HDR hardman resources limited

HDRWMB are they expensive

  1. 1,047 Posts.
    I've just started to look at the Macquarie warrants.

    Using and a Black-Scholes Pricing Analysis, with a volatility of about 60% (a bit above what HDR is now), and I note that the fair value of the warrant is around 10.5-11c.

    Only thing is thats with a 1 for 1 conversion.

    Since its a 2 for 1 conversion; the fair value of the warrant should be about 1/2 this (i.e 5.5 cents).

    Earlier people noted that on the current price you need a price for the fully paids to be above $1.14 to break even.

    From what I can tell this is an all or nothing play, and McQuarie are putting a large premium on the warrants.

    If I have done my calculations wrong can some one please correct.
 
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