February 4, 2025 5:13pm

Volatility is here to stay, sector earnings season is on the horizon

A shortened version … due to personal circumstances

I say today what others won't, so you can do what others can't!

Never leave an investor uninformed!  


VIP: I will be partially unavailable in the week 2/3 – 2/7/25 due my “better half or the babe” underwent successful surgery yet will continue to be hospitalized – say a prayer please!

 

On point, short on words, long on facts and being judicious!

I follow the dictum, quoting Churchill that “short words are best, and the old words when short are best of all.”

 

Tuesday: The Dow closed UP +134.13 points or +0.30%, the S&P closed UP +43.31 points or +0.72% while the Nasdaq closed UP +262.06 points or +1.35%

  • Indexes closed higher

Henry’omics: We need to more than consider the economic environment - rising rates and inflation to comprehend the micro re “our” universe of cell and gene therapy companies

  • Job openings declined more than analysts expected in December, hitting 7.6 million, their lowest level since September.
  • The Chinese government slapped tariffs of up to 15% on U.S. imports of coal and liquefied natural gas and 10% higher duties on U.S. imports of coal and liquefied natural gas and 10% higher duties on crude oil, farm equipment and selected cars, effective Feb. 10. 

Tuesday’s advance/decline line opened with a positive close at the close of 24 incliner, 8 decliners and 3 flats ending with a positive close of 24 incliners, 9 decliners and 2 flats

Metrics:  Tuesday, the IBB was up +0.96%, the XBI was up +1.15% while the VIX was down -1.41 points or -7.57% at 17.21

 

Monday: The Dow closed DOWN -122.75 points or -0.28%, the S&P closed DOWN -45.96 points or -0.76% while the Nasdaq closed DOWN -235.49 points or -1.20%

  • Indexes fell on Monday in reaction to the Trump administration's scheduled tariff rollout against Canada and China, though the major averages pared heavier losses after President Trump said the US would delay duties on Mexican imports by a month.

Henry’omics: We need to more than consider the economic environment - rising rates and inflation to comprehend the micro re “our” universe of cell and gene therapy companies

  • The ISM manufacturing index posted a reading of 50.9%, representing the share of companies reporting growth for the month. That was 1.7 percentage points above the December level and better than the Dow Jones estimate for 50%. It reversed a trend of 26 straight months in contraction as the best number since September 2022. Within the survey, the employment index leaped to 50.3, a gain of 4.9 points, while new orders and production also posted gains. The prices index rose to 54.9%, up 2.4 points.

Monday’s advance/decline line ending with a negative close at the close of 8 incliner, 25 decliners and 2 flats

Metrics:  Monday, the IBB was down -0.81%, the XBI was down -1.25% while the VIX was up +2.19 points or +13.33% at 16.62

 

Q1/25 – February – 1 negative and 1 positive closes

  • January - 2 holidays, 1 market close, 10 negative and 10 positive closes

Q4/24 – December - 1 holiday, 6 positive and 15 negative closes

  • November – 1 holiday, 10 negative and 10 positive closes              
  • October: 8 positive and 15 negative sessions

 

Tuesday’s Closing UP (10 of 24)  

  • Blueprint Medicine (BPMC +$1.90 after Monday’s -$1.03),
  • Ultragenyx Pharmaceuticals (RARE +$0.76 after Monday’s +$0.39),
  • Regenxbio (RGNX +$0.61 after Monday’s -$0.25)
  • Lenz Therapeutics (LENZ +$0.61),
  • Verve Therapeutics (VERV +$0.54),
  • CRISPR Therapeutics (CRSP +$0.49 after Monday’ s -$1.59)
  • Vericel (VCEL +$0.37 after Monday’s +$0.52),
  • Mesoblast (MESO +$0.34),
  • Adverum Biotechnologies (ADVM +$0.21 after Monday’s +$0.04),
  • Voyager Therapeutics (VYGR +$0.20),

Flat (2)

  • Harvard Apparatus RT (OTCQB: HRGN),
  • Homology Medicine (FIXX)

Monday’s Closing DOWN (9 of 9):

  • Alnylam Pharmaceuticals (ALNY -$3.55 after Monday’s +$3.24)
  • Moderna (MRNA -$2.38 after Monday’s -$2.87),
  • Ionis Pharmaceuticals (IONS -$0.49 after Monday’s +$0.23
  • BioLife Solutions -$0.29 after Monday’s -$0.68),
  • Solid Biosciences (SLDB -$0.11),
  • bluebird bio (BLUE -$0.07 after Monday’s -$0.72)
  • Prime Medicine (PRME -$0.06),
  • Sage Therapeutics (SAGE -$0.02 after Monday’s +$0.01),
  • Agenus (AGEN -$0.01 after Monday’s -$0.29),

 

The BOTTOM LINE:  Tuesday’s session closed positive upending Monday's negative close.

I don’t have much to write/say other than “electronic trading and uncle algo” came to visit

  • The tit-for-tat measures raise the risk of an escalation into trade war that would damage both of the world's top two economies. But some on Wall Street see the Chinese response as showing restraint that opens the door to compromise, as seen in the US tariff postponement deals with Mexico and Canada.

