Author Topic: MDXG - MiMedx Group  (Read 3055 times)

Gregmal

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Re: MDXG - MiMedx Group
« Reply #10 on: November 19, 2018, 01:16:28 PM »
Pretty easy. Classic sentiment trade.

As I've said before, returns are everywhere, just gotta find them.


John Hjorth

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Re: MDXG - MiMedx Group
« Reply #11 on: November 30, 2018, 01:02:41 PM »
”In the race of excellence … there is no finish line.”
-HH Sheikh Mohammed Bin Rashid Al Maktoum, Vice President and Prime Minister of the United Arab Emirates and Ruler of Dubai

TBW

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Re: MDXG - MiMedx Group
« Reply #12 on: December 05, 2018, 11:07:47 AM »
Gregmal,

Was your trade here just that it was oversold and had to pop, and if it did pop it would be substantial given short interest? 

It is well known that even terminal companies can bounce numerous times, by more than 100%, on the path to 0.  While I know that, I never can bring myself to even attempt to trade it.  But power to you if you can.

The news from the company today was awful.  The auditor that was supposed to help the company restate the past 6 years quit, amongst 24% of the staff being fired, etc..  Honest question, How in the world does a company like this ever get out financials?    They have now had 2 of the big 4 quit.  They still have to review the past 6 years of financials.  Who is left to do that for them?  Who can accept that liability, knowing the mess you are getting into?  And finally, who knows if that can afford such an audit?  Really interesting to watch this all play out.

alwaysdrawing

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Re: MDXG - MiMedx Group
« Reply #13 on: December 05, 2018, 11:22:40 AM »
https://mimedx.gcs-web.com/news-releases/news-release-details/mimedx-announces-resignation-outside-auditor

Quote
MARIETTA, Ga., Dec. 5, 2018 /PRNewswire/ -- MiMedx Group, Inc. (OTC PINK: MDXG), a leading developer and marketer of regenerative and therapeutic biologics, today announced that on December 4, 2018, Ernst & Young LLP informed the Company's Audit Committee that it has resigned from the engagement to audit the Company's financial statements for the years ended December 31, 2017 and 2018, effective immediately. Additional information about Ernst & Young LLP's resignation will be included in a Form 8-K to be filed with the SEC no later than December 11, 2018.

https://mimedx.gcs-web.com/news-releases/news-release-details/mimedx-announces-organizational-realignment-program

Quote
The realignment will include a reduction of the MiMedx workforce by approximately 240 full-time employees, or 24% of its total workforce, of which about half are salesforce personnel.

Quote
As previously announced, the Company is restating its financial statements. Due to the depth, breadth and complexity of issues identified, management has expanded the scope of work in connection with the preparation of the Company's financial statements and is unable to estimate the expected completion date at this time. 

Due to the changes in business practices discussed above and other factors, including the inability to provide the full context of current or past performance, the Company is not currently in a position to provide any financial performance-related information.  Moreover, at this time, the Company cannot estimate its exposure, if any, to potential contingent liabilities related to pending and threatened shareholder lawsuits, pending governmental investigations or other legal proceedings.

As previously disclosed, the Compensation Committee and the Board determined that the separations of the Company's former CEO, COO, CFO and Corporate Controller should be treated as "for cause" and that these former executive officers had engaged in, among other things, conduct detrimental to the business or reputation of the Company.  The departures of these former executives have enabled the Company to progress in the preparation of its financial statements. 

The Audit Committee's independent investigation is still ongoing, and there may be other actions taken based, at least in part, on information from the investigation. The Company continues to incur significant legal and accounting-related expenses related to, among other things, the Audit Committee's independent investigation and other legal matters, the Company's work to prepare its restated financial statements and the implementation of improved business controls.

Separately, the Board of Directors' search process for a permanent CEO is active and ongoing, and the Board has been meeting with candidates. However, the ongoing investigation, resulting extensive accounting analysis and pending financial restatement process make it challenging to attract qualified candidates. In addition, the financial restatement process has presented a practical issue with respect to candidates having sufficient information to evaluate the Company's financial situation and overall business.

The end is near here.

Gregmal

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Re: MDXG - MiMedx Group
« Reply #14 on: December 05, 2018, 11:57:09 AM »
Gregmal,

Was your trade here just that it was oversold and had to pop, and if it did pop it would be substantial given short interest? 

It is well known that even terminal companies can bounce numerous times, by more than 100%, on the path to 0.  While I know that, I never can bring myself to even attempt to trade it.  But power to you if you can.

The news from the company today was awful.  The auditor that was supposed to help the company restate the past 6 years quit, amongst 24% of the staff being fired, etc..  Honest question, How in the world does a company like this ever get out financials?    They have now had 2 of the big 4 quit.  They still have to review the past 6 years of financials.  Who is left to do that for them?  Who can accept that liability, knowing the mess you are getting into?  And finally, who knows if that can afford such an audit?  Really interesting to watch this all play out.

To me at least, it just seemed that at that given point, you had a pendulum swing that more or less stuffed so much negative into such a short time frame, that simply no news would swing things back to the middle. These events, all occurring in rapid succession, plus what to me seems to be at least to the plausibility that the business could be real, made this kind of an easy opportunity. With a 2 day bounce of around 60% that proved to be the case. So definitely more lucky than good, but finding setups like this, where there are multiple ways to win, is something that I have found sensible and profitable.

