November 18, 2015 6:38am

 

A rough November, I expect a slow rebound as “our” universe is stuck in an atmosphere of low temperature and held in place by gravity as Advance/Decline Lines <A/DL> tighten and indexes are determined by the market’s terrain!

Henry’s lucky “10” Wednesday trading picks?  Subscription required: http://www.regmedinvestors.com/create-account

 

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

 

DOW futures and NASDAQ futures are DOWN -0.2%

 

 

U.S. stock futures drifted lower on Wednesday as investors braced for a set of minutes from the latest Federal Reserve meeting that could firm up expectations for an interest-rate increase at the central bank’s December meeting.

European stocks fell, with travel shares under pressure as police in Paris carry out a raid connected to last week’s terror attacks.  The Stoxx Europe 600 SXXP, -0.58%  was down 0.5% to 377.89, with all sectors in the red. The index on Tuesday had jumped 2.9%, to mark the best daily gain in six weeks as shares of defense and energy companies advanced. But equities pulled back on Wednesday as investors took in news of a manhunt underway in suburban Paris as police tried to corner the suspected mastermind of last week’s attacks. A woman blew herself up and a man was killed in the operation, and at least two people have been detained.

Asian shares traded mixed on Wednesday, as investors remain cautious over the latest global geopolitical developments in the wake of Paris terror attacks.

 

Data docket: Caution for investors was also setting in ahead of minutes due from an October Fed meeting, to be released at 2 p.m. ET. Ahead of that, weekly jobless claims and the Philadelphia Fed’s manufacturing survey are due at 8:30 a.m. ET. New York Fed President William Dudley, Cleveland Fed President Loretta Mester and Atlanta Fed President Dennis Lockhart will appear on a panel at the Clearing House annual conference in New York at 7:30 a.m. ET. Dallas Fed President Rob Kaplan will give a speech on economic conditions and Fed policy at the University of Houston at noon ET.

 

 

The RegMed sector closed NEGATIVE on Tuesday, NEUTRAL on Monday, NEGATIVE on Friday, Thursday and last Wednesday.

Tuesday closed NEGATIVE with 23 decliners, 18 advancers and 2 flats following Monday’s NEUTRAL close with 20 decliners, 20 advancers and 3 flats in relation to “our” coverage universe of 43 companies.

 

 

What goes up goes down alternating days - directionless and without substance and fewer event orientations!

  • Reversals thrived defined with less expectation, while support is still lackluster preserving a slight bias!

While the subsequent downturn of the stem, cell and gene therapy (SCGT&RM) sector has been irrespective of “names”; the NASDAQ has thus far maintained support at 4,927, matching the bottom of the October gap.

  • But is the sector a BUY in these sell-offs?   I’d be playing the odds of pricing history, clinical status and partners!

The bed was soiled on Tuesday by shares of Cesca Therapeutics (KOOL-48.97% or +$0.29), Osiris (OSIR -21.53% or -$3.01), BioLife Solutions (BLFS-3.46% or -$0.08), Histogenics (HSGX -6.42% or -$0.24), Opexa (OPXA -3.54% or -$0.11) and  Vericel (VCEL -3.39% or -$0.06) were savaged <Tuesday> which reflected a growing awareness of changing sentiment as investors in some cases sell into strength or just cut and run or in VCEL’s case in the middle of an offering?

  • Better to be flat than be a splat – Ocata Therapeutics (OCAT at $8.46) was sold to Astellas Pharma and VistaGen (VSTA at $6.00).

Granted the gift of re-life was bluebird bio (BLUE +6.93% or +$5.16), Mesoblast (MESO +2.92% or +$0.20) having closed up after being down --15.54% or -$1.26 on Monday, Fate Therapeutics (FATE +5.31% or +$0.22) – chirps along with the periodic hit by traders, Aduro Biotech (ADRO +4.49% or +$1.24) – another “black box” and Regenxbio (RGNX +4.31% or +$0.92) – which I still believe is a trading tool with Cellectis (CLLS +2.81% or +$0.97) shooting higher – which I still feel will be “scooped” by a pharma

  • Indexes to consider, the iShares Trust - iShares Russell 2000 ETF (IWM)  closed down -0.38% and is up in the pre-market while the iShares Trust - iShares Nasdaq Biotechnology ETF (IBB) closed up +1.31% - feeling the love.  Or are we about to be on a roll as the sector was down <A/DL = 14/24> at the open, up in the mid-day <A/DL= 24/17> closing down <A/DL = 18/23> as the spreads are tighter indicating a slowing decline – I think so?

