November 30, 2015 5:44pm

Volatility, risk, rancor over depreciating pricing and those who are pumping stocks - the elevator will soon be headed straight down

Today is the last trading day for November. Subscription required … http://www.regmedinvestors.com/create-account

 

 

I say today what others won't, so you can do what others can't - access insight into sector sentiment and share pricing!

 

 

U.S. stocks closed lower Monday, the last day of trade for November, as investors eyed retail results and readied for key data and central bank comments later in the week. The major averages posted their second-straight month of gains, the first such win streak since May. The S&P 500 eked out a roughly 0.05% gain for November, while the NASDAQ gained more than 1% for the month and the Dow ended the month up about 0.3%.

The NASDAQ closed DOWN -18.86 or -0.37% to 5,108.67 and the DOW closed DOWN -78.57 or -0.44% to 17,719.92.

 

 

Henry’omics:

The stem, cell and gene therapy RegMed sector opened positive and then flopped to the downside at the mid-day to end negative at the close (of 43 covered companies).

  • The iShares Nasdaq Biotechnology ETF (IBB) briefly traded more than 2% lower, weighing on the NASDAQ composite.

Volume was moderate except in specific cases of some appreciators and the fallen!

  • My fear gauge is static – The CBOE Volatility Index (VIX) traded UP on Monday above 16 following Friday’s above 15!

As I had stated, I was a contrarian I reference to Friday’s “moves” and many stock commentators - I didn't see significant (support) for the … upside and – I just happened to be right- again!

  • Reiterating, with the stem, cell and gene therapy RegMed sector being one of the most over-bought at times and oversold sectors within the biotech industry; it brings forth the question of navigating the behavior and nuances of this sector.

 

 

A day in the life of the stem, cell and gene therapy RegMed (SCGT & RM) sector:

  • The SCGT & RM equities opened positive with an Advance/Decline line (A/DL) of 25/15 and 3 flats;
  • The mid-day strayed negative with an A/DL of 16/25 and 2 flats;
  • The closing bell rang negative to end Monday’s session with an A/DL of 15/24 and 4 flats.

 

 

Riding the indexes and ETFs roller-coaster:

  • The iShares Biotechnology Stocks ETF (IBB) closed DOWN on Monday -6.64 or -1.95% after Friday’s advance of +2.16 or +0.64%;
  • The NASDAQ Biotechnology index (NBI) closed on Monday -67.62 or -1.90 after Friday’s advance of +22.20 or +0.63%;
  • The Russell 2000 (IWM) closed DOWN on Monday -0.52 or -0.43% after Friday’s +0.45 or +0.38%;
  • The SPDR SD&P Biotech ETF (XBI) closed DOWN on Monday -0.33 or -0.45% after Friday’s advance of +0.17 or +0.23%;

 

 

Dosing the sector – what a day for the 43 Patients:

  • Open: POSITIVE with 15 decliners, 25 advances and 3 flats;             
  • Mid-day (1 pm): NEGATIVE with 25 decliners, 16 advancers and 2 flats;
  • Closing bell: NEGATIVE with 24 decliners, 15advancers and 4 flats

 

 

Out and above:

Harvard Apparatus RT (HART) jumped another +47.73% or +$1.05 to $3.25 with 18.329 M shares traded in a day’s range of $2.06 to $3.47 after Friday’s +44% or +$0.45 from $1.76 to $2.20 with 2.973 M shares traded. 

  • There are 13.45 M shares outstanding and a float of 11.79 M while shares short were 79.99 K versus the prior months of 71.73 K. I’d be jumping on that bandwagon!

Talk about a “bio-engineered” share pricing – a play on adjectives after Wednesday’s share volume of 576.3 K and decease 0f -$0.04 <remember Thursday was a holiday>.

  • It scares me, when appreciation jumps +91% over two days and volume has been more than … staggering since the financial results and PR release hit <since 11/11>;
  • So we are back <to last week’s analogy> of Icarus, the son of Daedalus who dared to fly too near the sun on wings of feathers and wax.  I’ve cautioned that using “pumpers” to “fly “ company’s stock higher has its problems … Number #1 – the SEC is watching and Billy Galvin, the intrepid Secretary of State has long tentacles!

The problem will probably be reduced by profit-takers bursting the bubble and the specter of a company in transition that needs to access the capital markets!

  • Moderation and control is needed because when you let the pumpers off … the leash – trouble will be following you!

Disclosure, I personally like the CEO and “some” members of the corporate staff but, the facts must be placed in evidence!!

 

 

Between a rock and a harder place:

Northwest Biotherapeutics (NWBO) announced today that the BOD is committed to adding an additional independent director, and NWBO welcomes Neil Woodford's call for an independent investigation of allegations in a recent anonymous internet report on NW Bio.  NWBO's Board is under way on both initiatives.

  • The interview and consideration process for a new Board seat is well under way with Mr. Woodford's candidate, Mr. Elliott Leary. 

Woodford put forth the idea of bringing in ex-FBI agent Elliott Leary as an independent director to run a probe into the company's financial dealings. Leary is a managing director at Freeh Group International Solutions, a risk management firm run by former FBI director Louis Freeh, which has now been "engaged" by Woodford's fund in relation to its investment.

  • Ah, my former brethren have been called again; as I have always said … it is all about the facts in evidence!

NWBO’s Board is hoping to meet with him again in the next couple of days, and to promptly complete the process."

  • Ms. Powers also commented: "We also welcome Mr. Woodford's proposal for an independent investigation of claims made in a recent internet report.  Most of those claims have been recycled over and over, and the internet report was anonymous;
  • However, the Company and the Board take such claims seriously, the Board has already been meeting to address the report, and the Board plans to meet again this week in regard to moving forward on an independent investigation such as Mr. Woodford has proposed.

 

 

Who was UP – top 5:

  • Harvard Apparatus RT (HART) closed up +$1.05 to $3.25;
  • Applied Genetic Technologies (AGTC) +$0.38 to $17.04;
  • Avalanche Biotech (AAVL) +$0.38 to $10.48;
  • Sangamo (SGMO) +$0.30 to $8.29;
  • MiMedx (MDXG) closed up +$0.23 to $8.96

 

 

Who closed down – top 5:

  • Kite Pharma (KITE) closed down -$4.06 to $82.37;
  • bluebird bio (BLUE) -$3.85 to $88.75;
  • uniQure (QURE) $3.72 to $18.78;
  • Spark Therapeutics (ONCE) -$1.43 to $57.59 – on news of an offering;
  • Cellectis (CLLS) closed down -$1.03 to $34.12;

 

 

Flat:

  • AxoGen (AXGN) at $5.50;
  • Organovo (ONVO) at $3.39;
  • ReNeuron (RENE.L0 at $3.00;
  • Pluristem (PSTI) at $1.39

 

 

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.