- Pulse is scheduled to discuss “Operational Highlights” on a conference call at 4:30 pm today (Tuesday May 8th). In the past I have highlighted such calls which companies used to create very sharp price spikes. There are some obvious new developments emerging at Pulse.
- Over the past year, critical developments with Pulse have now unfolded exactly opposite to what was required in the short theses. These developments now provide very strong support and clues for the near term LONG thesis
- Billionaire Bob Duggan has nearly doubled his position and now owns 35% of Pulse. Duggan continued to buy even as the share price rose to over $28.00 (nearly 40% above current levels).
- Many are unaware that three of the four newly appointed Pulse board members actually came from Duggan’s Pharmacyclics. That background information was included in in the text but not in the table Pulse’s proxy statement. Pharmacyclics was the company which Duggan turned around from a tiny $15 million market cap and sold to AbbVie for $20 BILLION just a few years later. These newly appointed Pulse directors are his lieutenants.
- As Duggan’s lieutenants were installed at Pulse, other directors associated with MDB Capital then stepped down from Pulse’s board. This now frees MDB parties to sell without restrictions. These parties are now massively incentivized to see a near term spike in Pulse. MDB founder Chris Marlett owns 4.8% of Pulse. Certainly large enough to care, yet just small enough to be able to sell (on a spike) without requiring any disclosure.
- Short interest has quietly spiked to the highest level in Pulse’s history, now amounting to 2.1 million shares. Fully 40% of the free float is sold short. Following a recent short report, short interest may actually be even higher.
- Remember: Troubled fundamentals do not always equate to an attractive short trade. With Pulse, I have nothing positive to say about: the fundamentals, the technology or the parties involved. Yet I can see that the stock will soon head sharply higher. Similar to Energous (WATT), near-term triple-digit price spikes are in no way dependent upon near-term commercialization of the technology.
- There are multiple strategic avenues which Duggan could announce now or in the near future. These include alternate FDA approval paths as well as new asset injections. Any of these should be expected to have a significant impact on the share price, which would then be sharply magnified by the 40% short interest and low float.
- Such announcements could happen sooner, later, or never. But starting today there is a series of possible dates on which we could potentially see this happen. Regardless of one’s view of a long position in Pulse, a short position is now downright reckless.
This report is the opinion of the author. The author is LONG PLSE. The author may conduct transactions on various securities mentioned in this report (or on securities of competitors of other comparable companies, securities etc.) within the next 72 hours.