RegMed Investors’ (RMi) pre-open: JP Morgan welcomes the chosen fewer, presentations aside – stand in line and wait for the stock ride as few or as many as they might be

January 8, 2018 8:01am

Novelty might meet money at SF’s mini and ancillary conferences; but, then there is the comparison of 2016’s share pricing versus milestones as compared to past, current and future spending

… What will initiate a “relationship” if there is a short or near term “hook-up”  for being long is very gone …

Beyond the crisis in confidence when fundamentals and facts are bent around share pricing’s “fiction”, the predictable result is investor polarization

… My newest thematic (polarity), the contrast between the corporate belief, investor opinion and their contradictions!

Pre-open indications: 4 SELLs and 2 BUYs

Lower open expected

Dow futures are DOWN -0.10% (-25 points) and NASDAQ futures are GOWN -0.19% (-13 points)

U.S. stock index futures pointed to a lower to maybe mixed open on Monday, boosted by the positive sentiment seen from trading overseas.

European markets moved higher after a firm lead by U.S. stocks in the previous session and as Germany looks closer to forming a new government.

Asian shares closed higher, following the strong lead from Wall Street in the last session. With few data releases expected during the session, many investors awaited earnings releases from regional corporates later in the week.

Issues that will affect the trading day: JP Morgan and the ancillary, surrounding, conferences and mini meetings if SF

Data docket: consumer credit due out at 3 p.m. ET.

Issues on the political front: The war OVER WHAT’S WRITTEN IN THE BOOL, Fury and fire; investors will be poring over the latest comments by leading Fed members as well as geopolitical tensions will continue to linger at the back of investors' minds, as tensions between North Korea and the West rumble on.

Henry’omics:

From Friday night’s closing bell post, “…slipping and sliding with negative sentiment vibes. Volume, volatility and momentum rule the session. As I had stated, “I am usually an optimist yet I feel a foreboding twitch re the sector’s utter speculation beyond the usual oversold or overbought conditions.” Friday’s upside share pricing seemed stretched while many of the downsized are oversold.”

Wait and listen – stand in corners and push through hallways – to meet your break-out “dates”.

The quiet time to get-it-started is over a cocktail or a quiet room!

Remember you’re not buying a pair of shoes – or are you (?) to keep walking into the New Year!

Sickness prevents me from infecting the hallways at healthcare's "Woodstock".

The cell therapy sector’s record over 5 sessions (of 40 covered companies): The RegMed and cell therapy sector closed NEGATIVE on Friday, POSITIVE on Thursday, Wednesday and Tuesday, as Monday was New Year ’s Day:

·         Friday closed barely NEGATIVE with 20 decliners, 18 advancers and 2 flats;

·         Thursday closed barely POSITIVE with 19 decliners, 21 advancers and 0 flats;

·         Wednesday closed POSITIVE with 15 decliners, 23 advancers and 2 flats;

·         Tuesday closed POSITIVE with 7 decliners, 31 advancers and 2 flats;

·         Last Monday was NEW Year’s day;

Today’s indications:

• The iShares Nasdaq Biotechnology (IBB) is indicating a POSITIVE +0.07% in Monday’s pre-market;
• The SPDR S&P Biotech ETF (XBI) is indicating a POSITIVE +0.18% in Monday’s pre-market;
• The Health Care Select Sector SPDR ETF (XLV) is indicating a POSITIVE +0.01% in Monday’s pre-open;
• The iShares Russell 2000 (IWM) is indicating a NEGATIVE -0.1% in Monday’s pre-open

Companies in my headlights:

Adverum (ADVM) closed up again +$0.05 to $4.45 with 877.4 K shares traded <3 month average = 464.2 K shares> after Thursday’s +$0.10 to $4.40 with 1.49 M shares traded after Wednesday’s +$0.65 or $17.81% to $4.30 with 1.53 M shares traded and Tuesday’s +$0.15 to $3.65 with 1.79 M shares traded.  Their is a $0.75 or 17.04% premium over three (3) sessions which meets my 15% threshold, December started at $3.05, November at $3.15 and October at $3.90 while September began at $2.80 - Maintaining SELL;

Applied Genetic Technologies (AGTC) closed up again +$0.20 to $4.30 with 112.1 K shares traded <3 month average = 110.5 K shares>after Thursday’s +$0.20 to $4.10 with 191.9 K shares traded. The aftermarket indication is a negative -$0.07 or -1.72%. The three (3) sessions of the 2018 have been good as the previous Friday (12/29) closed at $3.67 having been down from Thursday’s $3.67. There is $0.70 in the “till” or an upside of +16.2% which in its history is usually NOT sustainable – Maintaining SELL;

Asterias Biotherapeutics (NYSEMKT: AST) closed up +$0.05 to $2.50 with 316.8 K shares traded <3 month average = 194.9 K shares> after Thursday’s +$0.30 to $2.45 with 1.068 M shares traded after a shareholder letter outlining 2018 milestones – my issue targets are basically mid-year and pricing is usually unsustainable and their cash position reflects a reduced burn rate – key words to be questioned. Wednesday’s pricing was $2.16, Tuesday was $2.15 and the previous Friday (12/29) was $2.25 after Thursday’s $2.30. That’s a +14% (+$0.35) premium in four (4) sessions – Maintaining SELL;

Cytori Therapeutics (CYTX) closed up +$0.52 to $0.47, a +73.75% upside but, answer the question – how many times has CYTX fooled us before? Four, five, I’ve lost track; loss after loss, dilution and depreciation after multiple financings and dropped programs – he has NEVER delivered and has been seeking strategic re-directions.  Note, CEO Mark Hedrick would sell his soul and any investor to exit with a change pf control package, I remember the stock at $5.21 – SELL;

MiMedx Group (MDXG) closed up +$0.17 to $12.39 with a positive aftermarket indication of $0.21 or +1.58%. Q4/ 17 make 28 consecutive quarters of sequential revenue growth and 27 of 28 quarters of meeting or exceeding revenue guidance. Q4 2017 revenue of $90.9 Million grew 30% over Q4 2016 revenue and exceeded upper end of guidance by nearly $3 million excluding divested subsidiary, Stability Biologics, Q4 2017 revenue grew by 34% over Q4 2016. Q4 2017 Wound Care revenue grew 27% over Q4 2016. Surgical, Sports Medicine and Orthopedics (SSO) revenue for Q4 2017 grew 40% over Q4 2016 - BUY

Verastem (VSTM) closed down again on Friday -$0.08 to $2.97 with 1.62 M shares traded<3 month average = 863 K shares> after Thursday’s -$0.09 to $3.05 with 833.2 K shares traded  after Wednesday’s $3.14, Tuesday’s $3.21 and the previous Friday’s (12/29) $3.07 after Thursday’s $3.20. VSTM amended its Loan and Security Agreement with Hercules Capital increasing its existing borrowing limit under the loan facility from $25 million to up to $50 million in financing.  VSTM had received the first $15 million of financing under the original Loan and Security Agreement. Additional tranches of up to $35 million in aggregate will be available to VSTM to drawdown subject to certain conditions – it’s better (cheaper)than an offering, although it still costs stock and warrants – Maintaining BUY;

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.