Dear New World Investor:
The headline Consumer Price Index year-over-year change was 8.5% versus the 8.7% estimate and 9.1% last month. The month-over-month change was zero compared to the 0.2% estimate and 1.3% last month. That is the lowest month-over-month change since COVID hit, but the entire cause was the drop in energy prices, which I don’t think will last for long. And even if inflation prints at 0% month-over-month between now and December, the CPI will still end 2022 at +6.3% year-over-year.
The core CPI excluding food and energy was up 5.9% year-over-year versus the 6.1% estimate and 5.9% last month. The core CPI month-over-month was up 0.3% versus the 0.5% estimate and 0.6% last month. After the report, the odds of a 75 basis point increase at the Fed’s September meeting collapsed from 80% to just 35%.
In 1963, Milton Friedman said that “inflation is always and everywhere a monetary phenomenon,” but there’s a newer hypothesis, the fiscal theory of the price level, that explains the current inflation. Despite massive monetary stimulus in response to the global financial crisis, inflation had remained at or near historical lows for the better part of a generation. Then COVID-19 hit and the US government sent people about $3 trillion and then borrowed an additional $2 trillion of money and sent people more checks.
Interestingly, when inflation was high and rising, the Dow Industrials returned -62%. When it was high and declining, it returned +115%. Neither is great, but the former is much less great. At least, now we get the latter.
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Market Outlook
The S&P 500 added 1.3% since last Thursday as the market rallied after the inflation report. It went over the 4177 level that marked the peak during its May-June rebound, setting a “higher high” that often means more sustained gains are in store. The Index is down 11.7% year-to-date and has to get above 4364 to exit the bear market. The Nasdaq Composite gained only 0.5% as technology, particularly semiconductors, remained under pressure. It is down 18.3% for the year but up 21.0% from its low, and technically is in a new bull market. But I’d like to see further strength before making that call.
The small-cap Russell 2000 won the week, jumping 3.6%, but still is down 12.0% in 2022. It also is up a bit more than 20% from its low and may have started a new bull market.
The VIX Fear and Greed Index actually closed under 20 yesterday for the first time since April. The fractal dimension is racing towards full consolidation at the 55 level. If it then ignites a new uptrend on top of the consolidating recovery move, the underinvested hedge funds are going to panic (if they haven’t already).
The Democrats’ new Inflation Production Reduction Act includes a 1% corporate tax on stock buybacks in 2023. For Apple, with a $90 billion buyback program, that’s an extra $900 million. But if they complete their program by December 31, they won’t have to pay the tax. Hmm…
Shortsellers
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Top 5
Changes this week: None
Near-Term – chronological order
AAPL Apple – September new iPhone introduction
OIL iPath Pure Beta Crude Oil Exchange-Traded Note – crude should rise quickly
GBTC Grayscale Bitcoin Trust – Bitcoin is coming out of one of its periodic sharp drops
META Meta – Bounce from overdone selloff
VLD Velo3D – Rapid revenue growth; low market cap
Long-Term – alphabetical order
GRPH Graphite Bio – second-generation genetic editing
NVTA Invitae – the winner-take-most of genetic testing
META Meta – a leader in the metaverse
RKLB Rocket Lab – #2 to SpaceX in space
VLD Velo3D – Return manufacturing to the US
Coming Events
All times below are ET, and most presentations and slides are archived on the companies’ websites so you can listen to them.
Friday, August 12
SAND – Sandstorm – 11:30am – Earnings conference call
Monday, August 15
SCYX – ScyNexis – 8:30am – Earnings conference call
CWBR – CohBar – 5:00pm – Earnings conference call
Tuesday, August 16
QUIK – QuickLogic – 5:00pm – Earnings conference call
The $20-For-$1 Stocks
Say you put $2,000 into a stock that goes from 50¢ a share to $10. The $2,000 turns into $40,000. Then you put the $40,000 into another stock that goes from 50¢ to $10. That turns the $40,000 into $800,000. You did it with two stocks, and never risked going negative more than $2,000. (Not that you won’t be mad at me if the first one works and then the second one doesn’t, taking your $40,000 to Money Heaven.)
If you can afford it – and it would not be too big a position in your portfolio – putting $2,000 into each of these 12 speculative biotechs might be a good way to start.
