Some of you may have seen my post on WSB a while ago, but I am back. This entry looked great considering:
1.TACO Tuesday is tomorrow and that’s good news day
2.The institutional investor buying in at $20 was enough to convince me to go all in again. This time I have twice as many of the same contract. These calls will take me to 400k before EOY as my thesis of POET being at $40 before EOY remains
3.What the market is not currently pricing is the fact that POET just got a fuck Ton of capital and now have the ability to work on either acquisitions or growth. I have a strong feeling that $400 mil is going to be put towards a new factory in the US, especially after the change in domicile. If you saw what happened to AAOI after they announced their new factory being built in the US price.
4. POET is going to start announcing more POs in the next few months. The surge in share price after the last PO explains itself.
5.POET does not require as much revenue as other competitors to become profitable as they are expected to have far higher gross margins. This means that POET could be a much more profitable company than competitors in a shorter period of time so the ramp up time required is not as significant
6. POETs communication with shareholders is getting better. This is extremely important to the market as it will signal that the company is ready to get serious and act as a real company
7.CFO is gone soon which will gain more confidence in the company from retail and institutions. That guy fucked a lot of people over (not me as I got lucky and sold the day before MRVL deal was cancelled)
8. Meaningful Dilutions are complete. The most recent dilution at $21/share signals that the stock is not going to be diluted to the levels that it was when they kept diluting us at $7.25. There’s a higher bar now and that will only help POET in raising funds with a lower effect on our % of ownership.
With all that being said, current macroeconomic factors are slowing the market. I will not be surprised if we drop down to $12/share but that’s something I’m willing to stomach. People are worried rates are going to rise. That sucks for small cap companies! But not POET, because their balance sheet has very little debt. Rates will hardly affect POET’s operations as they are sitting on a boatload of cash financed through equity.
I’ll end off with a Warren Buffett quote: “Wealth is preserved through diversification and wealth is created through concentration”
