November 6, 2015 6:31am

 

U.S. stock futures show little change early Friday, as investors hold off from big bets ahead of a much-anticipated jobs report. After a month of pain and fewer gains, many companies in “our” universe look to be stuck in holding-on.

Henry’s “7” Friday picks. Subscription required: http://www.regmedinvestors.com/user/register

 

 

 

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DOW futures are DOWN -0.1% and NASDAQ futures are FLAT at 0.0%

 

U.S. stock futures show little change early Friday, as investors hold off from big bets ahead of a much-anticipated jobs report.  U.S. stocks will end the weekly with gain … if jobs report falls short!

European equities traded lower as global markets await the latest U.S. employment report which could influence the U.S. Federal Reserve's timing on rate hikes.

Share markets in China and Japan charged up to their highest levels since August 21, while the rest of the region faltered ahead of the release of U.S. nonfarm payrolls report that could provide hints to when the Federal Reserve will start to push up interest rates.

 

Data docket: The nonfarm-payrolls report is due at 8:30 a.m. ET.  A strong jobs report is likely to boost bets that the Federal Reserve will raise its interest rate next month. A weak report could spark a more dramatic reaction by financial markets.

 

 

The RegMed sector closed NEGATIVE on Thursday, POSITIVE on Wednesday, Tuesday and Monday following a NEGATIVE close on last Friday.

 

The week is about to end as:

·         Thursday closed NEGATIVE with 29 decliners, 11 advancers and 3 flat

·         Wednesday closed POSITIVE with 12 decliners, 28 advancers and 3 flats following

·         Tuesday closed POSITIVE with 15 decliners, 26 advancers and 4 flats after

·         Monday closed POSITIVE with 1 decliner, 39 advancers and 3 flats

 

 

U.S. stocks closed slightly lower Thursday as investors awaited Friday's key jobs report that could shed light on the timing of a rate hike.

  • Thursday, the major averages fluctuated between positive and negative territory throughout the trading session, struggling to hold opening gains. The indexes are still on track for gains of about 1 percent or more for the week.

The stem, cell and gene therapy RegMed (SCGT&RM) sector stocks finished negative on Thursday. The helium balloon of appreciation is leaking.

  • Seeing “our” universe’s equities absorb “so-so” financial results is encouraging, it means investors had already priced in the negative net losses and loss per share post conference calls!

Small-cap stocks tend to lag behind large-caps in November and December. The bulk of this much-vaunted small-cap advantage comes in the first months of the year, especially January. Why would small-cap relative strength follow this seasonal pattern - because institutional money managers operate under compensation incentives that lead them to favor large-caps as the year comes to a close?

 

 

Friday’s trading indications, stocks to watch:

