August 19, 2016 5:12pm

… Don’t assume appreciation is off-the-table


I do not anticipate any end-of- summer surprises for “our” universe

 

Pre-open indication’s tally:  4 hits and 2 miss

 

I answer one question; in which company should investors put, keep and commit their money!

 

Do you care what happened today, you should … because it has implications to Monday's sector activity?  

Where has today’s market gone – subscribe and find out. 

 

 

There are two things that investors need - interpretation of news and translation of market metrics concerning the stem, cell, gene and regenerative therapy sector to substantiate share pricing.

 

U.S. stocks closed lower on Friday.

The NASDAQ closed DOWN -1.77 or -0.03% to 5,238.38 and the DOW closed DOWN -45.13 or -0.24% to 18,553.57.

 

 

A day in the life of the stem, cell, gene and regenerative therapy (SCGT & RT) sector – the advance/decline line scenario of our 43 covered companies:    

  • The open was negative with an A/DL of 14/25 and 3 flats;
  • The mid-day stayed negative  with an A/DL of 12/30 and 1 flat;
  • The closing bell was negative with A/DL of 13/29 and 1 flat – the opposite of yesterday;

 

 

Henry’omics:

The stem, cell, gene and regenerative therapy (SCGT&RT) sector opened negative stayed negative at the mid-day with the sector closing negative.

  • Stocks continued to trade in a tight range amid low volume but, with increased volatility.

I am sticking to my ”guns”; an old Wall Street saying is that a ”rising tide lifts all boats, but no matter which way the market is moving, there are stocks that will always go their own way”.

Here are five worth watching …

  • Applied Genetic Technologies (AGTC)
  • Athersys (ATHX)
  • Fate Therapeutics (FATE)
  • Juno Therapeutics (JUNO)
  • Kite Pharma (KITE)
  • Mesoblast (MESO)

Call me cantankerous, contrarian or even a curmudgeon but at the least I get it right and investors make money!

 

 

Today’s Bottom Line:

Love my pool and the “G&Ts” therapy and I don’t mean gene therapies; forget the sector and market – sarcasm, enjoy the weekend!

  • Be ready for a pick-up Monday post the negative pricing of Tuesday, Wednesday and Friday’s downdrafts!

 

 

Out and about:

Biostage (BSTG) closed DOWN -$0.06 to $1.04

  • The market has not accepted the pre-clinical status of a venture stage company with a public listing even though the new CEO has made remarkable strides in validating the platform after many mistakes, scientific relations and past temporary management practices.
  • Discipline is BACK! Focus has been reinstated after “bloody” exits …

But, the emphasis MUST be on the stock price to VALIDATE the internal successes …

AS one battles the market perception, a CEO needs to possess a “team” that “knows the ropes”, follows-through and “recognizes” their roles!

EXPECT this CEO to earn his way UP the “financing food chain”

 

 

BioLife Solution (BLFS) close UP +$0.06 to $1.91 in a day’s range of $1.86 to $1.93 …

  • Don’t be fooled by appreciation by low volume – 11.8 K shares <3 month average = 395.1 K shares> …
  • BLFS has NO cash other than that borrowed from a quasi ATM at 10% - “the vig”.

Dangerous place to be … SELL it to another company that can manage it effectively …

 

 

Vericel (VCEL) closed UP +$0.06 to $2.25 …

Any movement is welcomed, Q2 was “ham strung” by a downtime for the Carticel and Epicel cleanrooms to replace a rooftop air handler unit which resulted in a two week, or approximately 16% reduction in product shipment dates for both products during Q2. 

  • As a result, total Carticel and Epicel net revenues decreased 3.9% compared to the Q2/15, with Carticel net revenues decreasing less than $100 K and Epicel net revenues decreasing approximately $400 K  compared to Q2/15. 
  • Gross profit for Q2/16 was 43% of net product revenues, compared to 49% of net product revenues forQ2/15. 
  • The reduction – again in gross profit was primarily due to the reduced volume resulting from the cleanroom downtime. 

Gross profit for the first half of 2016 was $13.1 M, or 49% of net product revenues, compared to $12 M, or 49% of net product revenues, for the first half of 2015

Q3 and Q4 should reflect better revenues and incremental gross profit increases.

The problem is VCEL needs a financing …

 

 

Intrexon (XON) closed DOWN -$0.19 to $29.16 in a daily range of $28.75 to $29.45…

CDC expands travel warning as Zika spreads in Miami. Pregnant women should avoid traveling in the tourist-friendly South Beach area <Boston Globe front page>.

