BOSTON ( TheStreet) -- Michael A. opens this week's Biotech Stock Mailbag with a question about Peregine Pharmaceuticals ( PPHM): "Peregrine has come a long way from the 1990s when they were doing just mice along and today they are doing trials on people. They will be going to phase III trials within a few more months. Did you listen to the conference call on July 16? Your thoughts now? I see big things coming from Peregrine." Peregrine executives are sneaky and two faced. In public, Peregrine CEO Steven King talks enthusiastically about the "exceptional" data from a phase II study of bavituximab in non-small cell lung cancer that has resulted in a "surge" in interest from potential partners. Privately, however, King has directed the company to sell massive amounts of stock in opaque, back-door financing deals that have diluted shareholders by an astounding 45% in the most recently completed fiscal year, regulatory records show. Investors should pay more attention to what company executives do, rather than listen to what they say. In Peregrine's case, the company is selling tons of cheap stock on the sly, mostly to uninformed retail investors who are buying it on the belief that company executives are sincere about their stated excitement for bavituximab. Well, if the bavituximab data were so great -- and by inference Peregrine was significantly undervalued -- the company wouldn't stoop to raise money at such low levels. But yet that's exactly what Peregrine has been doing. In the fiscal year that ended on April 30, Peregrine sold 31.1 million shares of stock. Peregrine's share count as of April 30 was 101.4 million, which means the company diluted shareholders by 45% in the 2012 fiscal year over fiscal 2011, according to regulatory records. Almost 80% of Peregrine's fiscal 2012 stock sales came through At The Market (ATM) stock offerings. These ATM financing arrangements allow companies, through a broker or investment bank, to sell treasury stock to investors at current market prices. Small companies like ATMs because it's a relatively easy and cheap way to raise cash. But these financing vehicles aren't so great for current shareholders because companies do not have to disclose the sale of stock through ATMs except in customary regulatory filings at the end of each quarter or fiscal year. Peregrine executives don't talk publicly about the company's ATM sales. In fact, Peregrine does a pretty good job of keeping these stock sales as opaque as possible, burying details in the footnotes of its most recent 10-K filed with the Securities and Exchange Commission.