3SOF

Quote from: la-onda on November 29, 2005, 03:40:07 AM
afterhours down 
ViroPharma to Offer 7M Shares of Stock
Monday November 28, 5:07 pm ET 
ViroPharma Plans to Offer 7 Million Shares of Its Common Stock in Public Offering


EXTON, Pa. (AP) -- Drug developer ViroPharma Inc. said Monday it plans to offer 7 million shares of its common stock in a public offering.
The company also said it intends to grant the underwriters a 30-day option to purchase up to an additional 1 million shares, and will use proceeds from the offering for working capital and general corporate purposes. The company may also use a portion of the proceeds to repay its debt and for business development purposes.

Shares of ViroPharma fell 89 cents, or 5.2 percent, to $16.11 in aftermarket activity, after closing down 73 cents, or 4 percent at $17 on the Nasdaq.

Real-Time ECN Get Real-Time ECN for: 
VIROPHARMA INC (RT-ECN)   
Symbol: VPHM
Last Trade: 15.64 Nov 28
After Hours Change:  1.36 (8.00%)
Today's Change:  2.09 (11.79%)
Bid: 15.52
Ask: 15.63


comments are appreciated

from yahoo board:
Re: finally MMM confirmed?!?
by: sztabzyb2001
Long-Term Sentiment: Strong Buy  11/29/05 04:48 am
Msg: 74472 of 74473

No, manipulation before secondaruies and private placements is usually down. Only the company itself, VPHM, should want a higher price. Puzzles me why they did it this way. They should have done all the paperwork internally and called a few close knit firms like Jaffray when the stock was over $20 and seen if they were willing to take millions of shares at say a $3 discount - then just anounced one morning they completed a private placement for 7 million shares at say $17 or $18. Hell, I seen some small bios like AVN recently even do a private placement without an underwriter - they just had a lawyer draw up the proper papers and privatelky shopped the issue around without going public until they blew out all the shares at once one morning.

Here's what often happens with secondaries and even private placements that are shopped around too long. Let's use the 7 million shares # for this. Many know about it before the news goes public. In this case, Jaffray and the two co managers plus any firms they have been shopping it too - plus anyone such employees told others. When word leaks out, many will sell their shares not wanting to be caught in a lower priced secondary as such issues are always at a discount to market. So such parties are dumping.

Would a Jaffray who was pumping VPHM at $20 continue recommending VPHM knowing a secondary was on the way? Tell you the truth, I am not sure legally they could even if they thought it was way undervalued. Think at that point they are blacked out, but someone needs to confirm this, from recommending the stock to their clients. Probably on a company "restricted list". If you ever mention a stock to your broker, especially one you know their firm was covering, and they suddenly say "I cannot talk about it - it's on the restricted list" that means news is about to hit. Oh, it could be good news like a takeover for a premium or bad news like a secondary. Odds are greater than 50-50 for bad news if the price recently has been dropping!

So what do we have? Some retail and funds who know in advance who sell as fast as they can figuring they can buy back at the lower price later. You then got firms who may stop recommending their clients to buy the stock - at least short term until the secondary is over. Then you get the voltures - the hedge funds and even the future purchasers of the 7 million shares. If the stock is say $21 and you get a phone call from say Jaffray or Cowen asking you if your firm wouild like to buy say 1 or 2 million shares at a future discount to market in a secondary, wouldn't you want to buy those shares as cheap as possible? Wouldn't you consider shorting the stock knowing word will spread and then the discount issue - so the price has to drop? Literally you could even go out and short say 1 million shares between $20 and $17 and then and then the morning of the secondary buy the 1 million shares in the secondary at say $15 - washing the two positions and pocketing say the $3-$5 difference from the short price to the buy price.

Re: finally MMM confirmed?!? -Continued
by: sztabzyb2001
Long-Term Sentiment: Strong Buy  11/29/05 04:49 am
Msg: 74473 of 74473

I've seen so many secondaries and private placements. Price usually goes down before by those who know due to a combination of non recommended or less recommended buying, shorting, and just plain dumping. The risk to those dumping and shorting is if the company announces good news before the actual secondary date. Oh, they may be legally limited in what they can say before but say in this case, perhaps they could report a business change like a price increase if it were to happen. Anyone know the precise SEC rules on this?

Sometimes the price drops so much it is obvious to the company word has leaked and the price is being manipulated down. Perhaps the company felt legally compeleld to go public with the news yesterday after the big drop during the day. Hell, if the price goes too low they could even call off the secondary.

