February 22, 2018 8:23am
Sector intelligence and perspective
Always a sceptic as … the advance/decline line movement was pretty dramatic for the sector
Volume is still low which could set-up a response to yesterday’s upside to re-test lows again?
As the iShares Nasdaq Biotechnology (IBB) is indicating a NEGATIVE -0.36% downside in Thursday’s pre-market while the XBI and IWM are up and the XLV is not indicating
Pre-open indications: 4 BUYs and 3 SELLs
Out and about: Gilead Sciences (GILD) unit Kite has entered an agreement to collaborate in developing engineered cell therapies to treat cancer with Sangamo Therapeutics (SGMO). Under the terms of the deal, Kite will use SGMO's zine finger nuclease technology platform to develop the next-generation therapies for autologous and allogeneic use in treating different cancers. SGMO will receive $150 million in upfront payments and be entitled to up to $3.01 billion in potential payments while Mesoblast (MESO) had news of nearly 70% of children with potentially fatal acute Graft Versus Host Disease responded to treatment with an experimental stem cell therapy, meeting the primary goal of a late-stage U.S. trial.
Mixed and questionable open expected
Dow futures are DOWN -0.05% (-12 points) and NASDAQ futures are UP +0.22% (+17 points)
U.S. stock index futures trembled on Thursday as investors shook off fears of rising interest rates.
European markets drop as US rate risk impedes sentiment
Asia markets mixed after US losses following the latest Fed minutes
Issues to be faced at the open: Investor anxiety
Data docket: initial jobless claims will be released at 8:30 a.m. ET, followed by The Conference Board's Leading Economic Index at 10 a.m. ET and the Kansas City Fed manufacturing index, due out at 11 a.m. ET.
The economy: Fed Governor Randal Quarles, New York Fed President William Dudley, Atlanta Fed President Raphael Bostic, and Dallas Fed President Rob Kaplan are all due to deliver remarks at separate engagements Thursday — with investors waiting to see if they provide further comments on the central bank's minute’s release.
Been where, done what …
RegMed, stem and cell therapy sector’s record over 5 sessions (of 40 covered companies):
· Wednesday closed POSITIVE with 13 decliners, 24 advancers and 3 flats;
· Tuesday closed NEGATIVE with 26 decliners, 12 advancers and 2 flats;
· Monday the market was closed for President’s Day
· Friday closed POSITIVE with 17 decliners, 18 decliners and 5 flats;
· Last Thursday closed POSITIVE with 16 decliners, 20 advancers and 4 flats;
Henry’omics:
From last night’s newsletter, “… a comeback - right again … as I stated, “Sit and wait … for a melt-up of the oversold but, not all are due for a rise.”
As I had stated, “Recent trading has been marked by volatility, with sector equities posting sharp swings, luckily to the upside. Bottom line, the sector was oversold!”
But what about today?
Today’s indications:
- The iShares Nasdaq Biotechnology (IBB) is indicating a NEGATIVE -0.36% downside in Thursday’s pre-market;
- The SPDR S&P Biotech ETF (XBI) is indicating a POSITIVE +0.66% upside in Thursday’s pre-market;
- The Health Care Select Sector SPDR ETF (XLV) is NOT indicating in Thursday’s pre-open;
- The iShares Russell 2000 (IWM) is indicating a POSITIVE +0.24% upside in Thursday’s pre-open
Companies in my headlights:
AxoGen (AXGN) closed up +$0.75 to $28.50 with 227.2 K shares traded after Tuesday’s +$0.35 to $27.75 with 267.2 K shares traded <3 month average = 300 K shares>. A little too “toppy” for me in nine (9) sessions the shares have jumped from $24.40, that’s a $4.10 or +14.38% premium - Maintaining SELL;
Bellicum Pharmaceuticals (BLCM) closed down -$0.31 to $6.60 with 1 M shares traded after Tuesday’s +$0.31 to $6.91 with 2.38 M shares traded <3 month average = 754 K shares>. Just have a gut feeling of being overbought – Maintaining SELL;
bluebird bio (BLUE) closed up +$1.95 to $207.40 in a day’s range that went as high as $213.20 before it sold-off with 303.4 K shares traded after Tuesday’s -$7.90 to $205.45 with low volume of 593.1 K shares traded <3 month average = 964.2 K shares>. BLUE reported a loss of $117.2 million or -$2.52 in Q4/17. The results missed expectations for a loss of $1.64 per share. Although it posted revenue of $4.2 million in the period which also missed “street” forecasts having expected $7.2 million. For the year, BLUE reported that its loss widened to $335.6 million, or $7.71 per share. Revenue was reported as $35.4 million. BLUE’s shares have risen 16% since the beginning of the year. Share pricing has more than doubled in the last 12 months – time to lighten the “load” – BUY to SELL;
Mesoblast (MESO closed up +$0.14 to $5.415 as the aftermarket “pops” of +$0.36 or +6.56% on news of nearly 70% of children with potentially fatal acute Graft Versus Host Disease responded to treatment with an experimental stem cell therapy, meeting the primary goal of a late-stage U.S. trial. The study tested MESO's off-the-shelf stem cell product, remestemcel-L, in 55 children who did not respond to steroids after a bone marrow transplant triggered acute Graft Versus Host Disease (aGVHD). On day 28 after receiving the first dose of remestemcel-L, 69 percent of children had experienced a complete or partial response, deemed a statistically significant increase over historical expectations of about 45 percent, according to data presented at a medical meeting – BUY;
Regenxbio (RGNX) closed up +$0.65 to $27.10 after Tuesday’s -$0.40 to $26.45 with 222.8 k shares traded <3 month average = 370.2 K shares>. - Maintaining BUY;
Sangamo Therapeutics (SGMO) closed down -$0.05 to $22.20 and is up in the pre-market a positive +$1.80 or +8.11% on news of Gilead Sciences (GILD) unit Kite has entered an agreement to collaborate in developing engineered cell therapies to treat cancer. Under the terms of the deal, Kite will use SGMO's zine finger nuclease technology platform to develop the next-generation therapies for autologous and allogeneic use in treating different cancers. SGMO will receive $150 million in upfront payments and be entitled to up to $3.01 billion in potential payments – BUY;
Spark Therapeutics (ONCE) closed up +$1.11 to $51.34 with 954.1 K shares traded after Tuesday’s -$4.27 to $50.23 with 1.44 M shares traded <3 month average = 1 M shares>. Four (4) sessions ago, I saw $54.99 and $56.30 on 2/1 and $59.38 on 1/29 - 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.
