March 1, 2018 8:15am

… Characterizes the first session of the month

How do we correlate the discrepancies and inconsistency of daily sector movement?

It is not an expensive sector, yet optimism fades as anxiety turns to complacency

 

Pre-open indications: 3 BUYs and 5 SELLs

Today’s Q4 and FY17 results: XON

 

If you had been subscribing, today’s events would not have been a surprise …

 

Lower open expected

 

Dow futures are DOWN -0.44% (-110 points) and NASDAQ futures are DOWN -0.31% (-22 points)

 

 

U.S. stock index futures pointed to a lower open on Thursday, the first day of the month, adding to losses seen in the previous session.

European markets trade lower

Asian markets closed mixed

 

Issues to be faced at the open: higher interest rates

Data docket: jobless claims, personal income and outlays are set to be released at 8:30 a.m. ET, followed by the manufacturing purchasing managers' index (PMI) data at 9:45 a.m. ET; while the manufacturing ISM report on business and construction spending are due out at 10 a.m. ET.

 

Been where, done what …

RegMed, stem, gene and cell therapy sector’s record over 5 sessions (of 40 covered companies):

  • Wednesday closed NEGATIVE with 25 decliners, 14 advancers and 1 flat;
  • Tuesday closed NEGATIVE with 24 decliners, 15 advancers and 1 flat;
  • Monday closed POSITIVE with 17 decliners, 20 advancers and 3 flats;
  • Friday closed POSITIVE with 17 decliners, 21 advancers and 2 flat;
  • Last Thursday closed POSITIVE with 10 decliners, 28 advancers and 2 flats;

 

Henry’omics:

From last night’s newsletter, “…sector traded up until the last hour until the algorithms fried the incline erasing many gains as the IBB (-1.83%), XLV (-1.60%) as the XBI (-1.81%) dived as the NASDAQ (-0.78%) crumbled and volume is still weak.”

Many stocks got clobbered in February; yet there were many that saw some new highs.

But, remeber the sector is in the midst of Q4 and FY17 finacial reporing or loss-per-share "counts" which illuminates past spending tand the need for cash of more than a few.

The question is ... can those sector "participants" with elevated pricing retain the "didgets" of pricing?

... As we also stay "used" to volatility ...

 

Today’s indications:

  • The iShares Nasdaq Biotechnology (IBB) is indicating a NEGATIVE -0.41% downside in Thursday’s pre-market;
  • The SPDR S&P Biotech ETF (XBI) is indicating a NEGATIVE -0.12% downside 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 NEGATIVE -0.49% downside in Thursday’s pre-open

 

 

Companies in my headlights:

AxoGen (AXGN) closed down -$2.00 to $29.20 with 478 K shares traded   <3 month average = 291.9 K shares> after Tuesday’s +$1.70 to $31.20 after Monday’s +$0.55 to $29.50. As I had stated, AXGN was little too “toppy” for me and it took a hit before the release of Q4 and FY17 results which were not bad. The aftermarket indication is a positive +$1.75 or +5.99% - SELL to BUY;

Biostage (BSTG) closed up +$0.29 to $3.30 on what for in seven (7) it has gone barely anywhere? My opinion, after a 1 for 100 reverse split; that this management team short changed investors for their own salary continuance  after NOT management their executive team, FDA filing based on misleading and consequential pig studies that cost hundreds of thousands of dollars – again for what? Why has the CEO shunned investors by NOT communication before he “stole” their  shares or even communicated that he was “evaporating” their shares in the reverse split – it has been his pattern since taking over as CEO.  Run and SELL;

bluebird bio (BLUE) closed down -$2.15 to $201.00 with low 431.& K shares traded <3 month average = 972.1 K shares> after Tuesday’s  +$2.00 to $203.15 with 409.1 K shares traded after Monday’s -$4.90 to $201.50. Quarterly results missed expectations.  BLUE released Q4/17 earnings last Wednesday without warning or holding a conference call. Nevertheless, is there an arrogance factor as BLUE had to issue and update on Thursday evening. CEO Leschly has laid out the BLUE's plans for filing three (3) marketing applications over the next two years: with regulatory authorities in the next two years: LentiGlobin in TDT in 2018, Lenti-D in [cerebral adrenoleukodystrophy] in 2019 and, with its partners at Celgene, bb2121 in multiple myeloma, also in 2019.  What about 2018 (?), they’ll still be spending  - Maintaining SELL;

Fate Therapeutics (FATE) closed down -$0.24 to $11.26 after Tuesday’s -$0.56 to $11.50 after Monday’s +$0.30 to $12.06 after Friday’s +$1.18 to $11.76 with 1.05 M shares traded <3 month average =671.2 K shares traded>.  In twelve (12) sessions, the stock has risen from $7.80 – a $7.30 or -64.8% premium – Maintaining SELL;

Caladrius Bioscience (CLBS) closed up +$0.04 to $4.77 after Tuesday’s +$0.22 to $4.78 with 135.8 K shares traded <3 month average = 51.2 K shares> after Monday’s+$0.28 to $4.56 after Friday’s flat at $4.26 with 2.57 K shares traded after Thursday’s +$0.24 to $4.28 with 45.5 K shares traded. Eight (8) sessions ago, CLBS was trading at $3.78, maybe time to profit and maybe come back after quarterly results, that’s a $0.75 or 15.7% premium in the shares price – Maintaining SELL;

Mesoblast (MESO) closed up +$0.38 to $7.26 with 271.8 K shares traded <3 month average = 55.3 K shares>after Tuesday’s -$0.42 to $6.88 with 120.6 K shares traded after Monday’s +$1.11 to $7.30 with 157.2 K shares traded. Quarterly results are today and spending and cash position will be “illuminated”; the aftermarket indication is a positive +$0.14 or +1.93% - Maintaining BUY;

Sangamo Therapeutics (SGMO) closed up +$0.50 to $23.95 with 2.6 M shares traded <3 month average = 1.87 M shares>after Tuesday’s +$1.50 to $23.45 with 3.24 M shares traded. The Medicines and Healthcare Products Regulatory Agency (MHRA) of the UK has granted the Clinical Trial Authorization (CTA) for enrollment of subjects into the ongoing Phase 1/2 clinical trial evaluating SB-FIX, a zinc finger nuclease (ZFN)-mediated in vivo genome editing treatment for hemophilia B. The CTA allows for initiation of Europe's first in vivo genome editing study. The pre-market indication is a positive +$0.05 or +0.19% upside indication – Maintaining BUY;

Vericel (VCEL) closed up again +$0.15 to $8.25 after Monday’s +$0.80 to $8.10 with 1.13 M shares traded <3 month average = 661.2 K shares>. VCEL will be reporting Q4 and FY17 on 3/5 and I am still bothered by the $25 m ATM – how much have they utilized as pricing strength will be sold into. There is a +$1.05 or +13.1% premium in five (5) sessions and there is an aftermarket indication of a downside -$0.05 or -0.63% – Maintaining SELL;

 

 

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.