The market capitalizations of these recommendations are typically very low. At the same time, Initial Public Offering valuations had moved very high. We were seeing $750 million to $900 million valuations for a good preclinical/Phase 1 IPO, and even $300 million to $500 million for mediocre Phase 1s. I don’t see how investors make 5x to 10x in a reasonable, three- to four-year period if they buy at those valuations. How many biotechs have moved north of $10 billion within 5 years after pricing an IPO in the $700 million to $900 million range? Hardly any. Buying these out-of-favor, fallen, or forgotten companies that can get important products through the FDA at very low market capitalizations seems like a much better strategy to me.
Risks
Development-stage biotechs are subject to investor sentiment swings from wildly optimistic to excessively pessimistic – mostly the latter recently. After the Primary Risk for each company, I’ve added the clinical stage of their lead product, the probable time of their first FDA approval, and the probable time of their next financing.
As always, you need to think about an appropriate position size. You could buy a full position upfront and then just hold on, or buy some upfront and leave room to add more on the inevitable financings, transient clinical trial setbacks, and the like.
Aptose Biosciences (APTO – $0.84) did an interesting fireside chat at the Canaccord Genuity Growth Conference (AUDIO HERE and SLIDES HERE). They expect to start registrational trials for HM43239 in 2023.
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HM43239 started dose escalation trials at a very low 20 milligrams once a day (left side of the graphic below). When they got up to 80 milligrams they saw signs of activity, so they expanded that cohort to 20 patients and had five complete responses. These are very sick relapsed or refractory acute myeloid leukemia patients with no treatment options left. They have escalated the dose to now 200 milligrams while expanding the 120- and 160-milligram cohorts and seen more complete responses (cures) at both levels. This is remarkable and the drug is safe. It is going to get FDA approval.
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There is a steady stream of data coming at scientific meetings in December, next June, and the following December. Today’s $77 million market capitalization for a coming successful oncology drug is ridiculously low. APTO is a Buy under $2.50 for a $30 target in a buyout.
Primary Risk: Either drug fails in clinical trials.
Clinical stage of lead product: Phase 1a
Probable time of first FDA approval: 2025
Probable time of next financing: Mid- to late-2023
Graphite Bio (GRPH – $3.97) reported a June quarter loss of 48¢, right on the estimate. There was no conference call, but they updated their presentation.
The big news is they dosed the first patient with GPH101 in their Phase 1/2 trial in people with sickle cell disease. They expect initial proof-of-concept data in mid-2023. GPH102 for beta-thalassemia will have an Investigational New Drug filing in mid-2024 and enter human trials later that year.
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They finished the quarter with $328.3 million in cash, enough to take them into mid-2024. GRPH is a Buy under $9 for a $50 target in 2023, $100 in 2025, and then higher.
Primary Risk: Their drugs fail in the clinic.
Clinical stage of lead product: Phase 1
Probable time of first FDA approval: 2025
Probable time of next financing: Mid-2024
Inovio (INO – $2.46) reported a June quarter loss of 46¢ per share, 15¢ worse than the consensus estimate for a 31¢ loss. But on the conference call (SLIDES HERE and TRANSCRIPT HERE), the new CEO said their layoffs and cost savings have extended their cash runway into the September quarter of 2024, with a $73 million cash burn in the current quarter decreasing steadily over the next two years.
The INO-4800 program as a booster for any COVID-19 vaccine continues to progress:
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We will get the second Phase 3 trial results for VGX-3100 at the end of this year or early next year, but they may need to do an additional trial before they can file for approval.
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The company ended the quarter with $348.1 million in cash, enough to get them through several major data points and a drug approval. INO is a Buy under $7 for a very long-term hold.
Primary Risk: Their drugs fail in the clinic.
Clinical stage of lead product: Phase 3
Probable time of first FDA approval: 2023
Probable time of next financing: Mid-2024
Invitae (NVTA – $4.51) reported a June quarter that gave Wall Street what they wanted, and the stock shot up 276% yesterday, then fell 48% today. What is going on?
