September 6, 2022 5:19pm
As Fed worries persist while any cell and gene therapy sector financing options dissolve
Pre-open indications: 3 HITs and 4 MISS
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?
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 -173.14 points (-0.55); the S&P closed DOWN -16.07 points (-0.41%) while the Nasdaq closed DOWN -85.95 points (-0.74%)
indexes slipped on Tuesday as a stronger-than-expected reading on the U.S. services sector fell with expectations that the Fed will keep raising interest rates to tame inflation.
The Nasdaq experienced its seventh (7th) consecutive day of losses in what could be its longest such losing streak since November 2016.
Right-on quote, “the primary concern by far, for almost everyone, is really just what's going to happen with the Fed and interest rates," said Randy Frederick, VP of trading and derivatives for Charles Schwab in Austin, Texas.
Economic Data Docket: a survey from the Institute for Supply Management (ISM) showed the U.S. services industry picked up in August coming-in at 56.9 from 55.5 for the second straight month amid stronger order growth and employment, while supply bottlenecks and price pressures eased. However, numbers from S&P Global showed services sector PMI fell short of flash estimates for August. <Reuters>
- The markets and sector's eyes will be on Fed Chair Powell's speech on Thursday as well the U.S. consumer prices data next week for clues on the path of monetary policy.
RegMed Investor’s (RMi) Pre-Open: “Warning, cell and gene therapy sector equities! Are we sleep-walking into “crunches” in cash utilization, platform priority and employment cut-backs? Some companies are!” … https://www.regmedinvestors.com/articles/12590
RegMed/Stem/Cell and Gene Therapy’s 35 covered equities’ Advance/Decline (A/D) lines: what happened …
- Tuesday’s advance/decline line opened negative at 9 up/ 22 down and 4 flats, stayed negative with 7 up/26 and 2 flats down at the mid-day, ending with a negative close of 8/25 and 2 flats.
- Monday was a holiday
Pre-open Indications: 3 HITs <Biostage (BSTG $0.00 with 34 shares traded), BioLife Solutions (BLFS +$0.66), Caribou Biosciences (CRBU +$0.44)> 4 MISS < Fate Therapeutics (FATE -$1.42), Intellia Therapeutics (NTLA -$0.64), Verve Therapeutics (VERV -$0.41), Beam Therapeutics (BEAM +$0.25)
Key Metrics: low volume pervades …
- Tuesday - Sector volume was LOW with 2 of the 8-upside having higher than the 3-month average volume with LOW volume of 3 of 25-downside having higher than the 3-month average volume
- Monday – was a holiday
The iShares NASDAQ Biotechnology (IBB) and the SPDR S&P ETF (XBI) indicators:
- Tuesday, the IBB was down 1.36% and the XBI was down -2.85%
- Monday was a holiday
The CBOE Volatility Index (VVIX: INDEX) tracked:
- Tuesday was up +0.92 points or +3.54% at 26.91
- Monday was a holiday
Jumping with share pricing momentum (8 of 8):
- BioLife Solutions (BLFS +$0.66),
- Caribou Biosciences (CRBU +$0.44),
- AxoGen (AXGN +$0.33),
- Beam Therapeutics (BEAM +$0.25),
- Global Blood Therapeutics (GBT +$0.08),
- Solid Biosciences (SLDB +$0.0335),
- Applied Genetic Technologies (AGTC +$0.012),
- Bellicum Pharmaceuticals (BLCM +$0.01),
- Biostage (BSTG) and Homology Medicine (FIXX)
Closing down (10 of 25):
- Alnylam Pharmaceuticals (ALNY -$4.19),
- Regenxbio (RGNX -$2.70),
- Fate Therapeutics (FATE -$1.42),
- UniQure NV (QURE -$1.16),
- Sage Therapeutics (SAGE -$1.14),
- CRISPR Therapeutics (CRSP -$0.98),
- Chinook Therapeutics (KDNY -$0.87),
- Ultragenyx (RARE -$0.75),
- Intellia Therapeutics (NTLA -$0.64),
- Editas Medicine (EDIT -$0.53),
- Tuesday closed negative with 8 incliner, 25 decliners and 2 flats
- Monday was a holiday
- Friday closed negative with 8 incliners, 26 decliners and 1 flat (BSTG)
- Thursday closed positive with 22 incliners, 12 decliners and 1 flat (BSTG)
The BOTTOM LINE: I try to keep it simple … and short!
What has changed … NOTHING, the conviction spiral continues as sentiment is in the toilet.
As I have further questioned, “The real question that should be asked is how many companies are at the end of sentiments leash? Start by looking at cell and gene therapy companies trading below cash!”
Companies NEED transparency and advantage of good practices in relation to outreach to investors which means … NOT to enrich themselves at shareholder’s expense!
CEO salaries, spending the G&A are totally OUT-OF-WHACK; these are companies are in the development stage and will be for years without products in most cases not like the tech companies, who CEOs and management teams think they should be compared to for bi-weekly cash and “beanies”!
When it comes time to invest or even hold onto an investment; I’d say … focus on what percentage ownership of stock … NOT options CEOs and management teams own versus their salary and bonus.
Also, investors can’t afford the outsized valuation price targets by I-Banks research and believe that CEOs are “accomplices” to over-estimating expectation and guidance in regard to valuation
I find it very interesting to evaluate share price over earnings and a shortage of revenue reporting as a proxy for share pricing performance?
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.