The summer play period is over and even though the coming week will be shortened due to the Labor Day holiday, it'll back to work for the masses come Tuesday morning - meaning investors can look for a sharp uptick in overall trading volume during the next four trading days. Generally susceptible to a summer swoon, the markets held relatively strong during the beach season this year and ended last week on high note after after US Fed Chairman Ben Bernanke hinted that additional actions to strengthen the US economy would be undertaken, should it not continue regain continued momentum on its own.
Bernanke's notes from Jackson Hole, Wyoming were highly anticipated last week and added some life to an otherwise ho-hum week of sideways trading. The next Fed minutes will be released mid-September, about the time that investors may expect more definitive comments from Mr. Bernanke.
Meanwhile, the potential economic catalyst for this week could come from Europe, where a Thursday meeting with representatives of the European Central Bank (ECB) could provide definitive steps for easing the debt burdens of those countries most hardest-hit by the economic crisis, such as Spain and Portugal. As has been the trend through the spring and summer months, economic undertaking in Europe can heavily influence global trading trends.
Friday's payroll report in the US could also effect near-term trading, but Bernanke's comments last week already tamed expectations on that front. It's a generally accepted fact that the economy is inching along, so no one is really expecting any surprises - although a true surprise on the data front has the potential to ignite a market rally, should the data be a strong enough surprise to the upside.
Internet / Technology:
Facebook Inc. (FB): The bad just keeps getting worse for Facebook and its share price. After storming the IPO scene earlier this year at $38, shares once again set new lows last week and closed the day Friday down by another five percent after dropping by over a buck on the day. There could be more pain in the work for Facebook shareholders as more shares become available for trading over the next few months when key lock-up periods expire. The first major 'lock-up' expiration came on August 16th, when some traders first became able to trade IPO shares after a pre-determined 'lock-up' period. About 243 million more shares will become available for trading over the next couple of month, with 1.2 billion entering the market on November 14th, according to a Reuters report from last week.
Unless the company has an announcement or two up its sleeve that would prevent these investors from selling, a trip to the mid-teens is likely, in my opinion - with a dip towards the ten dollar mark possible - especially if brokerages continue to slash their price targets on FB shares...
Explosive Trace Detection (ETD) / Global Defense:
Implant Sciences (IMSC): Although Implant has probably the most significant event pending in the company's history this month, IMSC shares dropped by over eight percent on Friday on volume that was well over twice the daily norm. The drop in share price placed the company's market cap under the forty million dollar mark again and had shares trading well off the 52-week highs set during the closing days of June.
Implant's Quantum Sniffer (QS) B220 benchtop explosive trace detection (ETD) device is slated to potentially receive an approval by the US Transportation Security Administration (TSA) at some point in September for use in the screening of air cargo, according to a report issued by the company last month, so Friday's action and this key pending catalyst has IMSC as a stock to watch for the month of September. In regards to the potential approval of the B220, Implant is engaged in a silent period, which means the next news we here concerning the approval should be the final determination by the TSA...
Healthcare, Biotech, Pharmaceutical:
Amarin Corporation (AMRN): Amarin made it two Fridays in a row of posting solid gains with a five percent spike launching shares closer to the fourteen dollar point. The company did announce last week that additional data from the pivotal MARINE Phase III trial are were published in the Journal of Clinical Lipidology, but investors are still awaiting decisive news - issuance of patents and/or New Chemical Entity (NCE) status - that would better dictate how much market exclusivity can be counted on for Vascepa, recently approved by the FDA for the treatment of very high triglycerides.
Since it is highly-speculated by investors that Amarin will look for a buyout deal before its all said and done, both the patent and NCE side-stories could prove as crucial factors in determining the final value of any deal. Meanwhile, Amarin is moving ahead with plans for an early-2013 commercial launch. Friday's price action, however, could be an indication that investors believe a buyout deal will be announced before that time.
Numerous analysts have also retained their mid-$20 price targets for AMRN...
Sunshine Heart (SSH): Sunshine Heart is proving to be a potential ground-floor buying opportunity based on the potential of its C-Pulse Heart Assist system, which has already been approved in Europe and is being prepared for a pivotal trial in the United States. C-Pulse is an implantable medical device intended to treat patients of Class III and ambulatory Class IV heart failure and is considered a minimally invasive implant, mainly because the device is implanted outside of the blood stream in a patient's heart. The device could also be considered as having no competition in the intended market, given that current treatments for Class III heart failure may at best only stabilize disease progression.
Earlier this summer, Sunshine shares exploded on heavy volume - from three to seventeen dollars - but a pullback in price quickly ensued and a stock offering announced for seven dollars brought shares even further back to earth. Having settled below the offering price, however, and with the share price looking to have stabilized, this is one to keep on the radar...
Neostem, Inc. (NBS): Neostem is another company in a very lucrative sector that has seen its trading volume tail off a bit as the company's share price has slipped from their summer highs.