Often secondaries and private placements are priced at a 10-25% discount to market the night before but I have seen cases where the price correction/crash was so steep beforehand that the price actually bumped up a little thefew days before and then were priucxed at the closing price right before. Why would XYZ Companies purchase 7 million shares at a closing price? Because if they tried to buy that many in the open market, they would
immediately move the price up.

If many shorted knowing this event, they might not even want to wait for the secondary to be issued to start covering. The purchasers of the secondaries could wait until the issue but other shorts might want to start covering during the panic beforehand. That could be as early as today or tomorrow or, if they feel the lats of the retail panick is first kicking now, they may wait until a day or two before the issue.
The risk is always that the panick is overdone - say to $14 or $13 in oiur case and the company then announces the secondary is off. Then all those shorts and those who dumped waiting to buy back cheaper are suddenly scrambling to buy - and BOOM the price pops in a short squeeze. Plus the recommended buying kicks back into gear.
I think company management at VPHM bumbled this one and I think firms like Jaffray need to be investigated and scrutinized more by the SEC.
Hey, this is all just my opinion for what it's worth. All other opinions welcomed.

also nice to read:
http://finance.messages.yahoo.com/bbs?.mm=FN&action=m&board=7077380&tid=vphm&sid=7077380&mid=74449
http://finance.messages.yahoo.com/bbs?.mm=FN&action=m&board=7077380&tid=vphm&sid=7077380&mid=74436
http://finance.messages.yahoo.com/bbs?.mm=FN&action=m&board=7077380&tid=vphm&sid=7077380&mid=74383

tuesday will be painful IMO 

Quote from: la-onda on November 29, 2005, 03:41:06 AM
Real-Time ECN Get Real-Time ECN for: 
VIROPHARMA INC (RT-ECN)   
Symbol: VPHM
Last Trade: 15.64 Nov 28 After Hours Change:  1.36 (8.00%)
Today's Change:  2.09 (11.79%)
Bid: 15.52
Ask: 15.63


comments are appreciated

Oliver,

According to your data, VPHM is poised similarly to two weeks ago, when it was called gap down at the open into the 15.44-15.79 horizontal support area.  The low that morning, November 13, was 15.60, then we got a relief rally.

Here's a review of the technical damage done to the chart two weeks ago, prior to the snapback rally to 18.74:

Quote from: Melf Elf on November 16, 2005, 07:02:20 AM
After a spectaular gain of 1,359% off the May low on "higher highs and higher lows," yesterday was the first day that VPHM made a "lower low," printing and closing below the October 13 low of 16.64.

In addition to that, the stock has alot of technical damage on the "bloodletting."

1. The gap down on November 10 put in a Bearish Island Reversal.

2. November 10 also broke below and closed below Trendline 2 (T2) on heavy volume

3. Yesterday, November 15, VPHM made its first "lower low," taking out 16.64 horizontal support

4. Yesterday, November 15, VPHM also broke below Trendline 1, a trendline that goes all the way back to the May low.

Given that kind of damage, VPHM doesn't look finished on the downside, but here's why I think it could bounce near 15.44-15.79:

On the Ichimoku Kinko Hyo chart, the bottom of the Kumo (Cloud) has been flat-lining at 15.545.
Given the powerful uptrend over the past six months, that could offer at least short-term support.

There's some additional support near there, which I'll show you on the chart in the next post.

The snapback rally off that support, to 18.74, was close to a 38.2% Fribonacci retracement of the decline from 24.36 early November high.  (It was 35.8%).  The rally ended at the top of the Ichimoku Kinko Hyo Kumo (Cloud), indicating that, "at a glance," the Kumo (Cloud) now is providing resistance (see chart, next post).

The rally also ended on a Bearish Engulfing Pattern, with volume exceeding that of the prior day.
Yesterday's close puts VPHM back below Trendline 1 (T1).









 

Quote

Quote

Mel Elf,
I really appreciated your TA !! thanks again (& applaud 
tuesday will show us if support @ 15.44 or 15.79 $ will hold.
Personally I am still convinced of VPHM (great product, good pipeline), my entry price is 11.55$; so I am still fine 

But:
It is hurting if you realize that the stock price was @ 24 a few weeks ago.
Probably I have to adjust my trading rules (more stop loss or setting stop losses with more than 80% profit  )

p.s.: check KOMG AH price action 
best regards from snowy Stockholm
yours
OLIVER

Basis the Ichimoku Kinko Hyo chart, we can "see at a glance" that on November 13, VPHM gapped down below the Kumo (Cloud..the vertical lines), then on the ensuing rally, VPHM "chased" the bottom of the Kumo (Cloud).  The rally ended on November 23 at the top of the Kumo (Cloud), which provided resistance.

