Actually, the math works even MORE in your favor than you think, when:
1) you have the reverse of dilution: shares cancelled / returned to treasury
- or -
2) you buy a stock that's undervalued (or say it's depressed by x% from its market value) and returns to it's market value
Check this out: 1/3 reduction (-33%) in shares issued = 50% increase in value of the remaining shares issued.
In the first case, say there are a total of 1,000,000 shares issued (O/S) and the pps = $1. The market capitalization is $1,000,000 (and so let's just say the market value of the company is therefore $1,000,000).
Company retires 1/3, or 333,333 shares, but nothing else changes, nothing has changed the value of the company - the market value/capitalization of the company is still $1,000,000. Well then, what's the pps (market value in terms of price per share)? The pps = Market Cap divided by total outstanding shares = $1,000,000 / 666,666 shares = $1.5 per share (pps).
So... for the first case above, cancelling 1/3 of the O/S results in a 50% increase in pps value.
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In the second case, say the current pps is 33% lower than what it really should be - perhaps you see that the current pps is $0.66 and it used to be trading at $1.00 but it dropped because a basher posted an article full of lies... and you expect it to pop back up to $1.00 next week when shareholders learn that it was all just a lie.
If you buy the stock at $0.66, when the pps reaches $1.00, you will have made a $0.33 gain, which is 0.33/0.66 = 50% gain.
So... buying a 30% dip will get you a 50% gain if/when the pps returns to its original/normal value.
___________________________________________
Hmmm, let's see. ONCI peaked out at something like 0.0192 last September (2017), I think. But that was waaaayyyy before we achieved ~$5M in annual revenue with something like $2M profit. And waaaayyyy before something like $2M in debt was wiped from the balance sheet (over the first 9 months of 2018). And we're just starting to build momentum in the market with numerous dealerships online for the BsafeMobile product including 20-30 AutoNation locations and CarMax coming into the mix at some point recently or soon, several FleetSafer customers now online and more to come with the first Private Label insurance company distributing the product and another larger, high-profile Private Label customer getting ready to begin a multimedia marketing/advertising blitz, as well as our own recent, successful consumer-facing social media marketing launch on Facebook.
Earlier this week you could buy ONCI stock at ~0.00192 - a 90% depression from last September's peak...
...and we have all of these fundamental business advancements building pressure to where our marketing engine is beginning to bulge at the seams, ready to explode...
...and then we have the Delaware tax issue being resolved NEXT WEEK that has several business developmental corporate actions pending execution behind it, including O/S reduction by ~30% ( = automatic/immediate ~50% value boost to common shares).
Hmmm, I wonder if ONCI is a good buy anywhere under a penny or two? Don't wonder too long, folks. Some have been wondering (or wandering) off and on all year, and now's about time for decisive action. It might just be time for an EOD Friday rally to lead into relatively heavy ONCI Holiday trading for the next 2 weeks.
1) you have the reverse of dilution: shares cancelled / returned to treasury
- or -
2) you buy a stock that's undervalued (or say it's depressed by x% from its market value) and returns to it's market value
Quote:Theoretically, a 30% reduction in shares should cause a 30% appreciation in PPS - all other things held constant.
Read More: https://investorshangout.com/post/view?id=529...z5aLiaSOs3
Check this out: 1/3 reduction (-33%) in shares issued = 50% increase in value of the remaining shares issued.
In the first case, say there are a total of 1,000,000 shares issued (O/S) and the pps = $1. The market capitalization is $1,000,000 (and so let's just say the market value of the company is therefore $1,000,000).
Company retires 1/3, or 333,333 shares, but nothing else changes, nothing has changed the value of the company - the market value/capitalization of the company is still $1,000,000. Well then, what's the pps (market value in terms of price per share)? The pps = Market Cap divided by total outstanding shares = $1,000,000 / 666,666 shares = $1.5 per share (pps).
So... for the first case above, cancelling 1/3 of the O/S results in a 50% increase in pps value.
___________________________________________
In the second case, say the current pps is 33% lower than what it really should be - perhaps you see that the current pps is $0.66 and it used to be trading at $1.00 but it dropped because a basher posted an article full of lies... and you expect it to pop back up to $1.00 next week when shareholders learn that it was all just a lie.
If you buy the stock at $0.66, when the pps reaches $1.00, you will have made a $0.33 gain, which is 0.33/0.66 = 50% gain.
So... buying a 30% dip will get you a 50% gain if/when the pps returns to its original/normal value.
___________________________________________
Hmmm, let's see. ONCI peaked out at something like 0.0192 last September (2017), I think. But that was waaaayyyy before we achieved ~$5M in annual revenue with something like $2M profit. And waaaayyyy before something like $2M in debt was wiped from the balance sheet (over the first 9 months of 2018). And we're just starting to build momentum in the market with numerous dealerships online for the BsafeMobile product including 20-30 AutoNation locations and CarMax coming into the mix at some point recently or soon, several FleetSafer customers now online and more to come with the first Private Label insurance company distributing the product and another larger, high-profile Private Label customer getting ready to begin a multimedia marketing/advertising blitz, as well as our own recent, successful consumer-facing social media marketing launch on Facebook.
Earlier this week you could buy ONCI stock at ~0.00192 - a 90% depression from last September's peak...
...and we have all of these fundamental business advancements building pressure to where our marketing engine is beginning to bulge at the seams, ready to explode...
...and then we have the Delaware tax issue being resolved NEXT WEEK that has several business developmental corporate actions pending execution behind it, including O/S reduction by ~30% ( = automatic/immediate ~50% value boost to common shares).
Hmmm, I wonder if ONCI is a good buy anywhere under a penny or two? Don't wonder too long, folks. Some have been wondering (or wandering) off and on all year, and now's about time for decisive action. It might just be time for an EOD Friday rally to lead into relatively heavy ONCI Holiday trading for the next 2 weeks.
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