April 1, 2024 4:34pm

No need for smoked glasses as earnings season is all but over after share pricing weaknesses highlighted Q1/24

Pre-open Indications: 4 Hits and 3 Miss

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The present and future value of RegMed Investors (RMi) NEWS sheds light on the stem, cell and gene therapy sector’s risks to share pricing and the sector’s upside acrobatics and potential downslides.

I write this blog/newsletter to inform investors with facts and supporting numbers focused on what they need to hear that others will not say or write about – facts in evidence! 

 

Monday: The Dow closed DOWN -240.52 points or -0.60%, the S&P closed DOWN -10.58 points -0.20% while the Nasdaq closed UP +17.37 points or +0.11%

 

Henry’omics:

We need to more than consider the economic environment - rising rates and inflation to comprehend the micro re “our” universe of cell and gene therapy companies …

The Dow and S&P slipped as the Nasdaq moved upward yet barely.

Economic Data Docket: The ISM's manufacturing PMI registered a reading of 50.3 in March, up from February's reading of 47.8 and higher than the 48.3 economists expected. The March reading marks the highest for the index since September 2022 and the first-time manufacturing activity has expanded since October 2022. Readings above 50 for this index indicate an expansion in activity while readings below 50 indicate contraction.

  • S&P Global's own manufacturing PMI reading out Monday showed US manufacturing production reached a 22-month high in March. The firm's broader measure of manufacturing activity hit 51.9 in March, down from February's reading of 52.2, which was the highest since July 2022.S&P Global Manufacturing PMI signaled a further encouraging improvement in business conditions in March,

 

Monday’s RegMed Investors’ (RMi) opening bell: “Steaming into April, risk still flows through the sector and market. Indicators are flashing that the market's height may be due for a break as economic data gets weightier.”  … https://www.regmedinvestors.com/articles/13397  

 

Pre-open Indications: 4 Hits < Alnylam Pharmaceuticals (ALNY +$3.88), CRISPR Therapeutics (CRSP +$0.02), Regenxbio (RGNX +$0.46), Voyager Therapeutics (VYGR +$1.23)> and 3 Miss < Vericel (VCEL +0.88), Solid Biosciences (SLDB -$0.88), Intellia Therapeutics (NTLA -$0.29)>

 

Advance/Decline (A/D) Line:

  • Monday’s advance/decline line at the open was negative with 8 incliner, 26 decliners and 1 flat; ending with a negative close of 15 incliners, 20 decliners and 0 flat

 

Ebb and flow of MY covered sector cell and gene therapy session daily “endings”:

Q2/24: 1 negative close

Q1/24:

  • March, 1 holiday, 8 positive and 12 negative closes
  • February, 1 holiday, 9 negative and 11 positive closes
  • January: 2 holiday, 12 negative and 8 positive closes

 

Key Metrics:

The iShares NASDAQ Biotechnology (IBB) and the SPDR S&P ETF (XBI) indicators:

  • Monday, the IBB was down -0.30% and the XBI was down -1.10%

The CBOE Volatility Index (VVIX: INDEX) tracked:

  • Monday was up +0.67 point or +5.15% at 13.68

 

Monday’s Closing Down (10 of 20):

  • Solid Biosciences (SLDB -$0.88 after Thursday’s -$1.11),
  • Sage Therapeutics (SAGE -$0.84 after Thursday’s -$0.30),
  • BioLife Solutions (BLFS -$0.65 after Thursday’s +$0.09),
  • Verve Therapeutics (VERV -$0.49 after Thursday’s +$0.09),
  • Beam Therapeutics (BEAM -$0.38 after Thursday’s -$0.92),
  • Intellia Therapeutics (NTLA -$0.29 after Thursday’s +$0.49),
  • Fate Therapeutics (FATE -$0.26 after Thursday’s $0.00),
  • Adverum Biotechnologies (ADVM -$0.25 after Thursday’s -$0.52),
  • MiMedx (MDXG -$0.25 after Thursday’s +$0.09),
  • Prime Medicine (PRME -$0.24 after Thursday’s +$0.24),

