May 14, 2019 7:57am

Pre-open indications: 3 BUYs and 3 SELLs

Q1 results reporting: Biostage (BSTG) - prepares to run-out of operating cash with Cesca Therapeutics (KOOL) coming later

British Prime Minister Benjamin Disraeli is reputed to have said, "There are three kinds of lies: lies, damned lies, and statistics."

 

Whether information or intelligence is good, bad or somewhere in between; I put into context what is relevant and useful for investors.

 

The culprit is LPS (loss-per-share) earnings, runways and risk: The quarterly performance sweepstakes are almost always dominated by high-risk strategies that try to hit home runs every time at bat. Though, occasionally, some CEOs hit a ball out of the park, more often than not they strike out, leading to huge losses for their clients!

 

Dow futures are UP +0.66% (+166 points), S&P futures are UP +0.77% (+22 points) and NASDAQ futures are UP +1.03% (+75 points)

 

Dow futures indicated a gain of more than 100 points at the open; S&P 500 and Nasdaq 100 futures also point to early gains;

European stocks traded higher Tuesday morning as investors began to mitigate the sharp downturn caused by China’s announcement of retaliatory tariffs on U.S. imports;

Asian stocks decline as US-China trade war heats up

 

Henry’omics:

It’s time for the sector to rise as I had stated yesterday, “Time for some sector movement even with the current levels of market uncertainty. It’s not time to fold the tent, bet on in the sector in those who beat expectation, strong cash positions and guidance!”

 

U.S. equity futures rose Tuesday as investors weighed the impact of the escalating trade war between the United States and China.

The Dow and S&P 500 suffered their worst days since early January, and the Nasdaq Composite had its biggest single-day loss of the year.

From Monday’s closing bell post, “there was share pricing blood on the floor and spatter on the walls.”

  • Monday closed NEGATIVE with 39 decliners, 4 advancers, 0 flat and 2 acquired (AST & OSIR) of my 45 covered companies as the IBB dumps -3.50%;
  • Monday’s range of the 4 upside was +2.94% (AGTC) to +4% (CUR +$0.0165) while the 39 downside ranged from -0.10% (HSGX) to -6.55% (BLUE);
  • In the past five (5) sessions, the IBB closed down -7.04%;

Q2/19 so far:

  • In May, there were 6 negative and 3 positive closes;
  • In April, there has been 10 positive and 11 negative closes;

 

Q1/19 results: Biostage (BSTG)

BSTG reported a net loss of $1.9 M, or -$0.32 per share, compared to a net loss of approximately $1.5 M, or a net loss of $0.56 per share for Q1/18. The $400 K year-over-year increase in net loss was attributable primarily to a $500 K increase in R&D costs and a $100 K decrease in non-cash expense from change in the fair value of warrants.

BSTG also recognized grant income for qualified expenditures from a Fast-Track Small Business Innovation Research (SBIR) grant of $114,000 in Q1 and $59,000 in Q1/18.

BSTG had cash on-hand of $1.1 M and no debt and used net cash in operations of approximately of $1.2 M during Q1.

Yet, one should NOTICE the increase from zero; the liabilities section of cash payables, and accounts payable ($752 K) and the continuing lease amounts - adds up to -$1 m) as usual they <management> just pushed-out (balance sheet manipulation) their payments to enhance or make their cash position ... still even WEAKER!!!

Runway: early Q2/19

 

Companies in my headlights – It’s your decision; I provide an idea and context: post earnings release:

Pre reporting of Q1 results:

Biostage (BSTG) closed down -$0.03 – reporting today its cash position, runway and lack of regulatory standing; it’s NOT about the present but, the last quarter. How many excuses does this CEO have left after too many BAD decisions affected past stake and shareholders? – Maintaining SELL;

 

Post reporting of Q1 results:

Homology Medicine (FIXX) closed down -$0.51 to $22.22 missed per share consensus and revenue “street” estimates and expectation. Over the last four (4) quarters, FIXX has not been able to surpass consensus EPS estimates. – SELL;

Solid Biosciences (SLDB) closed down -$0.33 to $8.85 and has a post Q1 reporting a negative -$0.60 or -6.78%. New set of safety issues after reporting dismal responses from a small cohort of patients receiving its gene therapy for Duchenne muscular dystrophy - SELL;

Ionis Pharmaceuticals (IONS) closed down -$2.73 to $66.56 after Friday’s -$1.92 and exceeding “street” expectation – Maintaining BUY;

BioLife Solutions (BLFS) closed up +$0.16 to $16.73 after last week’s reporting net income – Maintaining BUY;

ReNeuron (RENE.L) closed down -$5.00 to $ following Friday’s -$6.00. RENE.L has a time differential trading of +$4.00 after a few down sessions – 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.