Maxcyte Share Discussion Threads

[thetrotsky] 06/9/2021 13:03

It's Labor Day in the US, so we're "all on our own" today

[assagai] 03/9/2021 21:59

190k after hours sell. So 2million squids worth moved into new hands. Nice base.

[pob69] 02/9/2021 15:20

Philip Rodrigs, manager of Raynar Flagship fund, explains why he invests in life sciences company MaxCyte (MXCT).

[assagai] 02/9/2021 12:41

Thanks Pob69, a week earlier than anticipated.

Well its on my NAS monitor but not UK?

[pob69] 02/9/2021 12:17

Hasn't been RNSed but Q2 out on 13/9

[apad] 02/9/2021 07:35

Filtering is not enough for me, multibagger. Although I hope you stay on 😊

I've removed MXCT from my favourites list. Pity, but look at the other boards that have been destroyed by trolls and folks feeding them. BOO is a good current example.
I suspect that a lot of (mostly) lurkers disappear too.

Such a shame.

apad

[thetrotsky] 02/9/2021 07:08

T5, Stop being a numpty yourself. The Investopedia definition is misleading. A company's share price at any given time is generally accepted to represent the market's notional estimate of its discounted future earnings (the present value of future cash flows; generally, but not always, less than the actual cash flows) plus the market value (or cash value if you prefer) of its net assets as at that date. I would accept that, in principle, my share of the company's discounted future earnings has (potentially) been reduced by the new share issue but the company's net assets have been enhanced (by the additional cash) and, because the new shares were issued at a premium, the new investors have effectively (more than) compensated me for the expected reduction in my share of the discounted future earnings. As I've already said, a new share issue at a (significant) premium is extremely rare in my experience. Furthermore, I say "potentially" because although the new investment may not change the company's expected future earnings it may have accelerated them, with a consequential knock on effect that the company's discounted future earnings may well have increased. It's all in the maths.

[multibagger] 02/9/2021 06:09

Good morning Nimbo1 and Assagai,

I have added another to the "filtered" crew now....best to leave them to their style of investing.

[assagai] 01/9/2021 22:03

So proud mum and dad go to Johnny's passing out parade. The band strikes up, the cadets go by the left, quick march. Mum turns to Dad in horror and exclaims. "I don't believe it , just look at that, every single one of them is marching out of step......except our little Johnny of course.

[trident5] 01/9/2021 21:40

For the numpties:

[thetrotsky] 01/9/2021 20:58

Nimbo1, You clearly don't know what you are talking about. Control trumps cash every time didn't you know ;-) I was watching a program last night about 9/11 and this newsman was talking about how we'd inadvertently witnessed first hand the plane, circle and crash into the Pentagon. He'd been trying to get into Manhattan to report on the Twin Towers and had pulled off the highway in frustration because of all the queues and traffic jams and just happened to park up near the Pentagon before it was hit. A number of years later he invited a conspiracy theorist to his house for a meal and explained to him what he'd seen and the conspiracy theorist, who hadn't been anywhere near the Pentagon at the time of the attack, turned to him and, without batting an eyelid, said that, when in shock, the mind plays games and creates false memories (or words to that effect)! The newsman knew perfectly well what he saw and this guy was telling him he was wrong because it just didn't fit with his consporacy theory. A bit like my "mate" Trident5 perhaps ;-)

[thetrotsky] 01/9/2021 20:45

"Mate", you can take a horse to water but you can't make it drink. The maths speaks for itself but ignore it as you please. The company is signifiicantly more valuable since the fund raising but you stick to your dilution hypothesis if that what pleases you. I'd explain discounted cash flows and how companies are valued but it would clearly fall on deaf ears. I suggest that you divest now, if you haven't already done so, and all your dilemmas and worries will be resolved. Ta ta. Bye bye

[assagai] 01/9/2021 20:10

Hi Nimbo, me too! It's certainly been my star performer over the last year or so. Very happy with the upgrade that came for free with the NAS placing.

[nimbo1] 01/9/2021 20:06

Back in the real world where paper money becomes real anyone who has owned this share for 18 months isn't worried about dilution. Maxcyte has made me a few pennies despite the 3 rounds of dilution - wish all my holdings would raise some cash. The dilution was essential to reach a higher valuation by enabling the large US funds to get decent sized positions.

[assagai] 01/9/2021 19:05

Ho ho hum, it's great being glum.....

If you are so worried about owning a smaller % of the company, the solution is simple.....buy more shares....

[trident5] 01/9/2021 18:34

Mate - you are diluted if the company you own shares in issues more and you don't participate, your call on a portion of future profits is less than it was pre-issue.

[thetrotsky] 01/9/2021 17:40

Cooltools, there is absolutely no doubt that the company had to raise money in February to "stay afloat" as you put it; it's current income does not cover it's current expenses (it's "burning cash"). However, as far as I am concerned, the key point to note here (something that both you and Trident5 appear to have ignored) is that the new share issue was done at a (significant) premium to the share price immediately before the the share issue was announced. Now, maybe it's a refelction of the calibre of company I normally invest in or just that I've led a sheltered life, but in all the 25 years+ I've been investing I've never, ever, seen a new share issue done at a premium to the share price immediately before the announcement. How often have you seen a share price edge up steadily for weeks/months and then, wham, out of a clear blue sky the company announces a fund raising and all those previous gains evaporated (or seriously diminished). This has been entirely different; the new investors felt MXCT was undervalued and that there was still significant upside to come. Whether the company's business plan comes to fruition remains to be seen, but at present, the new US institutional investors think this company is the up and coming kid on the block.

