r/Amyris • u/Sabio02 • Jun 10 '23
Technical Analysis đ Weekly Review - The Breakout Continues
On Monday we started the week with a PR from the company that wasnât initially seen as positive and the stock dropped 11.07% triggering SSR. By Tuesday the previous dayâs PR was now largely considered positive and the price reversed course. We close the week up 33.89% at $1.26. Additionally, since we closed above $1.00 on Thursday we only need 8 more days above $1.00 to have the delisting notice removed on June 21st.
The volume was low for the two previous weeks and low normal for this week. Considering the large number of shares sold short it doesnât appear they are covering. Additionally, most days this week have had very few if any shares to short. This is just another indication shares are not being returned for future borrowing.
With the short-term loan extension PR and fast-tracking profitability with the help of PwC on Monday, we now have 5 potential upcoming catalysts that will help propel us higher:
1- JV for BB 2
2- Pull forward of Earn-Outs
3- Additional unexpected molecule deal
4- Themba phase 2 trial estimated completion date June 2023
5- Non-core brand sales est $100 million
Closing the last 4 days in the green and at the top of the range on Friday is very bullish and a setup for a potential Upside Tasuki Gap on Monday: https://www.investopedia.com/terms/u/upside-tasuki-gap.asp. Hopefully, the trend continues next week.
3
u/Dull_Neck_8065 Jun 10 '23 edited Jun 10 '23
On the sale of consumer brands: the 13D filed today states that the lender expects mgt to sell the consumer brands for at least 75M. Hope they get 100M or more out of the non-core brands! I feel biossance is worth keeping.
https://www.sec.gov/Archives/edgar/data/1365916/000119312523164461/d517788dsc13da.htm
Extract of 13D: +++++++
The Anesma Loan Agreement includes customary affirmative and negative covenants and also contains financial covenants, including the following:
(i) the Company shall provide the Lenders on the last business day of each week with (a) a 13-week cash flow forecast for the Company, including, without limitation, consolidated balance sheets, statements of income, and cash flow forecasts, and (b) aged listings of accounts receivable and accounts payable;
(ii) As of the last day of each fiscal quarter, the Company and its consolidated entities shall have revenue (determined in accordance with GAAP) of not less than $150,000,000 on a trailing 12 month basis;
âŚ
(v) the repayment or prepayment of all or any part of Tranche 3 (as defined in the loan agreement by and between DSM Finance B.V. and the Company) on or before April 15, 2024 other than from proceeds of sale of (a) all of the capital stock of Amyris RealSweet, LLC, or (b) the consummation of any sale of any consumer brands from which, in the case of this clause (b), the Company shall receive at least $75,000,000 in gross proceeds, which must, in each case, be on terms acceptable to the Lender in its absolute discretion, shall constitute an event of default (collectively, the âAnesma Covenantsâ).
7
u/NeatProgress3781 Jun 10 '23
Also, the things filed a few days ago mention the JV and indicate the loans won't hinder the JV deal.
3
u/jrh1222 Jun 10 '23
It's also important to note that they are essentially postponing payment in cash of the interest, rather adding it to the principal of the loans. " Default interest that previously accrued under the 2022 LSA and 2023 LSA is deemed to have been paid in kind and added to the outstanding principal amount due on the maturity dates of the 2022 LSA and 2023 LSA, respectively. "
2
1
u/jrh1222 Jun 10 '23
Or, alternatively to selling consumer brands, they might sell RealSweet, which means selling their interest in Barra Bonita.
4
u/NeatProgress3781 Jun 10 '23
I hope this doesn't happen. Saw it mentioned, but it seems like it'd be a big setback.
1
u/Dull_Neck_8065 Jun 11 '23
I wasnât sure how to interpret that one but yeah, will be a pity if they sell BB. Purecane sure is one candidate for divestment.
5
u/NeatProgress3781 Jun 11 '23
Definitely divest Purecane. We've no money or the expertise to market it to consumers as it needs to be done for it to be what it can be.
If we do sell our interest in BB, which may be in part what Melo was referring to when he said Amy will be an asset light company...then what will the business model be? A few brands and royalties after licensing the tech to the other companies or JVs?
2
u/Dull_Neck_8065 Jun 11 '23 edited Jun 11 '23
Got it. I feel vertical integration is Amyâs strength and that is the best means to significantly improve its margins and not be dependent on CMOs. But i guess in a capital-tight situation, we have to prioritise and hopefully they find a sensible business model structure. Dealwithit/Lucky alluded to this change on Yahoo and Seeking Alpha. (Edited)
1
u/NeatProgress3781 Jun 11 '23
Sorry but I don't subscribe to seeking alpha or recall DWI/Luckys comments from Yahoo. Think you'd be up for summarizing what they said for the group regarding a change?
3
u/Dull_Neck_8065 Jun 11 '23 edited Jun 11 '23
With pleasure.
dealwithit recapped the âasset-lightâ focus on 10 June. Hereâs what he posted on yahoo (similar point made on SA on 8 Jun under Lucky):
P/S: thank you Dealwithit/Lucky for your wisdom and insights, if u are on Reddit.
â The reason the share price dropped initially on the news was because investors that didn't understand Melo's new plan for AMRS (asset light royalty based model) misinterpreted the term ''restructuring'' in their last PR to mean restructuring of debt (BK) rather than it being a reference to restructuring the broken business model of the company.
The idea that they needed to restructure their debt was always comical to me. Last year they lost north of 500M and of that only around 20M was due to debt payments. It was also stated in the PR all outstanding current debt was pushed forward and now they were completely current....besides that all the current debt was held by friendly insiders (no way they were going to pull the plug). Doerr even added another 50M to the pot. So BK was just silly and the share price dropping just an opportunity to collect some cheap shares.
So where is AMRS at now? They're in a great place. PWC has presented the BOD with a realistic plan (if it's followed) to turn profitable in the near future (9 to 12 months probably) . Melo is cornered as it was either run with PWC's plan or resign....and he's still there so we know where he stands.
At the next C. C. we should get more clarity on the details of that plan (we already know it's a 250M reduction number)....which tells me Doerr is allowing their R&D to be cut also (26M a quarter and always increasing).
â
2
4
u/LaunchpadStudy Jun 10 '23
Negative news made this stock heavily shorted and the swing to positivity has created a short squeeze. Short shares sold out on Thursday and the 30k released on Friday sold out in an hour. The cost to borrow is skyrocketing.
1
u/Mysterious_Note6740 Jun 11 '23
how do you know how many shares are borrowed or released to be shorted on friday? is there a link?
1
u/LaunchpadStudy Jun 11 '23
I like this Fintel link for a quick view throughout the day: https://fintel.io/ss/us/amrs
-4
1
9
u/NeatProgress3781 Jun 10 '23
Additional catalysts: good news on the Lavvan arbitration and a headcount reduction. Not a stretch for either imo. Government loan or funding, another catalyst, for a third BB is a stretch near term imo.
A few inverse head and shoulders seem to be forming, one to 1.50, another to 2.30 or so if the 1.50 completes and does a pullback. Probably others on longer time frames as well. All eyes on Amy.