RegMed Investors’ (RMi) pre-open: always be prepared to locate an exit

May 21, 2020 8:02am

New highs make one’s portfolio happy but, not being realized; losses are nothing but an excuse for investor complacency

Pre-open indications:  4 BUYs and 6 SELLs     

What I provide is an “intelligence daily” to inform the RegMed/cell and gene therapy sector and its investors utilizing indication and warning analysis. Check the BOTTOM LINE <read more>

Dow future are DOWN -0.53% (-129 points), S&P futures are DOWN -0.53% (-16 points) and NASDAQ futures are DOWN -0.37% (-36 points)

U.S. stock index futures fell on Thursday as investors took a breather from Wall Street’s robust gains so far this week;

European stocks declined as euro zone PMI (purchasing managers’ index) data indicated another slowdown in activity for the region’s manufacturing and services industry in May.

• Germany’s DAX index and France’s CAC 40 each fell by 1.3% while Britain’s FTSE 100 slid 0.9% lower. Due to the Ascension Day public holiday, markets are closed in Switzerland, Austria, Norway, Sweden and Denmark.

Asia Pacific mostly declined as investors continued to monitor the reopening of economies amid the coronavirus pandemic. Mainland Chinese stocks dipped, japan closed lower, and Australia declined at its close; while, the MSCI Asia ex-Japan index was 0.24% lower.

Data Docket: Thursday’s forthcoming update to the U.S. unemployment claims threatened to keep the week’s optimism in check.

• The Department of Labor is scheduled to release the latest update to initial jobless claims at 8:30 a.m. ET Thursday morning.
• Economists expect the government to announce yet another deceleration in the pace of claims, the consensus estimate predicts another 2.4 million Americans filed for insurance during the week ended May 16.

• IHS Markit euro zone PMI data (Thursday morning) showed that economic activity contracted less drastically in May, with many countries in the bloc taking steps to reopen their economies.
• The composite PMI reading, covering both manufacturing and services, came in at 30.5 compared to April’s all-time low of 13.6. While considerably better than expectations, the figure remains well below the 50 mark, which separates contraction from expansion.

Henry’omics:

Weakness came on the back of sharp rallies in the major stock indexes so far this week.

However, The S&P 500 (+3.7%), Nasdaq (+4%) and Dow (+3.7%) are up 3.7%, 4% and 3.7% since Monday; that seem to be dependent on the always forthcoming reopening and Moderna’s trial results.

Stock futures fell Thursday morning, giving back some of the gains Wednesday that sent the S&P 500 to its highest level since early March as investors eyed a number of mixed corporate earnings results and economic data releases.

Tensions between the U.S. and China were also escalated, by the Senate passing a bill that could prevent some Chinese firms from listing on U.S. stock exchanges.

What about the Chines funded companies hiding in plain view in the U.S with NASDAQ OTC listings; also filling “not-so-legitimate- quarterly and year-end filings” while control exists in Beijing, China …???

After steep peaks, there are always valleys to slide down into.

Wednesday night’s newsletter’s title:” yesterday’s sector got slam and bammed while the today’s sector got glammed in a snap back.”

• The NASDAQ closed UP +190.67 points (+2.08%);
• Wednesday closed positive at 30/1 and 1 flat;
• Volume was still LOW with 9 out of the 30-upside having higher than the 3-month average volume and 2 out of the 4-downside having higher than the 3-month average volume.
• The percentage (%) of the 30-upside were +0.11% (PSTI) to +14.94% (FIXX) while the 4-downside ranged from -0.08% (VYGR) to -4.95% (CLBS); 
• The IBB closed up +2.06% after Tuesday’s down -1.92% and Monday’s up of +1.16%;
• The XBI also closed up +2.89% after Tuesday’s down -2.85% and Monday’s up of +2.91%;

Q2:

May registered 6 negative, 8 positive closes – so far

• April registered 10 negative, 11 positive closes and 1 holiday.