A few years back Deutsche got walloped and there was a big overreact, just waiting for the pendulum to swing back again worked out. This one is stickier but if you manage your allocations there is nothing wrong with speculating. Worst case is always zero. No big deal.

Gregmal

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Re: MDXG - MiMedx Group
« Reply #15 on: December 06, 2018, 11:09:01 AM »
Well, I like to live dangerously so I got in here again at 1.25 with a very, very tiny position.

For records sake, I do not think this situation at all resembles the one I started the thread with. Yesterday's announcement is single and specific, rather than the multi-pronged clusterfuck that happened in early November. So from here I expect it to just kind of float. No massive snap back. But I do think this has to be the last shoe to drop before we get finality.

The audit will take time, but EY was only doing 17+18. They'll need to be replaced although there is definitely a good chance they don't even end up releasing anything. All in all, the audit IMO is make or break and will probably cost 10-20M. I expect a good chunk to be off-set by FCF but essentially, I think the big risk is the shareholder lawsuits. Those I can't see being resolved until both the audits and the criminal investigations take place. I don't think the gov puts this company away, and if the restated financials are not atrocious, this thing flies and I would assume the capital markets open up as an option to fund any future payouts.

Whereas, any positives, even finding a new CEO or at this point even a little short covering I think get you a good hop.

At the same time there are plenty of high quality companies available, at very cheap prices, so I kind of ask myself WTF I'm doing here with this. But it's only 15 basis points so let's roll the dice.

alwaysdrawing

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Re: MDXG - MiMedx Group
« Reply #16 on: December 06, 2018, 11:12:27 AM »
Well, I like to live dangerously so I got in here again at 1.25 with a very, very tiny position.

For records sake, I do not think this situation at all resembles the one I started the thread with. Yesterday's announcement is single and specific, rather than the multi-pronged clusterfuck that happened in early November. So from here I expect it to just kind of float. No massive snap back. But I do think this has to be the last shoe to drop before we get finality.

The audit will take time, but EY was only doing 17+18. They'll need to be replaced although there is definitely a good chance they don't even end up releasing anything. All in all, the audit IMO is make or break and will probably cost 10-20M. I expect a good chunk to be off-set by FCF but essentially, I think the big risk is the shareholder lawsuits. Those I can't see being resolved until both the audits and the criminal investigations take place. I don't think the gov puts this company away, and if the restated financials are not atrocious, this thing flies and I would assume the capital markets open up as an option to fund any future payouts.

Whereas, any positives, even finding a new CEO or at this point even a little short covering I think get you a good hop.

At the same time there are plenty of high quality companies available, at very cheap prices, so I kind of ask myself WTF I'm doing here with this. But it's only 15 basis points so let's roll the dice.

cc:  Bagholder Quotes

Gregmal

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Re: MDXG - MiMedx Group
« Reply #17 on: December 06, 2018, 11:16:25 AM »
Well, I like to live dangerously so I got in here again at 1.25 with a very, very tiny position.

For records sake, I do not think this situation at all resembles the one I started the thread with. Yesterday's announcement is single and specific, rather than the multi-pronged clusterfuck that happened in early November. So from here I expect it to just kind of float. No massive snap back. But I do think this has to be the last shoe to drop before we get finality.

The audit will take time, but EY was only doing 17+18. They'll need to be replaced although there is definitely a good chance they don't even end up releasing anything. All in all, the audit IMO is make or break and will probably cost 10-20M. I expect a good chunk to be off-set by FCF but essentially, I think the big risk is the shareholder lawsuits. Those I can't see being resolved until both the audits and the criminal investigations take place. I don't think the gov puts this company away, and if the restated financials are not atrocious, this thing flies and I would assume the capital markets open up as an option to fund any future payouts.

Whereas, any positives, even finding a new CEO or at this point even a little short covering I think get you a good hop.

At the same time there are plenty of high quality companies available, at very cheap prices, so I kind of ask myself WTF I'm doing here with this. But it's only 15 basis points so let's roll the dice.

cc:  Bagholder Quotes

Well, I nailed it once, so I'm probably a little more eager to try it again. Oh well.

alwaysdrawing

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Re: MDXG - MiMedx Group
« Reply #18 on: December 06, 2018, 11:21:09 AM »
Well, I nailed it once, so I'm probably a little more eager to try it again. Oh well.

Daytrading fraudulent pink sheets stocks is not the way I would try to compound wealth.  The stock popped and you were "right" but it's down a lot since then, and will continue to go lower.

Good luck on your trade.

Gregmal

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Re: MDXG - MiMedx Group
« Reply #19 on: December 06, 2018, 11:31:03 AM »
Well, I nailed it once, so I'm probably a little more eager to try it again. Oh well.

Daytrading fraudulent pink sheets stocks is not the way I would try to compound wealth.  The stock popped and you were "right" but it's down a lot since then, and will continue to go lower.

Good luck on your trade.

I don't disagree. Trading has just as much to do with sentiment and probability as it does with the actually vehicle. See SharperDinegaan's BTC trading last year. You can flip a bag of shit if the entry is right and you have your target in site.

I won't lie though, my core positions are concentrated, and boring... so there a little bit of an entertainment value here for me too. I'm aware of all the traditional value investor no-no's I'm doing, but its my money, it's an irrelevant amount, and to be fair, the way a lot of great investors have spent trying to compound wealth, ie sitting on huge piles of cash for the past decade, hasn't exactly been a winning strategy either.