February 21, 2019 5:30am
Rallies are on the horizon but, not quite yet …
Sentiment is always a “crucible” and an indicator which can’t be totally quantified
Quarterly results: BioMarin Pharmaceuticals (BMRN)
Pre-open indications: 1 BUY, 1 SELL and 1 TRADE
Presenting alternative hypotheses clarifies material facts and evidence available to investors. “Devil’s Advocacy” also provides greater confidence that the current sector outlook will hold-up to close scrutiny!
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U.S. stock index futures are in the green
Dow futures are UP +0.15% (+38 points), S&P futures are UP +0.12% (+4 points) and NASDAQ futures are UP +0.21% (+15 points)
U.S. stock futures were slightly higher amid reports the U.S. and China have begun outlining a deal to end their protracted trade war.
European markets open mixed amid earnings and economic data;
Asian equities were mixed following an earlier slip in the morning as traders digest a release from the Federal Reserve.
Data docket: Jobless claims, the Philadelphia Fed manufacturing index, durable goods orders, manufacturing PMI (purchasing manager’s index) and services PMI are due later this morning.
Thursday’s indications in the pre-market:
The iShares Nasdaq Biotechnology (IBB) is NOT indicating
The SPDR S&P Biotech ETF (XBI) is NOT indicating
The Health Care Select Sector SPDR ETF (XLV) is NOT indicating
The iShares Russell 2000 (IWM) is indicating a POSITIVE +0.17% UPSIDE
Reports early Thursday morning said Washington and Beijing have begun drawing up memorandums of understanding over trade. Officials from both countries met for talks this week and higher-level discussions are set to be held on Thursday and Friday.
I’m on a plane early – so I will start with some early views on the pre-market opening numbers which will more than probably change.
Quarterly results will TEMPORARILY … drop sector pricing but, once their OVER – MANY will be considered OVERSOLD.
Sector focus will be on earnings today – BioMarin Pharmaceuticals (BMRN)
From Wednesday night’s post, “risk is acerbated by a down turning sector as quarterly forecasts are not meeting anticipation. Volatility is heightened as “street” expectations are taking a “kitchen insinkerator”
- Range of the 24 upside was +0.11% (AXGN) to +18.95% (RENE.L) while the 20 downside ranged from -0.29% (IONS) to -15.67% (CUR -$0.094) with 1 flat close (ONVO).
- 9 out of the 20 upside had higher (than the 3 month average) volume
- 6 out of the 24 downside experienced greater volume (than the 3 month average)
Companies in my headlights – It’s your decision; I provide an idea and context:
Sangamo Therapeutics (SGMO) closed down again -$0.26 to $8.46 after Tuesday’s -$0.07 to $8.72. The FDA accepted an IND application for ST-920, a gene therapy candidate being evaluated for the treatment of adults with Fabry disease. Current standard of care for this rare, progressive condition involves regular lifelong infusions of enzyme replacement therapy (ERT) – Maintaining BUY;
Mesoblast (MESO) closed up +$0.06 to $4.26 after Tuesday’s-$0.05 to $4.20 and reports yesterday. The P3 has enrolled but will the debt levels increase as the quarterly results get unveiled. MESO reported Q2 net loss of -$24.6 M or -$5.00 per share and 1st half “numbers - $77 M in cash ($15 M of debt financing), revenue of $13.5 M with an R&D increase of $2.4 M and SG&A with a $5.1 M financing cost – Maintaining SELL;
Ultragenyx Pharmaceuticals (RARE) closed up +$3.72 to $60.51 after Tuesday’s +$0.16 to $56.81; RARE reported a Q4 loss of $87.8 M or a per share loss of -$1.73. The results surpassed “street” expectations. The average estimate was for a loss of $1.74 per share. RARE posted revenue of $16.3 million in the period, also surpassing the “forecast” of $13.3 million. Ultragenyx shares have climbed 31% since the beginning of the year. In the final minutes of trading on Tuesday, shares hit $56.81, a climb of 21% in the last 12 months. It is getting RICH having opened January 2nd at $ 41.72 – I’d take a little OFF the table but, maintaining a position - TRADE;
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.