September 23, 2020 7:50am

Profit from your portfolio and make a buck or two (2), maybe three (3) – good for your financial health

The real concern, the economic recovery being totally contingent on getting the virus under control

Pre-open indications: 2 BUYs and 6 SELLs

What I provide is an “intelligence daily” to ensure that shareholders are kept apprised based on a 24-hour surveillance of “our” universe, the RegMed/cell and gene therapy sector and its surrounding markets. Subscription is coming, it’s not conscription but, an offer to join our collective of like-minded investors!

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Dow futures are UP +0.77% (+208 points), S&P futures are UP +0.41% (+14 points) and NASDAQ futures are UP +0.17% (+19 points)

 

U.S. stock futures were solidly higher again early Wednesday after Johnson & Johnson starting a P3 trial of its coronavirus vaccine and the House passing a bill avoiding a government shutdown which followed the S&P 500 experiencing its first positive day in five trading sessions;

European stocks climbed as investors reacted to key data releases from the euro zone with the pan-European Stoxx 600 gaining +1.1% in early trade,

  • Euro zone business activity growth slowed in September, with IHS Markit’s preliminary euro zone composite purchasing manager’s index (PMI) reading coming in below expectations at 50.1, down from 51.9 in August. A reading above 50 represents expansion. Spain revised its second-quarter GDP (gross domestic product) contraction to 17.8% quarter-on-quarter, less severe than the initial estimate of 18.5%.

Asia Pacific stocks were mixed in overnight trade as investors reacted to recent comments from Fed Chair Powell on Tuesday.

  • Australia led gains, jumping more than +2%. Stocks in Japan were edged lower on their first trading day of the week following holidays on Monday and Tuesday. The MSCI Asia ex-Japan index advanced +0.18%.

 

Data Docket: After a brief lull, mortgage demand surged ahead yet again even with the highest interest rates in several weeks. Mortgage applications to purchase a home rose just 3% for the week but were 25% higher from a year ago. Total mortgage application volume increased 6.8% last week from the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index.

 

Henry’omics:

How much of these equity movements are motivated by “fear or missing out” (FOMO)? There are still a number of sessions left in September and a squalid Q3.

Shares of scientific and technology stocks which have all suffered in September closed in positive territory on Tuesday.

Optimism is NOT a fundamental factor but an emotional influence …!

 

Tuesday night’s post: RegMed Investors’ (RMi) closing bell:

  • The Nasdaq closed UP +184.84 points (+1.71%);
  • The IBB closed up +0.76% and XBI closed up +0.62%
  • Sector volume was NEGLITABLE with 2 of the 20-upside having higher than the 3-month average volume and PRONOUNCED with the 3 of 13-downside having higher than the 3-month average volume;
  • The CBOE Volatility Index (VVIX: INDEX) was down -0.92 points or -3.31% at 26.86;
  • Tuesday’s percentage (%) of the 20-upside was +0.07% (BCLI) to 5.25% (FIXX) while the 13-downside ranges from -0.31% (FATE) to -13.22% (BSTG); 

Q3 so far:

  • September, 6 positive closes, 9 negative closes and 1 holiday
  • August, 10 positive closes and 11 negative closes
  • 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 down Tuesday’s -$0.23 to $1.51 after Monday’s +$0.19 to $1.74, Friday’s +$0.05 to $1.55, Thursday’s +$0.09 and last Wednesday’s -$0.14 to $1.41. Question#1: What company refuses to “illuminate” public shareholders of their status after almost $85+ million has gone into the company in seven years?

Maintaining BUY:

bluebird bio (BLUE) closed up +$1.08 to $55.58 following Monday’s -$2.16 on (Tuesday’s) news of Bristol Myers Squibb (BMY) and BLUE announcing the U.S. FDA has accepted for Priority Review their Biologics License Application (BLA) for idecabtagene vicleucel (ide-cel; bb2121), the investigational B-cell maturation antigen (BCMA)-directed chimeric antigen receptor (CAR) T cell immunotherapy, for the treatment of adult patients with multiple myeloma who have received at least three prior therapies, including an immunomodulatory agent, a proteasome inhibitor and an anti-CD38 antibody. The FDA has set a Prescription Drug User Fee Act (PDUFA) goal date of 3/27/21. BLUE has a positive +$0.42 or +0.76% aftermarket indication;

Athersys (ATHX) closed down -$0.10 to $1.97 and has a positive +$0.29 or +14.72% pre-market indication on news of MultiStem® cell therapy was granted Regenerative Medicine Advanced Therapy (RMAT) designation from the U.S. FDA for the acute respiratory distress syndrome (ARDS) program. The RMAT designation enables sponsors to work closely with the FDA and receive their guidance on expediting development of their products, including providing advice on generating the evidence needed to support approval in an efficient manner. RMAT designation invites the Company to schedule a Type B meeting with the FDA to discuss multidisciplinary strategic development plans, including expediting manufacturing development for commercialization to support priority review and/or accelerated approval.

SELL into Strength:

AxoGen (AXGN) closed up +$0.28 to $12.57 after Monday’s $12.29 following last Friday’s $13.12, Thursday’s $12.56 and last Wednesday’s $12.88 post the previous Tuesday’s $10.75 and has a negative -$0.22 or -1.74% aftermarket indication;

BioLife Solutions (BLFS) closed up +$0.58 to $26.98 after Monday’s $26.40, last Friday’s $27.21, Thursday’s $25.43 and the previous Wednesday’s $25.80 and has a negative -$0.39 or -1.46% aftermarket indication. BLFS had news of entering into a definitive agreement to acquire SciSafe, a privately held multi-facility provider of biological materials storage to the cell and gene therapy and pharmaceutical industries. The transaction is expected to close on September 30th for $15 million upfront and stock worth $15 million. Depletes the cash position and heightens the outstanding shares for a $1.8 million in additional quarterly (Q4) revenue?

SELL into Strength from BUY;

Mesoblast (MESO) closed up +$0.77 to $18.14 after Monday’s -$0.51 to $17.37 and has a positive +$0.35 or +1.93% aftermarket indication. A 52-week change of +159.25% and a “slippery slope” chart;

Maintaining SELL into Strength:

CRISPR Therapeutics (CRSP) closed up +$3.68 to $88.61 after Monday’s -$0.77 to $85.13 and has NO aftermarket indication. CRSP) and Vertex Pharmaceuticals (VRTX) had announced the European Medicines Agency (EMA) granted Priority Medicines (PRIME) designation to CTX001, an investigational, autologous, ex vivo CRISPR/Cas9 gene-edited therapy for the treatment of severe sickle cell disease (SCD).However, a 52-week change of +85.27% and a 7.72% short of float position makes one think of selling “some” for profit before the algorithms hit it;

Sage Therapeutics (SAGE) closed up +$1.97 to $61.85 after Monday’s $59.88 and last Friday’s $62.45 following the previous Thursday’s $60.10 and Wednesday’s $59.14 and has a negative -$0.51 or -0.82% aftermarket indication;

 

The BOTTOM LINE: New highs after a pummeling scare me during these September sessions <6 positive closes, 9 negative closes and 1 holiday> as the quarter (Q3) will soon come to an end.

September continues to be a weak month for stocks with all three averages posting three (3) straight weeks of losses with the Nasdaq down -6.9% already this month.

The path to the next, of the next and the future new normal is likely to be bumpy amid uncertainty over the coronavirus, the US political environment, and US-China tensions.

 

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.