As experts predicted that Zika virus would eventually make its way to the continental US, which boasts considerable populations of the Aedes aegypti mosquito that spreads the disease.

  • Last month, the first case of Zika virus confirmed to be transmitted by local mosquitoes was reported in Miami-Dade County, Florida.
  • Today the total number of confirmed cases stands at 33, although, since most individuals who contract Zika virus won't express symptoms, the actual total is surely higher.
  • At first glance, the encroachment of Zika-virus-spreading mosquitoes in the lower 48 presents an opportunity for Intrexon (NYSE:XON), the engineered biology conglomerate that acquired the self-limiting insect platform of Oxitec, which is jumping through regulatory hurdles seeking approval for its novel vector-control technology.
  • While the technology represents a low-impact approach to controlling wild mosquito populations, the growing problem in Florida actually changes very little in the near or medium term for the company and investors. <Motley Fool>

Despite recent events, Intrexon will not generate revenue from Oxitec's platform in the US in 2016.

The U.S. FDA recently published its finding that the company's self-limiting mosquitoes are "not expected to cause any significant adverse impacts on the environment or human and non-target animal health beyond those caused by wild-type mosquitoes?"  Is the FDA in the “right mind” – anything that helps – PROVIDES RELIEF!

Are they asleep at the federal “cash register” …?

Yet while some media outlets reported that the FDA had approved Oxitec's self-limiting mosquito(s) that hasn’t actually happened.

The ruling simply cleared the way for the company to conduct a field trial in the Florida Keys. Before that happens, Oxitec must receive approval from local officials and residents -- and that just became a bit more complicated.

 

 

Osiris (OSIR) closed DOWN -$0.0547 to $5.18 …

Sins of the past depreciated the share pricing … so when will it be forgiven, confession is not enough …

  • As previously disclosed, on each of March 17, 2016 and May 12, 2016 OSIR received a notification from NASDAQ indicating that, as a result of not timely filing with the SEC its 2015 10-K and its Q1/16.
  • On August 12, 2016, OSIR received again a NASDAQ letter noting that OSIR had not timely filed its 10-Q for Q2/16 which represented another basis for non-compliance. 

NASDAQ granted an exemption, extending the deadline until 9/12/16 for OSIR to file all delinquent reports …

OSIR’s new independent registered public accounting firm needs to work harder, faster … and also bring-in a NEW MANAGEMENT TEAM … maybe some of the good and great members who LEFT …

Working diligently does NOT make the stock appreciate …

 

 

Pre-open indication’s tally:  4 hits and 2 miss:

  • Applied Genetic Technologies (AGTC) closed DOWN -$0.27 – miss;
  • Cellectis SA (CLLS) closed DOWN -$0.81 - miss;
  • Juno Therapeutics (JUNO) closed DOWN -$0.89 – hit;
  • Kite Pharma (KITE) closed UP +$0.15 – hit;
  • Pluristem (PSTI) closed DOWN -$0.01 – hit;
  • StemCells (STEM) closed DOWN -$0.42 – hit;

 

 

Pet peeve:

High-frequency trading accounted for 49% of August's daily trading volume of about 6.3 billion shares, according <TABB Group>.

  • During the peak levels of high-frequency trading in 2009, about 61% of 9.8 billion of average daily shares traded were executed by high-frequency traders.

 

 

Review my fear gauge or the CBOE Volatility Index (VIX):

  • Friday traded near 11.6;
  • Thursday trade near 11.6;
  • Wednesday traded 12.5;
  • Tuesday traded 12.5;
  • Monday traded 11.81;
  • Last Friday traded near 11.5;

 

 

Decliners:

  • StemCells (STEM) -25.30% after Thursday’s -9.78% after Wednesday’s -29.23% after Tuesday’s +598.55% after merger;
  • Biostage (BSTG) -5.45%;
  • bluebird bio BLUE) -5.24%;
  • Organovo (ONVO) -4.31% after Thursday’s -3.91%;
  • Mesoblast (MESO) -3.92%

 

Advancers:

  • Cesca Therapeutics (KOOL) +7.22%;
  • Regenxbio (RGNX) +4.79%;
  • Northwest Bio (NWB) +4.70%;
  • Vericel (VCEL) +2.74% after Thursday’s +4.29%;
  • BioLife Solutions (BLFS) +3.24%

 

Flat:

  • Fate Therapeutics (FATE) at $2.92;

                                                                                                                                       

                                                                                                  

 

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.