July 14, 2022 4:46pm
The curse of the public listing – uncontrolled volatility as investors don’t seek discounted equities
Pre-open indications: 4 MISS, 5 HiTs and 1 Puff/pump/Promote
News: Ultragenyx Pharmaceutical (RARE -$1.26) sold 30% of the company’s royalty interest from Kyowa Kirin Co., Ltd on the future sales of Crysvita® (burosumab) in the U.S. and Canada to OMERS, one of Canada’s largest defined benefit pension plans, for $500 million. OMERS’ right to receive royalty payments is based on net sales of the product beginning in April 2023 and total payments are capped at 1.45 times the purchase price.
WHY and HOW is this market affecting the cell and gene therapy sector … “The Bottom Line” underlines the framework of share pricing actions. Who else is tracking a broad grouping of cell and gene therapy equities – can you afford to not read facts supported by real numbers?
No tunnel vision here, I get into the weeds of share pricing
If I have learned one thing as a former research analyst, venture and public fund investor now a journalist; it is that your life and your bank account are largely tied to your knowledge of price movements and questioning pricing targets.
The Dow closed DOWN -142.78 points (-0.46%); the S&P closed DOWN -11.53 points (-0.30%) while the Nasdaq closed UP +3.60 points (+0.03%)
Indexes tumbled Thursday although they've pared losses over the last hour and are off lows of the day while the Nasdaq barely rose.
Bank earnings kicked off with disappointing results as traders assessed the possibility of even tighter U.S. monetary policy on the back of June’s inflation data.
Investors have turned increasingly nervous that the Fed's efforts to tackle soaring prices with aggressive interest rate increases could tip the economy into a recession. <Reuters>
Economic Data Docket: June’s producer price index report, which measures prices paid to producers of goods and services, showed wholesale prices rise 11.3% versus a year ago last month as energy prices jumped.
· Excluding food, energy and trade, core PPI was up 6.4%. The monthly gain of 0.3% was below expectations.
· Jobless claims jumped to 244,000 last week, the highest level since November 2021.
RegMed Investor’s (RMi) Pre-Open: “ticks will be under pressure. I am still waiting for the “UGLY” as the Pacman algorithms are getting hungry looking at the appreciation in many cell and gene therapy equities” … https://www.regmedinvestors.com/articles/12516
RegMed/Stem/Cell and Gene Therapy’s 35 covered equities’ Advance/Decline (A/D) lines: what happened …
- Thursday advance/decline line opened negative at 9 up/ 25 down and 1 flat, stayed negative with 8 up/26 and 1 flat at the mid-day, ending with a negative close of 12/21 and 1 flat.
Pre-open Indications: 5 HITs < Alnylam Pharmaceuticals (ALNY -$4.16), Editas Medicine (EDIT -$1.07), Ionis Pharmaceuticals (IONS -$0.54), Ultragenyx (RARE -$1.26), Verve Therapeutics (VERV -$0.97)> 4 MISS < Beam Therapeutics (BEAM +$0.53), Chinook Therapeutics (KDNY +$0.06), CRISPR Therapeutics (CRSP +$1.21), Fate Therapeutics (FATE +$0.22)> and 1 puff/Pump/Promote < Biostage (BSTG +$0.12 with 420 shares traded>
- Thursday - Sector volume was LOW with 2 of the 12-upside having higher than the 3-month average volume with LOW volume of 4 of 21-downside having higher than the 3-month average volume;
The iShares NASDAQ Biotechnology (IBB) and the SPDR S&P ETF (XBI) indicators:
- Thursday, the IBB was down -1.68% and the XBI was down -2.28%
The CBOE Volatility Index (VVIX: INDEX) tracked:
- Thursday was down -0.44 points or -1.64% at 26.38
Jumping with share pricing momentum (12 of 12):