[thetrotsky] 01/9/2021 17:21

Apologies. I made a typo. I said "Your 10k shares are now worth £1.05m!" whereas I should have said "Your 100k shares are now worth £1.05m!". I was messing around with the figures so that I could get whole numbers. You could do much the same exercise with the original MXCT figures and the conclusion would be exactly the same; where new shares are issued at a premium to the original market price your existing shares will always theoretically be worth more (assuming the valuation of the company's future expected earnings remains constant and ignoring external factors beyond the comapny's immediate control). I should also make the point that where shares are issued at a discount to the market value, and the existing shareholders aren't allowed to participate, there will, in effect, be a transfer of value to from the existing investors to the new investors. If issuing shares at a premium is a dilution as you claim, I say give me more ;-) I'm always happy to accept free money ;-)

[thetrotsky] 01/9/2021 17:08

T5, As our American cousins are wont to say "Do the math!". For example, if a company has (say) 10m shares in issue and its share price is (say) £10 per share then the company will have a market value of £100m. Let's say that you own 1% of the company then your 100k shares would be worth £1m. Let's now say that the company issues (say) 2m of new shares at £13 per share then, all other things being equal, immediately after the new share issue the company will be worth £126m (the company's original market valuation plus the £26m of new cash raised) but there would now be 12m of shares in issue. So, how much are your 100k shares now worth? I'll save you getting out your calculator. Your 10k shares are now worth £1.05m! You may own a lower % of the shares in issue but the value of your shares has increased. QED there is no dilution! That's why MXCT's share price rose after the first new share issue because the new investors were paying more than the market price before the announcement and there was, in effect, a transfer of value from the new investors to the existing investors. I grant you that this is highly unusual (it was a first in my experience) because most new share issues are done at a discount to the market price before the announcement, not a premium. So, in conclusion, when shares are issued at a discount to the market price there is a dilution BUT when shares are issued at a premium to the market price (as was the case for MXCT) there is am "augmentation" (it so rarely happens I'm not sure there is a financial term for it). The key here is that there has been no dilution in the value of your shares. For most shareholders the fact that their % holding has been reduced is wholly irrelevant (because their interest, alone, is rarely, if ever, sufficient to have any say in how the business is run). You may feel different but for me it's about turning a profit not control that is relevant.

[al101uk] 01/9/2021 16:28

"Your holdings are diluted when shares are issued and you don't participate in the issue. The price is not relevant - your share of the pie has been diminished."

Your share of the pie gets smaller on a percentage basis, but may be bigger in absolute terms. The company don't just give away shares, they get cash in return, which increases the asset size of the company and changes the modelling for future returns.

$100 million company (priced at $1) raises $50 million in cash through a fund raise at $1.

The company isn't still worth $100 million, it now has all the same assets it had before, plus $50 milion. The market should price it at, at least, $150 million. If the company was, for example, highly indebted, the market may take the succesful placing as a sign of a turn around and so revalue the company at a higher price over the short to medium term.

A good company doing a placing can be good for all shareholders, just as a bad company doing a placing can be purely diluting for shareholders as the raised funds are at a discount and likely to be wasted.

[cooltools] 01/9/2021 10:03

Exactly. If an additional 5% of shares are released, the price (all things being equal) should fall by the same to reflect dilution. If it doesn't, then that indicates the market's opinion of the fundraise. Further down could mean e.g. the business is raising money just to stay afloat; up could indicate the market thinks e.g. the capital is needed to expand further and achieve greater things.

[trident5] 31/8/2021 21:48

TT - your holdings are diluted when shares are issued and you don't participate in the issue. The price is not relevant - your share of the pie has been diminished.

[thetrotsky] 31/8/2021 15:26

Trident5, It is a fact that the market value has not been boosted by a dilutive issue of more shares. The first issue, announced after closing on 3 February 2021, was done at £7 whereas the closing price on 3 February 2021 was £6.65; hardly dilutive. As regards the second, more recent, listing there was a lot of speculation as to what the listing price on NASDAQ might be and, as a result, there was a lot of "froth" between the confirmation of the dual listing, announced before opening on 14 May 2001, and the announcement of the NASDAQ listing price before opening on 30 July 2001. The closing price on 13 May 2001 was £9 whereas the listing price was ~£9.35 ($13); so again hardly dilutive. I appreciate that in-between the share price reached in excess of £11 (it closed at £11.35 on 13 July), but that was on the back of a lot of unsubtantiated price speculation by PIs (myself included). As regards, going to the markets twice in quick succession, I would argue that MXCT needed the first to fund its immediate financial requirements and bring onboard the new US institutional investors needed to facilitate the dual listing whereas the second listing was just sufficient to meet NASDAQ listing requirements and institutional demand, and no more (they could have issued upwards of 100m shares but in the end only listed just over 15m). You might argue that they could have tried to forego the first issue but I suspect that without the first listing it would have proved a lot more difficult, if not impossible, to launch the second dual listing on NASDAQ. Whether the dual listing will prove beneficial to UK shareholders still remains to be understood; arguably the share price would not have increased so much in the last year if it wasn't for the higher rating that US investors put on such companies (certainly after the first new issue).

[trident5] 31/8/2021 10:09

N1 - it's not so much an opinion as a fact. You can happily state that the market cap is over a billion, but it's worth putting that in the context of smaller numbers - revenue of under £20m and losses of nearly £9m in the last reported accounts. The market cap has recently been boosted by the dilutive issue of more shares rather than price appreciation.

The market would be the aggregate of individual opinions.

I've done well here but am unnerved about the need to go to the markets for more cash twice in quick succession, the number of clever NEDS and the admission that external advice led them to conclude that they should keep CARMA.