPS around $10.50.

FFTT
JBAIN

Myriam Alvarez has a 43% positive return rating with an overall return of .2% if you held the stocks she recommended for 1 year. So, she is successful 43% on her calls….not even 50/50 in an up market like we have had over the past year. But if you bought all of her buys and sold all of her sells….you would be up .2 of 1%…..and how much did the various markets go up on the past year?

She is not an analyst…..she is a financial blogger.

Uhhhhhhh……I think I will take her buy and sell recommendations with a grain of salt…….and then do the opposite.

From SeekingAlpha
Facing Valuation Risks Despite Increased Capacity
Aug. 06, 2024 6:23 PM ETAvid Bioservices, Inc. (CDMO) Stock
Myriam Alvarez profile picture
Myriam Alvarez
1.42K Followers

Play
(12min)
Summary

Avid Bioservices expanded its revenue capacity from $120 million to over $400 million, focusing on CGT.
CDMO specializes in cGMP for mammalian cell culture products, ensuring compliance with FDA standards.
The company's backlog increased slightly to $193 million in Q4 2024, indicating steady future revenue potential.
Despite positive growth prospects, financial underperformance and valuation concerns led to a "Sell" rating on the stock.
3d render. Pharmaceutical manufacture background with glass bottles with clear liquid on automatic conveyor line. COVID-19 mRNA vaccine production platform.
wacomka

Avid Bioservices, Inc. (NASDAQ:CDMO) is a leading contract development and manufacturing organization with over 30 years of expertise in the biopharmaceutical industry. The company serves biotech firms that develop biological treatments for cancer, autoimmune disorders, and infectious diseases. CDMO specializes in current good manufacturing practices [cGMP] for products derived from mammalian cell culture, assuring FDA-revised quality and safety standards in the manufacturing processes. CDMO has also expanded into the cell and gene therapy [CGT] sector and boosted its revenue-generating capacity from $120 million to over $400 million. CDMO is well-positioned to capitalize on the ongoing onshoring drug production trend, generating new opportunities for steady growth. However, despite the positives, CDMO continues to underperform financially. Its mounting losses and my valuation concerns on the stock led to rate CDMO a “Sell.”

Pharma Manufacturing: Business Overview

Avid Bioservices is a contract development and manufacturing organization with over 30 years of experience in biopharmaceutical production. CDMO provides manufacturing services for firms that develop innovative biological treatments for conditions like cancer, autoimmune disorders, and infectious diseases at the clinical and commercial stages. The company specializes in current good manufacturing practices [cGMP] for biopharmaceutical products from mammalian cell culture, encompassing processes for producing biological therapies

Some of the institutions are beginning to report updated holdings...r

Just as it was tough to punch through 8.5, it should be just a little easier to get through this level of 10.5 to 11. Still no takers on the $40 PPS buyout bet.

FFTT
JBAIN

It will be interesting to see the updated short interest number. I think the results will be out tomorrow.

Amazing CDMO is green. The only stock on my watch list that isn’t red.

I don't think a buy out at $15 would be approved.
IF management sees AVID is on course to fill capacity over 2 years they should be able to plot that chart and relate it to share price. If they see could increase in fill 50 percent of current capacity in three to four of the upcoming Q's they can do the math. A 120 million dollar increase with 30 percent gross margins 40 MM EBITA. Approximately increase EPS by .75. with. 20PE that alone would add $15.00 per share. I think we are 1 to 2 years out from a buyout. In the meantime coming reduced interest rates will put the wind to our backs for once pipeline products are waiting on NDA.s . HALO needs more product depending if we capitalized on teh Catalent situation.

Should be an enjoyable ride for the immediate future.

I think about $40 would be reasonable. This comes from an EBITDA of $125,000,000 and a multiple of 20. These numbers are from Laughing Waters and they seem to make sense. I don't see a buyout any time soon at anywhere near this SP. I may be naive but I think they had some more business lined up before the expansion that may have been delayed for some reason. It happens.

Hopefully we are not included in the Russell 2000. The selloff will less affect CDMO.
Shorts need to cover...!

The IIs will have to approve the buyout. I doubt they will vote in favor of a buyout at 15 when a large percentage of their shares were bought in the 20s and 30s. They stand to lose at lot with a buyout of 15.

If you look at what Green and others get in a “Change of control “ situation I think they would be more than happy with $15

We are at 10 also because of 12 million shorted shares which is 20% of the outstanding shares. We probably have been going up about 50% over the last month due some short covering. More short covering and we will probably be above 15 and higher. I think the buyout base price should be at least 15. That would would put the buyout at 22 or higher. Easy for anybody to say the IIs who bought shares in the 20s and 30s will be happy with 15. I think and hope not. Green and the BOD hopefully will want more.

All interesting conjecture....HALO has a $7 B market cap and earnings of just over $300 mil. The last company they bought out(Antares Pharma) in April of 22 was at a 50% premium.

So if you put a 50% premium on Avid, that would work out to $15 per share plus or minus, or roughly $1 Billion. Now HALO could easily handle this as it would secure production, and with their Enhance technology growth showing no signs of slowing down....would give them increased profits along with the tax benefits that have accrued with Avid's losses.

Certainly seems to make sense.....right? Would the board go along with a $15 buyout? I would think probably....right? Would the institutions go along with a $15 buyout? Again I would say probably....right? That just leaves the retail shareholders who don't really count in this kind of scenario.

So HALO wins big(IMO) and of course Avid management and especially Nick...win really big. Most institutions would do just fine, and of course that would leave we retail shareholders with a 50% premium over the trading range of late.

Like I have said before....I could live with $15 if it happened in the short term, but still believe that if we can hang on a little longer and we start filling up some of this excess capacity, we probably have a good shot at $20 plus in a year or so???

I guess we will see which way this one goes!

400M
20% margin
when 80% full another expansion phase.
Then Buyout

But I think HALO will move before that to secure volume. That's where the $15 came first...