TapImmune Inc. (OTCMKTS:TPIV)’s Bounce Didn’t Last
TapImmune Inc. (OTCMKTS:TPIV) had a nice little change of pace when it announced that it has acquired further funding, but unfortunately for its supporters, said turn of events didn’t last very long. Friday saw the ticker slump another 10% and dip towards the $0.50 mark. Why?
Well, to start off, TPIV‘s balance sheets are certainly better than most that can be found on the OTC Markets, and it has demonstrated on numerous occasions that it has no difficulty in funding its operations.
Unfortunately, the longer TPIV operates without profit, the worse its share structure gets. The latest $1.1 million worth of funding that the company secured in order to continue its research meant another 5.5 million shares being issued and potentially entering circulation. A bit of arithmetic shows that the shares were bought at a price of $0.2 a pop, at a time when the company’s share prices were priced between $0.4 and $0.8.
A bit of due diligence reveals that TPIV has issued 23 MILLION out of its 43 million shares currently outstanding between Nov. 17, 2014 and July 17, 2015. That’s more than 100% dilution in 8 months.
Moreover, since TPIV is a developments stage pharmaceutical company, it still has years of research, licensing and various other pre-production procedures before it even starts thinking about revenues and profits.
Long term investors should think very carefully on what this time spent in development will most likely do to TPIV‘s future share structure, while opportunistic traders should be wary of the sudden bursts of volatility and dead cat bounces that the ticker seems especially prone to.