NBS began climbing a few months ago on positive pipeline progress and then received a further boost as the company decided to divest its majority stake in a subsidiary, Erye, in order the strengthen its balance sheet. Then, just weeks ago, the company reported that it had received approval from a data monitoring committee to continue moving forward with its Phase II PreSERVE trial, designed to measure the effectiveness of AMR-001 in preventing or treating major cardiac events following heart attacks. Such approvals are positive in the sense that they provide a firm validation of trial progress, which is especially noteworthy in the sector of regenerative medicine where the technology is still relatively unproven. The intended market for AMR-001 - especially considering its potential use in also treating congestive heart failure - stands in the billions...
TrovaGene Inc (TROV): TrovaGene's shares have been trending back towards the two dollar mark, but the company has some pending catalysts for the fourth quarter that put this one back on the 'watch list' for the time being. Most notably, the company intends to launch a trial later this year that will test its proprietary diagnostic technology in identifying pancreatic cancer by means of a patient's urine sample. In addition to this key catalyst, results from other ongoing trials are slated for interim review around the same time frame, too. Shares flew to new 52-week highs earlier this year on the announcement of a diagnostic test to determine the presence of high risk Human Papilloma Virus (HPV) subtypes from urine specimens...
MannKind Corp (MNKD): Shares of MannKind were down by over twelve percent during Friday's after-hours trading after news circulated the wires that the company had filed a $500 million mixed-securities shelf. Such a cash-raising event was expected by many investors for months, even as the MNKD share price rebounded from its sub-$2 lows. Now that the news is on the street, it's likely that the MNKD share price could take a beating once again, barring the release of any follow-up news - such as a the interest of a major partner - that could keep investors interested leading into the next round of Afrezza testing...
Advanced Medical Isotope Corporation (ADMD): Shares of Advanced Medical Isotope received a mid-week price and volume boost last week after a few trading days of relatively light volume, and Friday's five cent spread - although on light volume again - could put this one on the radar again for the coming week.
Nuclear medicine, specifically the distribution and use of medical isotopes, is still a booming business and AMIC may have positioned itself right in the center of the industry as a US-based distributor and developer of new and innovative technologies utilizing the sector's next-generation technologies. Medical isotopes are used in the identification and treatment of various diseases - including cancer and heart disease - and their use is already a part of a proven multi-billion dollar market. Demand may actually as geo-political factors have the medical community looking to use low-enriched uranium, as opposed to highly-enriched. That's where AMIC, with an already-established distribution network, stands to capitalize...
Lpath, Inc. (LPTN): Shares of Lpath were on the move this past Monday as a key catalyst that had been expected to unfold for months finally did. Earlier this year the LPTN share price dropped to below the dollar mark after the company announced that iSONEP trials would be halted due to a non-compliance issue with the FDA by the company's fill/finish contractor. There were no safety or other concerns regarding iSONEP itself, but the potential months-long trial halt created enough uncertainty in the minds of traders to spark enough of an exodus for shares to dip to below seventy cents from January's highs of well over a buck. It also didn't help, however, that a stock offering was announced right around the time of the trail halt. The past is the past, though, and a Monday news release demonstrated that enrollment is back on track. According to the release, Lpath will continue recruiting patients for its Nexus trial, measuring the effectiveness of iSONEP as a potential treatment for wet AMD. The first patient in the re-started trial is expected to be treated in mid-September and the news brought in volume of over double the daily norm...
Synergy Pharmaceuticals (SGYP): Synergy shares broke through the five dollar mark last week on high volume as Ironwood Pharmaceuticals (IRWD) received FDA approval for Linzess, previously known as Linaclotide. On August 13th, SGYP shares hit an intra-day low of $3.66 before closing the day at $3.74. Now, just two weeks later, shares are back at the five dollar mark, with volume again increasing.
Synergy had initially moved higher during the dog days of summer after a merger with Callisto Pharmaceuticals (CLSP) was announced in late July. The merger put Synergy in a position of strength in its quest to attract a more committed investor because - as a result of the deal - Callisto's previously-held for percent stake in SGYP will be cancelled and distributed evenly amongst Callisto investors. Many large funds and institutions are hesitant to buy into a company already forty percent owned by another entity. The merger agreement alleviated this roadblock...
OncoSec Medical Incorporated (ONCS): Volume picked up heavily late last week for OncoSec Medical, making this player in the cancer sector one to watch during the coming week, too - especially for those that believe that volume precedes price. With the OncoSec Medical System (OMS), OncoSec may have devised a method of delivery for therapies and drugs into cancerous cells that not only meets the ideals of the lower-costing and less-intrusive treatments that the medical community is searching for, but could also change the face of how cancer-fighting therapies and drugs are delivered - most notably in regards to skin cancer...
Disclosure: Long AMRN, IMSC, SGYP, MNKD.
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