  • Athersys (ATHX) closed UP +$0.03 to $1.08 after the release of its Q3/15 financial results. The problem is who is the unnamed partner to replace Chugai and Pfizer?  ATHX had closed on Wednesday +$0.01 to $1.05. November so far, October, September and August, July and June have NOT been good for the share price in relation to share pricing in May. Their “naming” process is TOO drawn-out – the issue is the length of time in making it happen - SELL;
  • Applied Genetic Technology (AGTC) closed DOWN -$0.60 to $13.19. AGTC reported <11/5> a Q1/16 net loss of -$9.1 M or -$0.53 per share with $199.3 M in cash, with 17.99 M share outstanding and a float of 7.71 M as 51.15% held by insiders and 52.30% held by institutions yet the short positions fluctuates 3.73 to 3.81%.  I am “surprised” by the constant deflation of the share price as Biogen (BIIB) invested at $20.62. How many times, have I been “hammered” by the BUY ranking – TOO many but I am still a believer – Still a BUY;
  • bluebird bio (BLUE) closed DOWN -$19.79 to 70.36 , a 21.95% drop! After Wednesday’s -$3.49 after being UP +$9.26 to $93.64 on Tuesday following Monday’s +$7.25. Investors were buying up shares of BLUE ahead of the American Society of Hematology (ASH) meeting but abstracts were released on Thursday.  BLUE's shares are far off the high of $194.25 <5/29/15>.  The good news was this: Six of the nine patients who received the Lentiglobin gene therapy treatment haven’t needed blood transfusions since treatment. The length of time since treatment varies from six to 18 months.  But the bad news was that three other patients, who all have a more severe form of the disease called Cooley’s anemia, have needed some blood transfusions since treatment. The level of treatment is still less than the once-a-month transfusions they would have required otherwise. Two-thirds of the patients appear to be cured. The rest are being significantly helped. But because all of the patients haven't been cured, investors drove down BLUE’s stock by 22%.  $901.7 M in cash and a Q3/15 net loss of -$42.9 m or -$1.18 per share has a lot of sway. BLUE’s aftermarket reflects a slow climb back – the stock is UP +$1.04 or +1.48% to $71.40 in the aftermarket - Maintaining BUY to recapture the upside;  
  • Caladrius Biosciences (CLBS) reported <11/5> a Q3/16 net loss of -$11.4 M or -$0.21 per share with $29.4 M in cash, CLBS closed down -$0.06 to $1.31. Total revenues for the third quarter of 2015 increased 43% to $5.9 million when compared with $4.1 M in Q3/14, driven by increases in clinical service revenue at the PCT subsidiary.  R&D expenses decreased 24% to $6.3 M while SG&A expense decreased to $5.1 M. Financial results weren’t as BAD as I had expected – BUY;
  • Capricor (CAPR) closed UP +$0.12 <after being down -$0.07 on Wednesday after being FLAT on Tuesday> to $4.12 with 10.9 K shares traded <3 month average = 23.5 K shares>.   I have been negative since March and more often correct about the inflation and deflation of the share pricing - time after time after time.  There is just TOO much fluctuation with small volume; how does CAPR expect to be ready for a pending offering - Maintaining SELL;
  • Cellectis S.A.  ADR (CLLS) closed UP +$6.27 or +17.91% to $41.28. CLLS reported success in sending a one-year-old baby's incurable leukemia into remission with an "off-the-shelf" gene editing immunotherapy treatment. CLLS treated the girl by infusing her with genetically edited cells at a hospital in Britain. Two months later, she was free of the cancer that had been so aggressive doctors thought she would surely die.  Healthy donor cells were used for the girl's treatment, and that could be the key to someday mass-producing the treatment for off-the-shelf use. Tailoring treatments to each individual patient costs a lot more money, and that's a hurdle “others” will need to address as they approach commercialization. Off-the-shelf treatments help bring down manufacturing costs.  CLLS is UP +$1.22 or +2.96% to $42.50 in the aftermarket – BUY;
  • Cytori (CYTX) closed down -$0.006 to $0.378 after reporting <11/5> a Q3/15 net loss of -$5.8 M or -$0.04 per share with $19 M in cash, On a per-share basis, CYTX had net income of $0.01, losses adjusted for non-recurring gains, were $0.04 per share. Quarterly results included publication of extended follow-up data showing sustained benefit of results in pilot P1/2 trial for scleroderma hand dysfunction.  CYTX also initiated enrollment in two late stage trials for scleroderma hand dysfunction in the US (STAR trial) and Europe (SCLERADEC-II trial).  CYTX posted revenue of $766 K in Q3. One problem is the debt balances of $17.7 M and the second is the effort needed to close the outstanding BARDA initiative. The clock is still running on a NASDAQ issue of being under a $1.00 pricing. With 165.96 shares outstanding and a float of 144.34 m shares – wouldn’t a reverse be in the cards? CYTX is UP in the aftermarket +$0.04 to $0.42, a +10.82% increase.  A BUY for a day, four cents is NOT a reason to jump short-term; it’s then a HOLD until the future unfolds …

 

 

The information included above as well as individual companies and/or securities mentioned should be construed as guidance in RMi reviews.

The facts stated and the opinions given in this publication are based on data and information considered to be reliable and have been carefully worked into my qualitative analyses and prognoses. However, no guarantee can be given as to their fairness, accuracy or completeness.

Henry McCusker, the editor and publisher of RegMed Investors does not hold or have positions in securities referred to in this publication.