May 11, 2018 7:40am

The curve balls of street expectations and results are not as weighty as anticipated

Cash positions are “in a league of their own” in most cases and those that aren’t will have serious “runway” and investment issues re capital raises

 

Time to bunt!

 

Pre-open indications: 3 BUYs and 4 SELLs

 

This newsletter speaks for a return on investment and a definition of risks. Anxious investors need to understand that return on an investment is achieved in the short-term (in “our” sector) which validates your capital’s outlay.

The understanding of indications sheds light on share pricing!

US stocks set to post slight gains at the open amid economic data revelations

Dow futures are UP +0.21% (+51 points) and NASDAQ futures are UP +0.11% (+8 points)

 

Index futures are relatively mixed ahead of Friday's open.

The European index was on course to its seventh straight week of gains — the longest on record since March 2015.

Most Asian stocks closed higher on Friday, with positive sentiment partially driven by gains seen on Wall Street following softer-than-expected U.S. inflation data.

 

Data docket: at 8:30 a.m. ET U.S. import and export price indexes are set to be published, followed by consumer sentiment figures at 10 a.m. ET.

 

Today’s indications:

  • The iShares Nasdaq Biotechnology (IBB) is NOT indicating in Friday’s pre-market;
  • The SPDR S&P Biotech ETF (XBI) is NOT indicating in Friday’s pre-market;
  • The Health Care Select Sector SPDR ETF (XLV) is NOT indicating in Friday’s pre-open;
  • The iShares Russell 2000 (IWM) is indicating a POSITIVE UPSIDE of +0.18% in Friday’s pre-open

 

Henry’omics:

Today’s moves:  Another session of the IBB, XBI and XLV NOT indicating, a Friday ending with economic data; the A/DL’s (advance/decline line) alternating cycle, 33 of 45 covered companies having announced Q1 and Q3’s, quarterly results,  the week’s ebbing of the IBB - I am looking to profit from a few upside positions to sell into strength!

President Trump will unveil a plan today to limit prices on some costly drugs, another harangue that will go where after the heated rhetoric!

From Thursday’s night’s newsletter: “running the bases while volume is low, the sector stays on stride as Q1 results head home.” I also stated, “Estimates for Q1/18 have taken a beating as LPS (loss-per-share) numbers rule! There has not been any improvement in Q1 relative to what was expected.”

 

Review the past 5 session of 45 covered companies – the line-up:

  • Thursday closed POSITIVE with 18 decliners, 26 advancers and 1 flat;
  • Wednesday closed POSITIVE with 12 decliners, 31 advancers and 2 flats;
  • Tuesday closed NEGATIVE with 28 decliners, 16 advancers and 1 flat;
  • Monday closed POSITIVE with 15 decliners, 29 advancers and 1 flat;
  • Last Friday closed POSITIVE with 8 decliners, 34 advancers and 3 flat

 

A re-cap:

  • A new month to measure … in eight (8) sessions in May, six (6) positive and two (2) negative closes;
  • In the last five  (5) sessions, the iShares NASDAQ Biotechnology (IBB) was down in two (2) and up in three (3) session for an aggregate of negative -0.33% after Thursday’s +0.06%, Wednesday’s +1.35%,  Tuesday’s -0.57%, Monday’s +0.64%,  Friday’s +1.06% and last Thursday’s -1.36%;
  • Thursday’s decliners ranged from -0.24% <BLFS -$0.02 > to -12% <KOOL -$0.18 > in 18 equities;
  • Thursday’s gainers ranged from +0.11% <ONCE +$0.08 > to +10.91% <BSTG +$0.33 > in 26 equities;

 

Company in my headlights:

Athersys (ATHX) closed up +$0.01 to $2.10. ATHX reported a net loss of $10.2 million, or -$0.08 per share compared to $5.6 million or -$0.06 per share in Q1/17. ATHX recently completed a $21.1 million equity investment and plans to expand the HEALIOS K.K. collaboration by 6/1/18; proposed expansion includes a $10 million license fee funded in an escrow account and a potential additional $25 million of committed payments over time, as well as additional possible payments including milestones and royalties, if the collaboration is fully expanded in accordance with the letter of intent disclosed in March 2018. Cash and cash equivalents of $49.78 million, exclude the $10 million in escrow from Healios related to the proposed collaboration expansion. The aftermarket indication is for an upside of +$0.05 or +2.38% - BUY;

BioLife Solutions (BLFS) closed down -$0.02 to $8.25 and is UP +$0.49 or +5.94% in the aftermarket after posting Q1 earnings with a 61% revenue growth at $3.8 million. BLFS achieved operating profitability by acquiring 19 new direct customers, including several T cell therapy startups. Net loss was $103 K or $0.01 per share, compared to $870,000, or $0.07 per share in Q1/17; with a cash balance of $7 million compared with $2.3 million in Q1/17 due to an exercise of warrants – BUY;

BioTime (NYSEMKT: BTX) closed up +$0.03 to $2.21 before reporting Q1 “earnings” - net loss was $63.5 million, or -$0.50 per share, compared to net income of $49.3 million, or $0.46 per share for Q1/17.  Cash, cash equivalents were $31.4 million, compared to $38.2 million as of 12/31/17 with a “runway” lasting until 2020. The aftermarket indication is for a downside of -$0.11 or -4.98% – SELL;

Editas Medicine (EDIT) closed down -$0.90 to $33.56 after reporting a Q1 reported a loss of $30.9 million or -$0.67 per share. “Street” results exceeded expectations in revenue and per share expectations. The aftermarket indication is for a downside of -$0.31 or -0.92% - SELL;

Fate Therapeutics (FATE) closed up +$0.14 to $10.96. FATE reported a loss of $14.1 million or -$027 per share which missed “street” expectation of -$0.22 per share and posted revenue of $1 million, which also missed the expectation of $2 million. FATE has risen 80% since 1/2/18. The aftermarket indication is for a downside of -$0.61 or -5.57% – SELL;

Intrexon (XON) closed up +$0.02 to $18.64. XON reported a net loss of $42 million or -$0.33 per basic share, including non-cash charges of $26.3 million. The aftermarket indication is a downside of -$1.39 or -7.46% - SELL;

Regenxbio (RGNX) closed up +$2.10 to $47.10 after Wednesday’s +$5.35 to $45.00, Tuesday’s $39.65, Monday’s $39.75, last Friday’s $39.85 and the previous Thursday’s $39.10. On Tuesday, RGNX reported Q1 net income of $104.2 million or$3.04 per share while also posting revenue of $132.4 million. The aftermarket projects an upside of +$0.45 or +0.96% - SELL to 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.