MGT Capital Investments Inc. (NYSEMKT:MGT) Continues To Surge Higher

MGT Capital Investments Inc. (NYSEMKT:MGT) just won't lie down. Our competitors have repeatedly shot down the company's prospects, but every time we suggest that there is further run room, the company jumps double digits.We commented on McAfee's latest bitcoin related update at the end of last week, and suggested that these operations could form a nice revenue stream (and speculative store of wealth) going forward. We also noted that, despite the non-approving of the shares registered by the company with the intention of using them to purchase D-Vasive, MGT would almost certainly find a way to get around the NYSE denial, and move forward with its business plan, albeit under a slightly altered framework.Well, fast-forward over the weekend, and this is exactly what happened. Shares were halted pending some news from the company, and speculation as to what this these might be rippled through markets. Sentiment shifted to aggressive bullishness, and traders waited for an opportunity to get in as the news hit.And it was exactly as we had expected.The company has reshuffled its operational plans to incorporate the taking on of the D-Vasive platform, it's current owner and McAfee, by way of a licensing/employment type arrangement.

"Specifically, the Company plans to terminate the current Asset Purchase Agreement with D-Vasive. However, the Company has reached tentative agreements with John McAfee and Eric Anderson to execute employment agreements as Chief Executive Officer and Chief Technology Officer, respectively. In addition, the Company has reached a tentative agreement to exclusively license or acquire the Demonsaw source code and technology platform from D-Vasive."

While this can't be misinterpreted as definitive action – that is, to say, these plans are not yet executed on – the company now has a pathway defined that will see it get back on track and return to the execution of the strategy we outlined on the number of occasions in the past has been one that could generate long-term value for MGT and its shareholders.That is another upside to this situation, of course, and it is rooted in the evolution. Or, probably a better way of putting it, is the lack of dilution. As part of the initial deal, MGT was set to issue just shy of 44 million fresh shares, close to double the current outstanding count. This dilution would have impacted current holders, and while the majority of these holders recognized the value in bringing the McAfee and D-Vasive onboard, the dilution remained a bit of a sticking point for some. With the company not being able to register the shares for issue, and now having to bring on the two aforementioned as well as Anderson by way of an employment agreement, this sticking point is removed. Essentially, it's a best of both worlds situation – McAfee and the tech without any of the dilution.So, the big question is, what happens now?There are plenty of shorts left in the game, although many were likely squeezed out as part of the recent run-up, and we think there's the potential for further squeeze action near term. Whatever anyone thinks about this company's underlying business operations, it cannot be denied that its strategic communications department is doing a great job of maintaining a positive stream of press releases, and we think there is no shame in this sort of strategy. It's good for longs and bad for shorts, so the latter will always complain, but we're happy to ride it out for further upside.Longer term, it looks as though it is back to business as normal. Acquire as many cutting-edge cyber security technologies as possible and license them/sell them under a rebranded McAfee (Or MGT) moniker. The acquisition strategy may have to change a bit, if the company is having trouble registering shares to pay for its assets, but again, as long as alternative options are available, this isn't a bad thing for shareholders as – just as we have seen this week – it staves off dilutionSubscribe below and we will keep you updated as MGT and McAfee continue to execute on this strategy!Disclosure: We have no position in MGT and have not been compensated for this article.