July 26, 2019 8:44am

Are the Q2 earnings LPS (loss-per-share” results which will wreak havoc on share pricing

Expectation anxieties versus actualization fostered by anticipation

News: Solid Biosciences Inc. (SLDB) has entered into a securities purchase agreement with a select group of institutional investors and accredited investors for a $60 million private placement, which is expected to close on or about 7/30/19 <read more>…

Pre-open indications: 3 BUYs and 3 SELL

It's a daunting task to understand risk, seeing the unforeseen; on the basis of my own “rules”, I set-up my own “warning analysis” which isn’t machine oriented!  

 

I make a commitment to provide need-to-know “facts in evidence” as equity’s volatility is one tactical signal for stocks.

 

Dow futures are UP +0.24% (+64 points), S&P futures are UP +0.20% (+6 points) and NASDAQ futures are UP +0.23% (+19 points)

 

U.S. stock index futures were higher as traders looked ahead to GNP data and weighed the possibility of a less dovish tone from the Fed next week;

European stocks were marginally up after the European Central Bank (ECB) suggested it could lower borrowing costs to tackle a slowdown in the euro zone economy with the pan-European Stoxx 600 up around +0.1% during early morning deals;

Asia Pacific stocks broadly decline amid expectations of less aggressive Fed

 

Data docket: GDP numbers – slows to -2.1%

 

Henry’omics:

Traders will be monitoring new economic data, with U.S. gross domestic product (GDP) figures due at 8:30 a.m. ET. The broadest measure of the U.S. economy is expected to come in at 1.8% <CNBC>.

Traders are also currently pricing a cut in rates by a quarter percentage point, not a half point, as some analysts had previously forecast ahead of the Fed’s meeting.

News (continued):

Solid Biosciences (SLDB) has entered into a securities purchase agreement with a select group of institutional investors and accredited investors for a $60 million private placement, which is expected to close on or about July 30, 2019, subject to the satisfaction of customary closing conditions. 

The private placement includes a mix of new and existing investors, including Perceptive Advisors, LLC, Boxer Capital, LLC, EcoR1 Capital, LLC, Bain Capital Life Sciences, RA Capital Management, Waverly Capital, Invus and certain board members and executive officers.  SVB Leerink acted as the exclusive placement agent with the private placement.

In this private placement, SLDB is selling 10,607,525 shares of common stock at a price of $4.65 per share, representing a premium to the share price as of market close on July 25, 2019. In addition, SLDB  is selling 2,295,699 pre-funded warrants at a price of $4.64 per warrant.

SLDB on Thursday closed down -$0.33 or -6.88% to $4.33 …

 

Q2 earnings update:

  • “Our” universe earnings kick-off on 8/1 with Intellia Therapeutics (NTLA), Verastem Oncology,(VSTM), BioMarin Pharmaceuticals (BMRN), Ultragenyx Pharmaceuticals (RARE) and Sage Therapeutics (SAGE);  Alnylam Pharmaceuticals (ALNY) and AxoGen (AXGN) on 8/6, Athersys (ATHX) on 8/7 and Organovo (ONVO) with Adverum Biotechnologies (ADVM) on 8/8.

 

From Thursday’s evening post, “slow is smooth, smooth is fast. Investors need to think about a buying or selling pace, momentum and anticipate encountering resistance; also consider covering positions,”

  • The NASDAQ was down -82.96 or -1% to 8,238.54;
  • The close was negative with an A/D Line of 11/32 and 0 flat and 2 acquired;
  • The range of the 11 upside was +0.03% (ONCE) to +6.42% (BSTG +$0.14) while the 32 downside ranged from -0.25% (HSGX) to -25.60% (CUR -$1.28 – an offering initiated);
  • the IBB closed down -1.40% while the XBI closed down -2.27%
  • 1 out of the 11 upside had higher than the 3 month average volume;
  • 7 out of the 32 downside had higher than the 3 month average volume;

Q3/19 so far: there were 7 positive, 1 holiday and 11 negative closes;

 

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

Last night’s news:

Verastem Oncology (VSTM) signs an exclusive license agreement to develop and commercialize with Sanofi for COPIKTRA® (duvelisib) in Russia and CIS, Turkey, the Middle East and Africa. VSTM to will receive an upfront payment of $5 M; then eligible to receive up to $42 M in milestones and double-digit percentage royalties – BUY;

 

Oversold:

  • Ions Pharmaceuticals (IONS) - BUY
  • uniQure (QURE -$0.69) grossly oversold, stock keeps getting cheaper- BUY
  • Sage Therapeutics (SAGE -$13.27 after Wednesday’s -$5.46, Tuesday’s -$1.04 and Monday’s -$1.39); – BUY;

Overbought:

  • Pluristem (PSTI +$0.27 to $4.53 post 1-for-10 reverse) - SELL
  • CRSPER Therapeutics (CRSP +$0.52) – SELL;
  • ReNeuron (RENE.L -$5.00) – 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.