- CRISPR Therapeutics (CRSP +$1.21 after Wednesday’s +$1.65 after Tuesday’s +$5.34 and Monday’s -$2.99),
- Beam Therapeutics (BEAM +$0.53 after Wednesday’s +$2.71, Tuesday’s +$2.43 and Monday’s -$1.56),
- Regenxbio (RGNX +$0.47 after Wednesday’s +$0.67 and Tuesday’s +$1.65),
- Intellia Therapeutics (NTLA +$0.39),
- Fate Therapeutics (FATE +$0.22 after Wednesday’s +$1.51),
- Caribou Biosciences (CRBU +$0.14),
- Biostage (BSTG +$0.12 after Wednesday’s +$1.33 after Tuesday’s +$0.03 and Monday’s -$1.189),
- Sage Therapeutics (SAGE +$0.09 after Wednesday’s -$0.32),
- Bellicum Pharmaceuticals (BLCM +$0.06 after Wednesday’s -$0.05 and Tuesday’s -$0.07),
- Chinook Therapeutics (KDNY +$0.06 after Wednesday’s +$0.92 and Tuesday’s -$0.02),
- Mesoblast (MESO +$0.02),
- Solid Biosciences (SLDB -$0.0073),
Closing down (10 of 21):
- Alnylam Pharmaceuticals (ALNY -$4.16 after Wednesday’s -$3.15, Tuesday’s -$5.06 and Monday’s -$1.58),
- Ultragenyx (RARE -$0.82 after Wednesday’s -$0.03 and Tuesday’s -$0.01),
- Editas Medicine (EDIT -$1.07 after Wednesday’s +$1.75, Tuesday’s +$0.57 and Monday’s -$1.18),
- uniQure NV (QURE -$0.98 after Wednesday’s +$0.96 and Tuesday’s +$0.55),
- Verve Therapeutics (VERV -$0.97 after Wednesday’s +$2.97 and Tuesday’s +$1.72),
- Vericel (VCEL -$0.85),
- Global Blood Therapeutics (GBT -$0.60),
- Ionis Pharmaceuticals (IONS -$0.54 after Wednesday’s +$0.65 and Tuesday’s +$0.46),
- bluebird bio (BLUE -$0.33),
- Voyager Therapeutics (VYGR -$0.28),
- AxoGen (AXGN -$0.27 after Wednesday’s -$0.03),
- Thursday closed negative with 12 incliner, 21 decliners and 1 flat
The BOTTOM LINE: I try to keep it simple … and short!
Knew the decline was coming as gravity played into the spiraling upside of the sector.
As I have been writing, “The cell and gene therapy sector whether we see or know it is getting squeezed in valuations.”
Volume is still low …
AS I WROTE THIS A.M, “I am still waiting for the “UGLY” as the Pacman algorithms are getting hungry looking at the appreciation in many cell and gene therapy equities
Forget waiting for … it’s here on Thursday!
As I have been writing” There is VALUE out there however, it’s about playing or betting the timing of the sector. We are left with choosing to hang on to “our” portfolio position as it is a given that the sector shifts from fierce, sudden sell-offs to gaining altitude or ascending not to its value but, better than it was.
We always need a villain and they are multiplying – the CPI on Wednesday with earnings season on its way.
I am still waiting for the “UGLY” as the Pacman algorithms are getting hungry looking at the appreciation in many equities>
However, the continuing state of volatility confirms fears that I have been expressing these daily and weekly posts.
Earnings’ season is coming, investors NEED to focus on LPS (loss-per-share), collaboration revenues and cash positions i.e., “runways”.
BUILD CASH POSITIONS, the upward spiral will be STRIPPED, maybe NOT all today but, it’s coming.
I stick to my view of anticipating the risks – as my careers focus has been “warning analysis”.
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.
Regulation Analyst Certification (Reg AC): The research analyst primarily responsible for the content of this report certifies the following under Reg AC: I hereby certify that all views expressed in this report accurately reflect my personal views about the subject company or companies and its or their securities. I also certify that no part of my compensation was, is or will be, directly or indirectly, related to the specific recommendations or views expressed in this report.