Q1:

• March registered 11 negative, 10 positive closes and 1 neutral close.
• February registered 9 negative, 9 positive closes, 3 vacation days and 1 holiday.
• January registered 9 negative, 10 positive closes and 2 holidays.

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

Maintaining Sell into strength:

• Athersys (ATHX) closed up +$0.20 after Tuesday’s down -$0.085 and Monday’s +$0.035. SELL into trials which will take time plus a lingering negative includes taking PPP funds from the government while simultaneously raising $57.6 M.
• bluebird bio (BLUE) closed up +$7.27 with 3.069 million shares traded after Tuesday’s +$0.76 and an offering being proposed, it also has a negative -$0.17 or -0.26% aftermarket indication;

BUY after a dip:

• BioLife Solutions (BLFS) closed down -$0.38 after Tuesday’s +$0.59 to 16.47 and Monday’s +$0.53 after reporting earnings with solid revenue and a $20 M investment by Casdin Capital. Can’t argue (sometimes) with a positive +$0.16 or +0.99% aftermarket indication;

SELL, switching sides:

• Adverum Biotechnologies (ADVM) closed up +$1.00 or +5.29% to $19.92 and has a positive +$0.12 or +0.60% aftermarket indication however, the month of May started at $12.00;
• CRISPR Therapeutics (CRSP) closed up +$3.23 to $66.79 after Tuesday’s down -$0.42 and NO aftermarket indication however, the chart looks very “peaky” and the month of May opened at $48.46;
• Intellia Therapeutics (NTLA) closed up +$0.36 after Tuesday’s +$0.74 to $19.44 after Monday’s +$1.31 after hitting a 52-week high which threatens me as to ownership. I bit last night on the IBD article but, anything hitting a 52-week high in a session is suspect. But, NTLA has a +$0.38 or +$1.92% aftermarket indication;
• Regenxbio (RGNX) closed up +$3.65 to $41.94 and has a negative -$0.04 or -0.10% aftermarket indication after an alternating “run” on Tuesday -$1.35 and Monday’s +$1.34)

Maintaining BUY:

• Applied Genetic Technologies (AGTC) closed up +$0.15 after Tuesday’s +$0.02 news and has a positive +$0.20 or +4.60% aftermarket indication;
• Pluristem (PSTI) closed up +$0.01 after Tuesday’s -$0.51 and Monday’s -$0.57 and has a negative -$0.07 or -0.79% aftermarket indication. Traders are “scoring” on taking down PSTI however recent news (which was sold into) highlights an … 87.5% survival rate of patients on invasive mechanical ventilation injected with PLX cells, 75% of patients no longer in need of any mechanical ventilation, 62.5% of the patients discharged alive from the hospital after a 28-day study in PSTI’s recently announced FDA P2 study. A compassionate use program should NOT be underestimated. I’m also a sucker for the oversold;
• Cellectis SA (CLLS) closed up +$0.36 to $19.55 and has a positive +$1.04 or +5.32% aftermarket indication. I’d ride the upside and the SELL as 5/13 saw $13.70 and started the month of may at $12.06;

The BOTTOM LINE: It’s still a sector of musical chairs regarding the rise and fall of share pricing.

Reiterating, “Some sector stocks look fatigued and, in some cases, injured, however, it’s always about fundamentals, cash positions, runways and platforms whether there used as tools or not.” <Henry>

“U.S. stocks have rallied sharply since the March tumble, millions are unemployed, and the most vulnerable people in the economy have been hit hardest as equity investors are hoping for an outcome where fiscal policy is eased by enough to eventually restore full employment while interest rates stay low well beyond that point in order to induce the private sector to keep spending: A win-win combination for stocks.”<MarketWatch>

But my trigger finger gets itchy with sessions that scratch highs as the S&P 500 (+3.7%), Nasdaq (+4%) and Dow (+3.7%) were up since Monday. The S&P 500 and Dow are both on track for their best weeks since the week ended April 8.

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.