Note:

  • Vaccine stocks Moderna (MRNA), Pfizer (PFE), and BioNTech SE (BNTX) all fell following news that Robert F. Kennedy Jr. cleared a key committee vote in his quest to lead the Health and Human Services Department.

 

Earnings are a-comin’ … from Q4/24 and FY24 are due …

  • Alnylam Pharmaceuticals (ALNY)
  • Sage Therapeutics (SAGE) - Tuesday, 2/11
  • Moderna (MRNA) - Friday, 2/14

 

From Henry’omics, “Job openings declined more than analysts expected in December, hitting 7.6 million, their lowest level since September.”

  • New data from the Bureau of Labor Statistics released Tuesday showed there were 7.6 million jobs open at the end of December, a decrease from the 8.15 million seen in November. The November figure was revised higher from the 8.01 million open jobs initially reported. Economists surveyed by Bloomberg had expected Tuesday's report to show 8 million openings in November. The Job Openings and Labor Turnover Survey (JOLTS) also showed 5.46 million hires were made during the month, down from the 5.37 million made during November. The hiring rate was flat at 3.4% for the third straight month. Also in Tuesday's report, the quits rate, a sign of confidence among workers, was 2% in December, unchanged from the month prior.

 

February ‘25: understand the “flow” …

  • 2/4 - Tuesday ended with a positive close at the close of 24 incliner, 9 decliners and 2 flats
  • 2/3 – Monday - ended with a negative close at the close of 8 incliner, 25 decliners and 2 flats

 

Pfizer (PFE) reported Q4/2024 adjusted earnings per share of $0.63 cents, which beat the Zacks Consensus Estimate of $0.48 cents per share. The company had recorded earnings of $0.10 cents per share in the Q4/23.

  • Revenues came in at $17.76 billion, up 22% from the year-ago quarter on a reported basis. Revenues reflected an operational increase of 21% and a positive currency impact of 1%. Total revenues also beat the Zacks Consensus Estimate of $17.5 billion.
  • Higher sales of Pfizer’s key non-COVID products like Vyndaqel and Eliquis and newly acquired products from Seagen, coupled with higher Paxlovid sales, drove the top line in the quarter. However, sales of some key drugs like Prevnar, Xeljanz and Ibrance and new RSV vaccine, Abrysvo declined in the quarter.
  • Pfizer's COVID revenues include direct sales and alliance revenues from its partner, BioNTech BNTX, for Comirnaty and product revenues from its oral antiviral pill for COVID-19, Paxlovid.  Excluding revenues from COVID products, sales rose 11% operationally in the fourth quarter.
  • International revenues declined 12% on an operational basis to $8.54 billion. U.S. revenues rose 88% to $9.22 billion.
  • Adjusted selling, informational and administrative (SI&A) expenses declined 4% (operationally) in the quarter to $4.28 billion. Adjusted R&D expenses rose 8% to $2.99 billion.

 

As I have written “Many sector companies are engaged in cost realignment programs, which won’t be realized consequences over the next few Qs where the operating expense levels; spending on SG&A (selling, informational, and administrative) and R&D (research and development) facilitate the need to extend runways and enable expectation of clinical innovations.”

  • "I think the market's going to come back to earnings, the first couple of months of 2025, and 1st H/25 will be a shifting cell and gene therapy sector due to earnings releases... I still believe stocks will swing upward pre and them more post releases

Big Point to remember “Think about it; the biggest problem the cell and gene therapy sector it’s all to the future …  99% of them have no earnings!

  • If rates are higher for longer, that means that sector companies will continue to struggle or be unable to raise capital and therefore be subject to debt servicing firms!”
  •  2024 saw very little life IPOs (initial public offering) market and secondaries – I have seen private investments, mortgages, sell-offs, as companies deferred and struggle to gain further market access i.e., public. <Me>

What could 2025 have in store for the capital access space?

  • "You'll see a number of cell and gene therapy comandantes drive for secondaries – they’re desperate for cash, but I do think a lot of cell and gene therapy sector companies NEED to be focused on what is driving their own growth —they're focused on a lot of change BUT … that's happening in pipelines … capital expansion is second.

 

Why do I keep repeating, so investors can make the connection …

The top three (3) performing in the session:    

  • Tuesday: Blueprint Medicine (BPMC), Ultragenyx Pharmaceuticals (RARE) and Regenxbio (RGNX)
  • Monday: Alnylam Pharmaceuticals (ALNY), Vericel (VCEL) and Ultragenyx Pharmaceuticals (RARE

The worst three (3) in the session: 

  • Tuesday: Alnylam Pharmaceuticals (ALNY), Moderna (MRNA) and Ionis Pharmaceuticals (IONS)
  • Monday: Moderna (MRNA), CRISPR Therapeutics (CRSP) and Verve Therapeutics (VERV)

Welcome to my world of defining the “grey’ in our universe!

  • Right up front, “I also hate to be so negative or contrarian but, this is a NO spin zone and facts are its product; I can always be WRONG but … I am mostly EARLY!”

 

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 it’s 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.