 

 

Wednesday’s --- trading indications, stocks to watch:

  • Applied Genetics Technologies (AGTC) closed DOWN -$0.10 <after Monday’s +$0.08> to $15.90 on 267.3 K share volume <3 month =136.1 K shares>. Do I feel the upside considering Biogen (BIIB) invested at $20.62 – how many times can one say it!  AGTC is presenting at the Stifel conference in NYC today on the 18th, Maybe they might just rouse the audience – Maintaining BUY;

  • bluebird bio (BLUE)closed UP +$5.16 to $79.61 and is up +$1.34 in the after-market. Reiterating from last night’s closing wrap-up, shares of BLUE soared higher Tuesday after releasing updated abstract data in advance of the American Society of Hematology Annual Meeting that caused a handful of analysts to reaffirm their bullish outlook on the company's stock. BLUE released data yesterday related to its ongoing preclinical oncology work with its collaboration partner Celgene (CELG), giving investors their first look at how the experimental anti-BCMA CAR therapy performs in patients with myeloma. BLUE and CELG's anti-BCMA therapy was able to generated a positive response or keep the diseases stable in several of the patients who are using treatment, which is a promising sign when considering that the patients who are using the therapy had previously used an average of 7 other treatments before giving bluebird & Celgene's therapy a go - BUY;
  • Capricor (CAPR) closed DOWN -$0.03 to $3.99 <having been up +$0.05 on Monday> at $3.99 with 50.1 K shares traded <3 month average = 20.5 K shares>.  So, why again is the chairman being paid so much ($10 K a month) to “manage” the CEO? I have been negative since March and more often correct about the inflation and deflation of the share pricing - time after time after time. Never give up the conviction - be ready for an offering - Maintaining SELL;
  • Harvard Apparatus RT (HART) closed UP +$0.14 to $1.47 and has been on a roll since issuing a flutter of announcements pre the financial results aka –LPS (loss per share) earnings call. The question is how long can the appreciation last, the pre-market indication is +$0.04 but, what follow-on news will sustain the momentum?  “Icarus wings were of feathers and wax! Icarus's father warned him first of complacency and then of hubris, asking that he fly neither too low nor too high, so the sea's dampness would not clog his wings or the sun's heat melt them. Icarus ignored his father's instructions not to fly too close to the sun, whereupon the wax in his wings melted and he fell into the sea” – HOLD;
  • Juno Therapeutics (JUNO) closed DOWN -$0.34 <after Monday’s -$> and is not feeling the groove as it is down -$0.13 in the aftermarket having traded more than 26% higher in October. Shares had bounced back strongly from their September lows, and investors who got in at Juno's IPO are currently sitting on a strong 42% gain. JUNO’s shares are likely to remain extremely volatile until the end of the year, so investors should be prepared for more volatility - SELL;
  • Kite Pharma (KITE) closed UP +$0.55 to $79.89 on 726 K shares traded <3 month average =937.6 K shares>and is UP +$0.26 in the after-market. KITE continues to expect cash burn of $100–$125 M in 2015 including both operating expenses and capital expenditures but … excluding the impact of business development activities. KITE’s lead pipeline candidate, KTE-C19, recently moved into the P2 status of a P1/2 study (ZUMA-1) in patients with refractory, aggressive non-Hodgkin's lymphoma (NHL) including patients with refractory diffuse large B cell lymphoma (DLBCL including primary mediastinal B cell lymphoma - PMBCL and transformed follicular lymphoma – TFL). Top-line data from the P1 part of the study will be presented at the annual meeting of the American Society of Hematology (ASH) in early December.  Interim results from the study are expected next year with the BLA submission expected in late 2016. If all goes well, KTE-C19 could be launched for this indication as early as 2017. KTE-C19 also moved into a P2 study (ZUMA-2) for the treatment of relapsed or refractory mantle cell lymphoma (r/r MCL). KITE intends to commence two (2) additional pivotal studies on KTE-C19 for acute lymphoblastic leukemia (ALL) by year end - ZUMA-3 for adult ALL and ZUMA-4 for pediatric “ALL” – BUY;
  • Northwest Bio (NWBO) closed UP +$0.14 to $4.57 after their track record – how could anyone in their right mind invest? Reducing the risk as the year ends points to the downside - isn’t that what investing is all about. Also needs cash, if so dilution increases the risk of depreciation – SELL;
  • Osiris (OSIR) closed DOWN -$3.01 after a down-grade by Brean <after Monday’s -$0.33> to $10.97 and is up +$0.04 in the aftermarket - another I told-you-so!  Who is kidding whom, definitively oversold, while MiMedx (MDXG) also feels the heat -$0.11 to $8.12 – both are undervalued - BUY;
  • Spark Therapeutics (ONCE) closed DOWN -$0.10 <after Monday’s -$3.94> to $51.90. Oversold – maintaining BUY;          
  • Verastem (VSTM) closed DOWN -$0.06 <after Monday’s +$0.01 after being down on Friday -$0.01 following Thursday -$0.07, after Wednesday’s -$0.06 after Tuesday’s -$0.02> to $1.92 with only 289.6 K shares traded <3 month average = 997.4 K shares> after reporting $120.5 M in cash and 36.93 M share outstanding and a float of 31.22 m shares. Total cash per share = $3.26 and a book value of per share of $3.04. Oversold, Maintaining BUY;

 

 

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.

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