September 12, 2016 6:10pm

… At the 10:30 am mark, the pricing race sped upward

 

The iShares Nasdaq Biotechnology ETF (IBB) jumped +3.04% after being down -3.26%

… The tug-of-war between the oversold and overbought tightened; if you want to achieve portfolio appreciation, investors should read/listen to what I am saying

 

Pre-open indication’s tally:  4 hits (AGTC, BTX, JUNO, KITE and VTGN) and 1 miss (AST)

Advance/Decline and Flat Recap: 30/11 and 2 flats

 

Financial results/earnings: AGTC

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

 

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

 

I wasn’t surprised by today’s sector action, in fact if you had read the am post - you wouldn’t have had to lose playing sector poker with the market! It is TIME to be a subscriber!

 

 

 

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 sharply higher on Monday after a key FED official advised "prudence" with regards to interest rates.

The NASDAQ closed UP +85.98 or +1.68% to 5,211.89 and the DOW closed UP +239.62 or +1.32% to 18,325.07.

 

 

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 15/26 and 2 flats;
  • The mid-day skipped positive with an A/DL of 27/14 and 2 flats;
  • The closing bell continued positive with A/DL of 30/11 and 2 flats;

 

 

Henry’omics:

The stem, cell, gene and regenerative therapy (SCGT&RT) sector was negative at the opening bell, skipped positive at the mid-day with the sector closing positive.

  • I keep telling investors to check the indexes and ETFs, the IBB was UP +3.04%, the IWM was UP +1.139%, the XBI was UP +3.61% and the XLV were UP +1.48%.

How much of the sector and market are based on numerical analysis – 60% to 70%. The rest is sentiment, market breadth, relative strength and just plain emotion – in “our” universe

Volume spiked again in Neuralstem (CUR), ImmunoCellular (NYSEMKT : IMUC) – 4th day, MiMedx (MDXG) – 4th day, Northwest Bio (NWBO) – 4th day, Sangamo (SGMO) – 4th day, and bluebird bio (BLUE) – 3rd day.

Volume is picking-up.

  • As volatility in the downside averaged –0.08% to 4.64%
  • While the upside volatility spread averaged +1.11% to 18.59%.

For months, we have been grinding up, down yet incrementally sideways without being able to take out some resistance regions as support levels ate blurred.

  • The only way to explain the upside is basically many sector “participants” were oversold – plain and simple!

My primary pattern is to watch the advance/decline lines (A/DL) as well as maintain an open mind based upon how the changes in the A/DL take shape.

  • As a word of caution to investors – we are solidly stuck in a trading market with investors left on the sidelines!

 

My expectation is to see the usual stock price destruction to continue and the upswings to incrementally take pricing higher and slower.

  • Keep in mind the recent sector action and do NOT make any certain assumptions of what the market will do in relation to “our” universe!

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

 

 

Pre-open indication’s tally:  4 hit and 1 miss:

  • Applied Genetic Technologies (AGTC) closed UP +$0.82 – hit;
  • Asterias Biotherapeutics (NYSEMKT: AST) closed UP +$0.05 – miss;
  • Juno Therapeutics (JUNO) closed UP +$1.39 – hit;
  • Kite Pharma (KITE) closed UP +$0.49 – hit;
  • VistaGen (VTGN) closed DOWN -$0.12 – hit;

 

 

Financial results/earnings:

Applied Genetic Technologies Corp. (AGTC) reported Q4/16 net income of $2.7 M, or $0.15 per share.

  • The results exceeded street expectations for earnings of $0.06 per share, but revenue of $12.1 M in the period, which missed street forecasts having expected $13.1 M.
  • AGTC shares have fallen 35% since the beginning of the year. In the final minutes of trading on Monday, shares hit $13.19, a decrease of 15% in the last 12 months.
  • The final key - $172.7 M in cash

 

 

Today’s Bottom Line:

I’m not jumping for joy; it’s all about expectation, watching quantitative numbers and making a qualitative judgement each day …

 

 

Out and about:

Kite Pharma (KITE) jumped 1.39% …

  • The shares jumped to $57.22 on Monday from $56.73 from Friday’s session. Trading volume was more <1.219M shares> than the 3 month average <796,022 shares>.
  • Kite Pharma's move compares with the 3.04% jump in the Nasdaq Biotechnology Index and the 1.47% gain in the Standard & Poor's 500 Index.
  • Rydex Series - Biotechnology Fund increased its holdings of the company by 8.8% to 63,200 shares as of Aug. 31, according to monthly updates compiled by Bloomberg.
  • Cash Balance of $531.1M is 22.5% of KITE’s Enterprise Value <$2.22 B>, based on Jun 30, 2016 balance sheet and a market cap of $2.86 B.
  • The stock returned a negative 5.4% so far this year and a gain of 3.9% in the past 52 weeks.
  • Shares short were 6.61M, 10.61%of outstanding while it was 18.55% short of the float <40.19 M shares>. Shares short the previous month was 6.71%

 

 

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

  • Monday traded 15.7 – 13% lower;
  • Friday traded 16.4 – 30% higher;
  • Thursday traded 12.2;
  • Wednesday traded 11.94;
  • Tuesday traded near 12.2;
  • Last Monday was a holiday;

 

 

Decliners:

  • VistaGen (VTGN) -4.88% after Friday’s +3.02% - Friday’s comment came true, next week’s target;
  • International Stem Cell (ISCO) -3.08% after Friday’s +8.33% after Thursday’s flat;
  • Fate Therapeutics (FATE) -1.82%;
  • Mesoblast (MESO) -1.52%;
  • Opexa (OPXA) -1.42%

 

Advancers:

  • Northwest Bio (NWBO) +17.56% or +$0.0597;
  • Bluebird bio (BLUE) +10.07%;
  • Stemline (STML) +8.55% after Friday’s -9.39%;
  • Sangamo (SGMO) +7.34% after Friday’s -7.23%;
  • Neuralstem (CUR) +7.22% or +$0.02 after Friday’s +7.58% or +$0.02

 

Flat:                                                            

  • ReNeuron (RENE.L) at $2.625;
  • Verastem (VSTM) at $1.32

                                                                                                                               

                                                                                                  

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.