Q: Hi, after the recent spectacular increase in share price, would you be more inclined to follow the momentum and buy an initial position, or wait for things to stabilize or dip a little bit? Thank you.
5i Research Answer:
This week's two-day gain of 34% is impressive, and was on higher volume. This was more impressive considering the company also announced a $25M financing this week as well. It made a new solid executive hire recently, and last month won an innovation award. BUT.......we now have a $811M company that still has essentially no sales. Its financings (at higher prices) have been impressive, but it is losing money (more losses expected) and cash flow remains negative. Expectations and risks are very high here, and for interested buyers we think waiting is the right move.