May 2, 2018 6:39pm

The question, are we snapping out of the doldrums, not quite yet - as expectations are very fickle

 

Bada bing bada boom

The NASDAQ (-0.42%) and IBB (-1.32%) were down

 

Refuge is being flat in a fluctuating sector

 

Out and about: Pre-open indications: 2 HIT and 4 MISS

Q1/18 “earnings”: bluebird bio (BLUE) and Aduro Biotech (ADRO)

 

End of day briefing; the “numbers” speak; if you know what happened today, you’ll understand what you need to do tomorrow!

Henry’omics:

Today’s moves … just another counter-cyclical move

Some sector “names” stocks kept the lights on: RGNX, CRSP, RENE.L, RARE and AXGN

While losers hid in the shed – BLUE (after yesterday’s pop), BMRN, ALNY, SAGE (earnings tomorrow) and ONCE

  • Surprise, PSTI stayed flat at $1.39 retaining most of its value after news!

 

The advance/decline line scenario of 45 covered companies:   

  • The open started negative with an ADL of 11/32 and 2 flats;
  • The mid-day flipped positive with an A/DL of 27/16 and 2 flats
  • The close concluded positive with an A/DL of 25/15 and 5 flat;

 

From Wednesday’s pre-open newsletter, “…the sector is weighing upcoming Q1 results as a few that announced have stumbled. Momentum is being run up and down by anemic volumes as consensus and expectation sensitivities are key indicators which doesn’t always stabilize share pricing?”

As we “roll” through Q1 results – expectation is diminishing – “History does tell us that lack of volume in itself is not a valid reason to sell. Furthermore, volume is not the indicator likely to tell us … about the “if “of this market.”

What concerns me is VOLATILTY related to earnings that are NOT being shaken-off!

Investors are in the period of short -term fatigue and I think people are just tired of being whipped!

A lack of enthusiasm lowers the capacity of investors to think about stepping-up further! 

 

Pre-open indications: 2 hit and 4 miss

  • Sage Therapeutics (SAGE) closed down -$1.13 – miss (should have remembered Q1 results tomorrow)
  • uniQure (QURE) closed up +$0.57 – miss (sold into strength);
  • MiMedx Group (MDXG) closed down -$0.27 – miss (still hanging for the upside and “numbers” clean-up;
  • Regenxbio (RGNX) closed up +$1.60 – hit;
  • Sangamo Therapeutics (SGMO) closed up +$0.75 – hit;
  • Spark Therapeutics (ONCE) closed down -$0.84 – miss – (actually surprised);

 

MY working five (5) trend lines:

… The greatest volume to the downside:  BMRN, MDXG, ALNY, VCEL and BLUE

… Upside volume was weighted to:  SGMO, VSTM, IONS, NTLA and CRSP

… Biggest $ downside:  BLUE (-$3.95), BMRN (-$3.79), ALNY (-$2.16), SAGE (-$1.13) and ONCE (-$0.84)

… Best moves to the $ upside:  RGNX (+$1.60), CRSP (+$1.11), RENE.L (+$1.00), RARE (+$0.94) and AXGN (+$0.85)

… Flats:  HSGX, MESO, BSTG, PSTI, CUR, AST, BTX and ONVO

 

Q1/18 financial results i.e. earning – the LPS (loss-per-share) skirmish:

Aduro Biotech (ADRO) …

The development platform:

  • Reported preclinical data on ADU-S100, BION-1301 and ADU-1604 at the American Association for Cancer Research
  • Reported initial observations from the first patient treated with our personalized neoantigen-based immunotherapy
  • Received a milestone payment from Merck for initiation of a P1 trial of its anti-CD27 antibody for patients with advanced solid tumors

The “numbers”

Net loss for the first quarter of 2018 was $21.5 million or -$0.28 per share, compared to net loss of $21.8 million, or $0.32 per share, for Q1/17.

Revenue was $6.6 million for the first quarter of 2018 compared to $3.8 million for Q1/17. The increase of $2.8 million was primarily due to a $3 million milestone payment received from Merck for initiation of a P1 trial for our anti-CD27 antibody

Cash, cash equivalents and marketable securities totaled $327.8 million, compared to $349.7 million at 12/ 31/17.

“Runway”: late 2020

ADRO closed up +$0.25 to $7.25

 

bluebird bio BLUE)…

Platform developments:

In February 2018, the final patient was treated in Northstar, in the P1/2 study designed to evaluate the safety and efficacy of LentiGlobin for the treatment of patients with TDT, reached two years of follow-up. The study, along with data from the HGB-205 study, and available data from the Northstar-2 Study (HGB-207), will form the basis of the European Marketing Authorization Application (MAA) submission, which is planned for the second half of 2018.

In March 2018, Celgene (CLGN) has exercised its option to co-develop and co-promote bb2121, an investigational anti-B-cell maturation antigen (BCMA) chimeric antigen receptor (CAR) T cell therapy for the potential treatment of patients with relapsed/refractory multiple myeloma in the US.

The “numbers”:

Net loss was $115.1 million or -$2.31 per share for Q1/18 compared to $68.7 million or -$1.68 per share for Q1/17.

Total revenues were $16 million for Q1/18 compared to $6.8 million for Q1/17.

Cash, cash equivalents and marketable securities as of March 31, 2018 and December 31, 2017 were $1.57 billion and $1.61 billion, respectively.

“Runway”:  mid 2021

BLUE closed down -$3.95 yet is UP +$1.15 in the aftermarket

 

Daily analytics:

Stocks closed lower on Wednesday after Fed's latest monetary policy announcement hinted at higher inflation ahead. The major indexes initially popped after the central bank made its announcement, but sold off sharply in the last hour of trading…

  • The Dow declined -0.72% (174.07 points) to 23,924.98,
  • The S&P closed down -0.72% (-19.13) to 2365.67
  • The NASDAQ dropped 0.42% (29.81) to 7100.90

 

The CBOE Volatility Index (VIX) widely considered the best gauge of fear in the market,

  • Wednesday traded at 15.97, up +3.10 %
  • Tuesday traded at 15.49, down -2.76%
  • Monday traded at 16.05, up +4.15%
  • Friday traded at 15.41 ,down -5.11 %
  • Thursday traded at 16.26, down -8.86%
  • Last Wednesday traded at 17.84, down -1%

 

The iShares Russell 2000 (IWM) indicated:

  • Wednesday was up +0.36%
  • Tuesday +0.46%
  • Monday -0.90%
  • Friday -0.14%
  • Thursday +0. 46%
  • Last Wednesday 0.15%

 

The iShares NASDAQ Biotechnology (IBB) indication:

  • Wednesday was down -1.32%
  • Tuesday +0.39%
  • Monday -1.86%
  • Friday +0.29%
  • Thursday +1.98%
  • Last Wednesday -0.01%

 

The count - decliners versus gainers:

……. look at the differences in decliners:

  • Wednesday’s decliners ranged from -0.11% <XON -$0.02 > to -4.40% <BMRN -$3.79> in 15 equities;
  • Tuesday’s decliners ranged from -0.75% <VCEL -$0.10> to -17.33% <RENE.L> in 15 equities;

Versus

… Look at the percentage’s (%) and spreads …

  • Wednesday’s gainers ranged from +0.26% <IONS +$0.11 > to +5.66% <SLDB +$0.83 > in 22 equities;
  • Tuesday’s gainers ranged from +0.45% <FIXX +0.09> to +5.30% <PSTI +$0.07> in 25 equities;

                                                                                                                                                                               

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.