We've got quite a number of bearish factors in this chart coming off the early November high of 24.36.  VPHM has a chance here to stop acting bearish here, by forming a double bottom in this 15.44-15.79 horizontal support zone, and then taking out the recent high of 18.74.



 

Quote from: la-onda on November 29, 2005, 05:52:55 AM
my entry price is 11.55$; so I am still fine 

Oliver,

You're still in great shape with that nice entry!

Quote
But:
It is hurting if you realize that the stock price was @ 24 a few weeks ago.
Probably I have to adjust my trading rules (more stop loss or setting stop losses with more than 80% profit  )

That's always tough, trying to catch tops. 

A couple of suggestions, retrospectively, using VPHM (hindsight always is 20/20, isn't it?  ).

1. The Bearish Island Reversal was a sign that the stock could be in trouble.  That pattern often signals a big move in the opposite direction.

2. Trendline #2 was a validated trendline (at least 3 hits).  When a stock puts on the booster rockets to the upside, like VPHM did, it's not a bad idea to get out, or at least to take partial profits on a break of that steeper trendline (T2).  It was broken on November 10,  just under $20.

Quotep.s.: check KOMG AH price action 

Wow...35.01 in AH.  Good for you...applause!  As you know, I sold KOMG at the 33.60 target, knowing that I might not be able to get back in.  Looks like I won't.   

That's fine.  "Take profits at targets...take what's given...you won't get hurt taking profits."   

Quotebest regards from snowy Stockholm

yours
OLIVER

best regards from snowy North Pole

yours
MELF ELF 

SEC link with all the facts:
http://xml.10kwizard.com/filing_raw.php?repo=tenk&ipage=3809602#supp61688_7

lots of interesting details, but NO stock price mentioned...

cheers
OLIVER

So now we know more about the big reversal of VPHM (new offering).   

Thanks for your analysis and research Melf Elf and La onda

SEC update:
Form 8-K for VIROPHARMA INC


--------------------------------------------------------------------------------

29-Nov-2005

Regulation FD Disclosure, Other Events

Item 7.01 Regulation FD Disclosure
On November 29, 2005, ViroPharma Incorporated (the "Company") filed a Prospectus Supplement to Registration Statement 333-64482 (the "Prospectus Supplement") which included the Company's current estimate that net product sales of Vancocin will be approximately $160 to $170 million in 2006.


Shares of ViroPharma (VPHM:Nasdaq - commentary - research - Cramer's Take) fell 3% after the company said it plans to sell 7 million shares of stock in a public offering. The company also granted underwriters an option to buy an additional 1.05 million shares to cover over-allotments. The drug developer said it will use proceeds from the sale to fund working capital and general corporate needs. ViroPharma may also use some of the proceeds to repay all or a portion of its 6% convertible notes due March 2007. Shares were down 43 cents to $16.57.

nice summarization from yahoo board:
one more post before bedtime in Bermuda
by: nothingmanman  11/29/05 10:24 pm
Msg: 75140 of 75153

i'm still holding every single share and every option. I'm hoping this whole shing-ding is due to an opportunity that presented itself to management that required them to generate some quick cash. There's deff "something" to this story though, as they DEFF would not have scheduled to be a part of the Lazard conference and then cancel unless they were required to sush. New SEC rules requires them to be silent until 12/1, so we may hear what this is all about this thursday or early next week (as the offering should be finalized by then). I think they were going about business as normal until something came up that required that cash, they did it (the offering), and are now acquiring either a drug or a company. If that's the case and it adds to the bottom line significantly in '06 to the tune of $2+ EPS (total), this should see a hard-core spike.

Their '06 guidance on Vancocin alone of $160-$170M should generate about $1.25 MINIMUM ($160M revenues * 52% net income % for the 3 month period ending 9/30/05 [which should be the norm cuz no other activity occurred and that's at current Vancocin prices, = $83.2M / 66.8M shares = $1.25). That's assuming no more price increases and trials for Mirabavir and HCV for the full year, just like Q3 (i.e. conservative). I'm realisitcally expecting $1.50.

