I've tried to find the answer myself, but to no avail. If a company files a SEC Form SB-2, issuing more shares, would that dilute the stock and in turn bring the PPS down?
I was doing DD on KAIH the price gapped from .02 to .03 today, I like what the company does now and plans for the future. Upon further investigation, they filed a SB-2 today 2/03
Is this a bad sign?
P.S. All of you more experienced traders are really great helping people out. I haven't even considered looking for additional message boards. You guys/gals are the BEST!
Posted by Livinonklendathu on :
SB-2 is the Federal form for offerings and sales of securities in which the maximum offering is unlimited. The offering is available to DPO candidates that have no more than $25 million in sales. The SEC review is conducted centrally in Washington and must be filed electronically through EDGAR 3. The offering is considered a full-blown registration and involves a detailed Prospectus. The SB-2 filing requires audited financials, the last fiscal year's balance sheet and the last 2 fiscal year's income statements plus unaudited interim financials.
In digging a little it looks like their O/S has increased from 27.1 million May of 2004 to 33.9 million in November of 2005. They have open S-8 and SB-2's, not a great sign but neither is for a ton of shares. The O/S increase has been around 10% per year. So yes it is diluting, how much it has hurt the PPS is unknown. The PPS from May 2004 to present has gone from .14 to current levels. I don't know enough about the company as to comment on why the decrease. Hope this helps!
Posted by ShadowLurker on :
That helps a lot thank you Livin. Chart looked like it might have bottomed out and is on the way back, but then th eSB-2 concerns me a bit.