August 3, 2020 7:58am
“Doing the same thing over and over again” and yet we expect market’s and sector’s appreciation?
Q2 Earnings: this week – 12 of 35 <Aduro Biotech (ADRO) today>
Pre-open indications: 2 HITs and 3 SELL <Biostage (BSTG) Chronicles offer a warning>
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Dow futures are UP +0.36% (+94 points), S&P futures are UP +0.52% (+17 points) and NASDAQ futures are UP +0.99% (+108 points)
Indexes are appreciating focusing a positive open as investors turn their attention to Washington’s debate over COVID-19 relief stimulus and the staggering economy;
European stocks jumped as more corporate earnings were released, while U.S. lawmakers attempt to “stimulate” a stalled coronavirus aid package as the pan-European Stoxx 600 climbed 0.5% around 90 minutes into the session,
Asia Pacific were mixed as U.S.-China tensions continue to heat up. In Japan’s Nikkei jumped while the Topix index advanced and Mainland Chinese stocks were higher as a private survey released Monday showed China’s manufacturing activity expanded in July.
Henry’omics:
Monday’s gains come after a mostly positive week on Wall Street and blowout earnings reports from some of the nation’s largest consumer technology companies.
Investors are hoping a vaccine keeps a “floor” under this market, beyond that, what will be the catalysts this quarter if any?
There are 200 vaccines under development, and none is guaranteed to be injected into the arm in the short-term, HIV still no vaccine.
Friday night’s post title – “squeezing the sector’s tooth-paste tube of any gains”
- The NASDAQ closed UP +157.46 points (+1.49%);
- The IBB closed down -1.93% and XBI also closed down -2.35%
- Sector volume was MIXED with 5 of the 7-upside having higher than the 3-month average volume and 4 out of the 27-downside having higher than the 3-month average volume;
- The CBOE Volatility Index (VVIX: INDEX) was down -0.30 points or -1.21% at 24.46;
- Friday’s percentage (%) of the 7-upside were +0.72% (RARE) to +19.05% (BSTG) while the 27-downside ranged from -0.21% (BLFS) to -5.67% (FIXX);
Last five (5) sessions:
- Last Friday (7/31) closed negative with 7 advancers, 27 decliners and 1 flat
- Thursday closed positive with 24 advancers, 8 decliners and 3 flats
- Wednesday closed negative with 9 advancers, 25 decliners and 1 flat
- Tuesday closed negative with 6 advancers, 27 decliners and 2 flats
- Monday (7/27) closed positive with 22 advancers, 11 decliners and 2 flats
Q2 so far: July -11 positive and 11 negative closes with 1 holiday
Companies in my headlights – It’s your decision; I provide an idea and context:
Maintaining Sell:
Biostage (BSTG) closed up +$0.40 on a 1000 share trade after Thursday’s -$0.49 to $2.10, Wednesday’s -$0.01. On March 25, it was priced at $4.30, April 1st at $4.20, May 1st at $3.35, June 1st at $2.61, July 1st at $2.51 – so what does the price hold for the future? … Under $1.00 after ALL the private placement millions of shares are calculated into the outstanding share numbers versus the float.
The Q2 earnings’ (LPS <loss-per-share> report is being prepared. Do the accounts payable and (outstanding) liabilities’ accounts reflect legitimate “numbers” and the TRUE nature of the “STATUS” of the company, where is the accounting for the approved past billing of a number of consultants and the accounting of the final billing of $429,500.00 of the “GIFT” to Connecticut Childrens’ where the pre-clinical development is being done.
It also seems many pre Q1 bills have been … “LOST” after their approval of the Chairman, Jason Chen, WHY is Mrs. bin ZHOU NOT being made aware of these issues?
I am still left wondering WHY – a VP of Finance walks away pre his resignation date without notice, followed by the controller in four (4) days with one (1) week notice and to top it off – NO preparation for the accounting firm, RMS audit in last year’s closing accounting reviews. And then reappears as a consultant?
WHY hasn’t the accounting firm, RMS stepped-up about these many issues – WHY NOT? They have a specific responsibility to identify deficiencies in the operations through their audits? Maybe the SEC can help answer the question?
Public shareholders deserve accountability or do they according to Biostage (BSTG)?
Also WHY was review of the massive IT costs from 2019 – was STOPPED from identifying cost outlays that were NOT addressed. A review was enabled to achieve serious cost and overhead savings of IT and computer processing needs – that was suddenly stopped after identification by a digital forensic specialist ?
Facts are irrefutable and the First amendment of the U.S. Constitution protects American’s free speech.
These issues NEED to be transparent … also do these events constitute a need of oversight by regulatory bodies like the SEC and Mass Secretary of State enforcement division.
Mrs. bin Zhou, as the major stocker holder and head of DST Capital, BSTG’s funder: WHY are you not overseeing the disorder wreaked by the current and latest “exceptions” of a so-called management team?
More SELLs …
Editas Medicine (EDIT) closed down -$1.27 to $29.36 with a 52-week change of +22.69% and has a negative -$0.35 or -1.19% aftermarket (Friday) indication as earnings are due this week;
Pluristem (PSTI) closed up +$0.65 to $9.80 and has a negative -$0.04 or -0.41% aftermarket indication. I LIKE PSTI however, most pricing inclines are usually met with resistance’
BUY:
Homology Medicine (FIXX) closed down -$0.79 to $13.15 and has a positive +$0.65 or +4.945 aftermarket (Friday) indication;
Mesoblast (MESO) closed down -0.23 to $13.42 and has a positive +$0.37 or +2.76% aftermarket (Friday) indication. 7/30 news, the independent Data Safety Monitoring Board (DSMB) has set a date for early September to complete the first interim analysis of the P3 trial of remestemcel-L in ventilator dependent COVID-19 patients with moderate to severe acute respiratory distress syndrome (ARDS). The trial’s first 90 patients will have completed 30 days of follow up during August, after which the DSMB will perform an interim analysis review of the safety and efficacy data. The DSMB will then inform Mesoblast on whether the trial should proceed as planned, or should stop early. There are currently no approved treatments for COVID-19 ARDS, the primary cause of death in patients infected with COVID-19. Also, The Oncologic Drugs Advisory Committee (ODAC) of the FDA has scheduled a meeting for August 13, 2020 to review data supporting the Biologics License Application (BLA) for approval of RYONCIL in the treatment of steroid-refractory acute graft versus host disease (SR-aGVHD) in children;
The BOTTOM LINE: I usually don’t invest in an earnings’ laden week waiting for the pre and post reporting effects!
After the hop-scotch week and the July’s roller-coaster month, who is willing in their right mind to be LONG – the “boulders are weakening on “Sentiment Mountain”!
Earnings’ start jumping this week, expectation versus forecasts will be the theme of Q2’s LPS (loss-per-share) season.
The first full week of August brings more … Aduro Biotech (ADRO) - today; AxoGen (AXGN), Cellectis SA (CLLS), Sangamo Therapeutics AGMO), Fate Therapeutics (FATE), Global Blood Therapeutics (GBT), Ionis Pharmaceuticals (IONS) on 8/5, Alnylam Pharmaceuticals (ALNY), Regenxbio (RGNX), Editas Medicine (EDIT) Bellicum Pharmaceuticals (BLCM), Intellia Therapeutics (NTLA) on 8/6.
Insight is about understanding perception and putting into context what is relevant to expectation fulfillment.
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.