As i said, if a new acquisition gets them to $2+ in '06, you're looking at a 2-drug company that justifies a 30+ PE multiple and EPS of $2+, giving it a fair value at that point of $60+. We REALLY need this to be an acquisition.
And just for shits and giggles, they bought Vancocin for something like $120M and royalties (w/o looking back), and that generated (before any price increases and the increase CDAD cases) $21M in revenues in Q1 (excluding the other $6M in other revenues), and net income of $11M. That means $120M in acquisition costs should equate into about $30-40M or so in net income if they pick a winner, but not necessarily a "Vancocin"-type winner (home run). $30-$40M in income / 66.8M shares = $.44 - $.60 in income. That gets us to the $2+ mark.
Even if they "only" add $20M for the year, that's still $.30. Throw in 1-2 price increase on Vancocin (as piper has estimated a further 65% upside in price), and that'll get you to your $2+ EPS too... Remember, a price increase to Vancocin flows entirely to income (after taxes, at 15% due to their huge NOL & R&D Credits).
I'm betting on an acquisition and i'm betting my $17.50 calls will still be winners...
finally, good night all...

I will not sale any of my shares and I am thinking to increase my VPHM portfolio if there are any buy opportunities around 15$ 

cheers
OLIVER

I just bought back 3000 shares of VPHM. It looks like it may be moving again. Hopefully the secondary offering is done now and the stock can rebound. The 20ma is 18.64 ? It closed after hours at 18.67 and the macd line may be crossing up.

yahoo board quotation:
technical view
by: tom14100 (51/M/KS)
Long-Term Sentiment: Buy    12/03/05 09:03 pm
Msg: 75986 of 75997

V continues improving and with every passing day another technical indicator triggers additional buy signals. On Friday the Chaikin Oscillator pushed higher breaking it's intermediate downtrend line reflecting stronger accumulation. It also broke through the 50EMA and the RSI crossed over the 50% point, again, a show of more strength. The Volume Oscillator is still below zero though and still falling. This is the only short term weakness I am finding, but I think it is just a reflection of uncertainty over the offering & use of funds. How those questions play out, I'm sure most here will agree will determine whether we rocket upwards or get pounded. As for trend signals, the MACD has risen to the signal line and a decent day Monday should push that over triggering another buy signal. The DMI trendline is still negative, but the D+ crossed above the signal line. A couple good days and it should cross above the D- for another buy signal. It is currently sitting on the middle Bollinger Band and again I think a decent day Monday will push it into the upper half also triggering a buy signal. And finally the P&F charts reflect V in demand and at a double top, in an uptrend. $19.00 triggers a new P&F buy signal.
On balance, these bode well for the stock and the odds strongly favor a continuation of the move up. I am very encouraged, but news trumps technicals, so I wait with everyone else for the answer to the million dollar question(s) to be answered. Personally I expect good news (from a long perspective) and have added to my position this past week.

Well Here's the offering price: 
Any Comments

12/06/2005
Dow Jones News Services
(Copyright © 2005 Dow Jones & Company, Inc.)


NEW YORK (Dow Jones)--ViroPharma Inc.'s (VPHM) secondary offering of 9 million shares was priced at $16 each.

The company previously expected to offer 7 million shares.   

Last month, the company said it would grant the underwriters the option to purchase up to an addtional 1.05 million shares.

Goldman Sachs & Co. was sole book-running manager for the offering. Piper Jaffray & Co. was the joint lead manager and SG Cowen & Co. LLC and Lazard Capital Markets LLC were co-managers of the offering.

http://www.amtddj.inlumen.com/bin/djstory?StoryId=Cq5uA0aebqLqWmdG3nte

I am hoping that Goldman Saches is looking for a double from here to pay for their $500K/person bonus. :-)

ViroPharma Prices Public Offering
Wednesday December 7, 7:53 am ET 
ViroPharma Prices Public 9 Million Share Offering at $16.75 Per Share


EXTON, Pa. (AP) -- Drug developer ViroPharma Inc. said Wednesday that it priced its underwritten public offering of 9 million shares at $16.75 apiece, before underwriting discounts and commissions.
ViroPharma has granted the underwriters a 30-day option to purchase up to an added 1.4 million shares.

The company said it plans to use the roughly $142 million in net proceeds from the offering for working capital and general corporate purposes, to repay its debt, or for business development.

Goldman Sachs & Co. acted as the sole book-running manager for the offering. Piper Jaffray & Co. was the joint lead manager and Lazard Capital Markets LLC and SG Cowen & Co. were co-managers.

Shares of ViroPharma slid 21 cents to $17.24 in pre-market activity.