Brainchip does have a very loose share registry due to massive dilution. When the AFR get on to something they are like a dog with a bone. They will keep digging into the background of the company.
What they have written is factual mixed with an opinion. When you haven't been following the company for 5+ years and you read about the option agreement you would straight away think something suspicious going on. Cheap shares to friends etc, etc.
The truth though is that creating the future isn't easy. It takes time and money. Brainchip really are on their last legs as a company. The capital from LDA was a lifeline and when a company is desperate they tend to agree to deals that are less favorable. This doesn't mean the company will fail. This ultimately is dependent on whether any of the NDA's translate to revenue. To put it bluntly, if they do not translate to revenue within the next 12 months then the company would probably get sold off for pennies on the dollar.
The technology is exceptional but unfortunately exceptional technology doesn't always equal a successful business. Execution from here is paramount. Anything that had happened before doesn't really matter. If revenue comes flowing in and is growing at a fast rate then the share price will grow with it.
In regards to the blown out shares on issue. Share buy backs happen often and have been used successfully by companies such as Apple to help it achieve a trillion dollar market cap. The number of shares on issue today may not be the number of shares on issue in 5 years time. This takes capital to pull off so Brainchip will need to make a lot of it.
Not financial advice. Please dyor.
BRN Price at posting:
34.3¢ Sentiment: Buy Disclosure: Held
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