Monday’s Closing Up (10 of 15):

  • Alnylam Pharmaceuticals (ALNY +$3.88 after Thursday’s -$4.94),
  • Blueprint Medicine (BPMC +$1.56 after Thursday’s +$5.12),
  • Voyager Therapeutics (VYGR +$1.23 after Thursday’s -$0.25),
  • Mesoblast (MESO +$1.07 after Thursday’s +$1.52),
  • Vericel (VCEL +$0.88 after Thursday’s -$0.31),
  • Ionis Pharmaceuticals (IONS +$0.59 after Thursday’s -$1.31),
  • Regenxbio (RGNX +$0.46 after Thursday’s -$1.11)
  • Ultragenyx Pharmaceuticals (RARE +$0.28),
  • Generation Bio (GBIO +$0.22 after Thursday’s +$0.37),
  • Brainstorm cell Therapeutics (BCLI +$0.17),

 

Q1/24 – March

  • (4/1) Monday closed negative with 15 incliners, 20 decliners and 0 flat

 

The BOTTOM LINE:  The coming economic data week beacons an eclipse of share pricing as the title informed.

The Nasdaq shed -0.1%; as the cell and gene therapy sector flipped downward starting Q2 and April dribbling while volume on the Nasdaq fell.

Also, as expected the benchmark 10-year yield added 12 basis points to 4.33% — on pace for the largest one-day increase since Feb. 13. The two-year Treasury yield added 9 basis points to 4.71% while the one-year Treasury yield added 6 basis points to 5.08%.

I favor … caution over the next few weeks!

 

Interesting quote, “The market is overbought by any measure,” said Quincy Krosby, chief global strategist at LPL Financial. “At some point, we will see a pullback, and then at that point, you’ll start to hear the bears come out again suggesting that it’s deeper than just a healthy correction.”

 

Earnings, net losses, and per-share losses, runways and guidance have begun Q4 and FY23 which WILL be crucial to continue downside force in the sector as history has taught us i.e., investors.

  • I have seen 4 net income for the Q4 and FY23 - MiMedx (MDXG) and Voyager Therapeutics (VYGR) followed by Q4 CRISPR Therapeutics (CRSP) and Beam Therapeutics (BEAM) <but each had a FY23 loss>
  • 30 have reported … RegMed Investors (RMi) - Q4/23 & FY23 Cell and Gene Therapy Earnings Scorecard Results
  • https://www.regmedinvestors.com/articles/11628

Still not finished with Q4 and FY23 earnings releases, remaining:

  • BLCM, CLLS, GRPH, FIXX, IONS,

 

“I ALSO reiterate, “Don't chase the cell and gene therapy sector, especially with the Nasdaq extended.” Short and non-sweet: SELL into STRENGTH – accumulate some “powder” i.e., cash!

 

The top three (3) performing in the session:

  • Monday: Alnylam Pharmaceuticals (ALNY), Blueprint Medicine (BPMC) and Voyager Therapeutics (VYGR)

The worst three (3) in the session:  

  • Monday: Solid Biosciences (SLDB), sage therapeutics (SAGE) and BioLife Solutions (BLFS)

 

Welcome to my world of defining the “grey’ in our universe!

  • Right up front, “I also hate to be so negative or contrarian but, this is a NO spin zone and facts are its product; I can always be WRONG but … I am mostly EARLY!”

 

Opinions expressed are those of the author and are subject to change, and not intended to be a forecast of future events, a guarantee of future results, nor investment advice. Whether information or intelligence is good, bad, or somewhere in between; I put into context what is relevant and useful for investors.  All investments are subject to risks. Investors should consider investment objectives.

Henry McCusker, the editor, and publisher of RegMed Investors does not hold or have positions in securities referred to in this publication. Regulation Analyst Certification (Reg AC): The research analyst primarily responsible for the content of this report certifies the following under Reg AC: I hereby certify that all views expressed in this report accurately reflect my personal views about the subject company or companies and its or their securities.

I also certify that no part of my compensation was, is or will be, directly or indirectly, related to the specific recommendations or views expressed in this report.