November 13, 2017 7:29am
Stocks have also been pressured by fears that a bad news event that is somewhere out there will drive down even current “perceived” value …
It’s time to re-cast the value opportunity and the time frame “involved”
Pre-open trading indications: 5 SELLs and 1 BUY
Earnings this week: 11/13 – CUR and FCSC; KOOL and AST – 11/14
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Lower open expected
Dow futures are DOWN -0.22% (-51 points) and NASDAQ futures are also DOWN -0.10% (-6.25 points)
U.S. stock index futures pointed to a relatively weak open Monday, as investors continued to wade through another batch of earnings, while keeping an eye on news surrounding the tax situation in the U.S.
European stocks were mostly lower as investors focused on earnings and monitored political woes in the U.K.
Asian markets wavered after U.S. stocks closed mostly lower on Friday, with Japan's Nikkei 225 index ending lower for the fourth straight session.
Issues that will affect the trading day: Market sentiment has been on edge as of late, after news emerged that a corporate tax cut from 35 percent to 20 percent could be delayed until 2019.
Data docket: the monthly treasury statement is due to be released at 2 p.m. ET.
On the political front: the future of a tax reform deal in the U.S. continues to add uncertainty to markets.
The cell therapy sector closed POSITIVE on Friday and Thursday, NEGATIVE on Wednesday, Tuesday and last Monday.
The cell therapy sector’s record over the last 5 sessions (of 43 covered companies):
· Friday closed POSITIVE with 18 decliners, 24 advancers and 1 flat;
· Thursday closed POSITIVE with 15 decliners, 25 advancers and 3 flats;
· Wednesday closed NEGATIVE with 23 decliners, 16 advancers and 4 flats;
· Tuesday closed NEGATIVE with 33 decliners, 8 advancers and 2 flats;
· Last Monday closed NEGATIVE with 30 decliners, 10 advancers and 3 flats;
Henry’omics:
From Friday night’s closing bell post, “some of yesterday’s ups continue to aspire.”
As I had stated, “If some of these development platforms are so “robust”, why haven’t they been partnered and less dependent on dilutionary and depreciating financings? Watch your “six”, the reality of about-to-be financings is coming … Capricor (CAPR), Cytori (CYTX) and a maybe Vericel (VCEL) to name a few? Shareholders are always the sufferers!”
Do managements even care as share pricing grinds directionless …? All I have heard are the usual scripts!
Sector sentiment has rolled over and over with many a downside in this market; underpinning measurable indicators used for timing price movements ruining the outlook of the many!
Sentiment readings are used as a sign of the “mood” of our universe, lately with swings at either extreme.
Risk appetites flash some say greed – I say stupidity, prompting many a call for caution in buying.
As we measure sentiment readings also monitor volume as to volatility in regard to momentum which seems to ebb and flow and which doesn’t always correspond with moves in this market.
You’ve made it to the office, turned on the monitor, having just gotten your coffee and it hits you - what could be today’s trades?
Watch list:
- The iShares Nasdaq Biotechnology (IBB) is NOT indicating in Monday’s pre-market;
- The SPDR S&P Biotech ETF (XBI) is NOT indicating in Monday’s pre-market;
- The Health Care Select Sector SPDR ETF (XLV) is NOT indicating in Monday’s pre-open;
- The iShares Russell 2000 (IWM) is indicating a NEGATIVE -0.26% in Monday’s pre-open
Companies in my headlights:
Aduro Biotech (ADRO) closed up +$0.10 to $7.95 with 858.2 K shares traded after Thursday’s +$0.05 to $7.85 with 500 shares traded after Wednesday’s flat at $7.80 with 394.4 K shares traded <3 month average = 457.7 K shares> after Tuesday’s -$0.05 to $7.80 with 462.5 K shares traded and last Monday’s -$0.10 at $7.85. There is approximately $4.83 per outstanding share in cash – Maintaining BUY;
Applied Genetic Technologies (AGTC) closed up $0.125 to $3.775 with 81 K shares traded after Thursday’s +$0.05 to $3.65 with 184.4 k shares traded after Wednesday’s +$0.20 to $3.60 after Tuesday’s -$0.05 to $3.40 after Monday’s +$0.05 to $3.45 with 85 K shares traded <3 month average = 160.4 K shares>. AGTC has a problem = perception, volume is weak, sentiment is negative and MANY still have questions as to the enrollment issues within their clinical trials and their CEO’s capacity to hear the share pricing groans of investors - tone deaf? – Maintaining SELL;
AxoGen (AXGN) closed up again another +$0.15 to $25.05 with 192 K shares traded after Thursday’s +$0.80 to $24.90 after Wednesday’s +$0.20 to $24.10. My issue is the cash position ($22 M) and bank debt positions ($25 M). It’s still rich with a trader’s target on its back with $1.35 (+23.7%) in five (5) sessions - Maintaining SELL;
BioLife Solutions (BLFS) closed up +$0.76 to $5.91 with 412.6 K shares traded <3 month average = 219.8 K shares>. Wednesday (11/9) saw $5.01. 11/1 saw $5.60 while 9/1 saw $4.86; I still have a problem with their cash and debt position and their dependence on facilitation for others, sooner or later companies are going to seek internal solutions – Maintaining SELL;
Capricor (CAPR) is taking investors for a ride with a fall over the cliff at the end of the road. Maybe not today or tomorrow; it’s those ominous questions of financings and unanswered responses re their platform integrating with other therapies are there – it’s the hype and its climax that will be their downfall. CAPR closed up +$0.26 to $2.47 after Thursday’s $2.21, Wednesday’s $2.32, Tuesday’s $2.00 and last Monday’s 2.14. There is a forthcoming presentation of interim results, with the current therapy on the market – WHAT are their add-on and the conditions of administration? Maintaining SELL;
Vericel (VCEL) closed down -$0.15 to $4.05 with 522.4 K shares traded <3 month average = 784 K shares> after Thursday’s +$0.20 to $4.20 after Wednesday’s -$0.22 to $4.00 after Tuesday’s -$0.10 to $4.30. Questions will be brought up on the call and an offering could or should be in the cards as VCEL has only $14 M in cash but, $10.8 M in debt plus we have seen $4.30 multiple times in November, October and September. Be ready for an offering/financing – Maintaining SELL;
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.
