BOPH closed the session at $2.03, or 6.84% up from the previous close on a volume of ten times the average. It seems like the highly optimistic research coverage that the company received last week, and will continue to receive over the next twelve months, was the main reason for BOPH efforts to restore the higher market value.
The independent analyst, who will be providing the coverage, has been compensated with $8,500 by the company to prepare an extensive and profound research report and he sees a target price of $6.45 for a share of the company’s stock at the end of his coverage period.
Two days before the research was initiated, BOPH made another positive announcement, concerning the expansion of the its product portfolio of Traditional Chinese Medicine offers. As the company has already increasing sales and the business looks profitable, the effects of the preceding dilution news from last months seemed offset.
In the middle of August, BOPH filed a prospectus with the SEC, in which the company declared the sale of up to a total of 20,322,529 shares of its common stock. Part of these shares are issued in connection with the shares exchange transaction from this January, through which the former shell company acquired its current business. The other part of the shares are issuable upon conversion of notes, exercise of warrant, or were already issued in a private placement.
The dilution did not seem to be such a problem, because the additional shares may improve the liquidity of the company’s shares. Currently, not counting the new shares, BOPH has 16.5 million common shares, the biggest part of which held by the management. As it seems, a minor portion of the shares are being freely traded. One more positive side is that the exercise of the warrants issued in connection with the private placement from January may bring in $14.4 million in additional funds for the company.