First, the results. Revenues were up 17.4% from last year – good growth – to $136.6 million, just above the $136.05 million consensus. Total active healthcare provider accounts grew 25% from last year to 20,217. They lost 68¢ per share, much better than the consensus estimate for a 76¢ loss. The pro forma gross margin jumped to 40.1% from 36.6% in the March quarter and 35.4% last year. Wall Street wanted to see progress towards the company’s goal of 50% gross margins, and they got it.
The Street also wanted to see a steady reduction in the quarterly cash burn, and they got that, too. The June quarter cash burn was $147 million, down $22 million from the $169 million in the March quarter.
On the conference call (SLIDES HERE and TRANSCRIPT HERE), the new CEO reaffirmed 2022 guidance for low double-digit growth. Over the longer term, they expect to post a 15%-25% growth rate after 2023.
Management mentioned the recently updated National Comprehensive Cancer Network guidelines, which now endorse universal germline genetic testing for all patients with colorectal cancer. They estimate that in the US alone, the colorectal cancer germline testing patient population will more than double. Invitae has additional efforts underway to do the same for breast, prostate, and lung cancer that have a larger patient population.
In oncology, Invitae is the leading genetic testing provider offering both germline and somatic assays, An increasing number of studies presented each year at the American Society of Clinical Oncology and other major clinical meetings are delivering more and more evidence that indicates the combination of germline and somatic information yields earlier diagnosis, more actionable results, ongoing monitoring, and potentially better outcomes.
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The June 9 short sale report showed an increase from 50.43 million shares to 51.78 million sold short, or about 23.7% of the float. That’s about four days of the average daily volume for the last three months, which isn’t usually short squeeze territory. NVDA is not a “meme” stock and there was no coordinated effort by Wall Street Beats to squeeze the shorts. But the results triggered some buy programs that had been waiting to see if the new management would deliver, then some shorts covered, then the day traders piled on, then the shorts panicked. So the stock nearly quadrupled yesterday and fell about 48% today.
As I’ve been posting, I’ve been steadily nibbling on NVDA in the $2-$3 area to lower my cost basis and I am not selling a single share. As I said on the Comments: “The important message from the NVTA report and call is that the new CEO is serious about cost cutting, getting the profit margin up, and still delivering growth.
“NVTA has 60+ pharma partners paying for tests to find clinical trial candidates for drugs being developed for diseases with a genetic cause or component. Once approved, doctors will use the same test (paid for by insurance, VA, or Medicare) on patients with symptoms to be sure the drug is appropriate.
“Meanwhile, NVTA accumulates the data (with patients’ permission) to build the world’s most valuable genomic database. I don’t think anyone can catch them.”
Invitae ended the quarter with $737 million in cash and is targeting cash flow breakeven without any more equity raises. Buy NVTA under $10 for a first target of $50 and eventually $100+ when they become the Amazon of genetic testing.
Primary Risk: A competitor starts taking significant market share.
Clinical stage of lead product: NM
Probable time of first FDA approval: NM
Probable time of next financing: Not needed
Medicenna (MDNA – $1.00) did a truly awful stock offering. They priced 13,333,334 units of one share and one five-year, $1.85 warrant at $1.50, which wasn’t terrible. But Guggenheim Securities and Bloom Burton Securities, the co-managing underwriters, placed the deal so badly that the stock dropped 46.6% on Tuesday to under $1 a share.
The way these deals are supposed to work is the underwriter only fills 50% to 80% of each institution’s order, creating after-deal demand to support the stock price. Some hot money funds will try to sell the stock at the deal price, giving them a free ride with the warrants. If a fund tries to play that game with a powerhouse firm like Goldman Sachs or JPMorgan, they will find themselves frozen out of future deals. With weaker firms like Guggenheim and Bloom Burton, the hedge funds can run right over them – as they did here.
Medicenna is not worth less money just because they added $18 million to their cash hoard, and I expect the stock to work its way back up over $1.50. I bought a starter position today. We will get updates on the MDNA11 program throughout the year and, of course, a partnership announcement for MDNA55 would put the stock over $3 immediately. Buy MDNA under $3 for a first target of $20, then maybe $40.
Primary Risk: Their drugs fail in the clinic.
Clinical stage of lead product: Entering Phase 3
Probable time of first FDA approval: 2023
Probable time of next financing: mid-2022
Biotech MegaShift
TG Therapeutics (TGTX – $7.52) reported a June quarter loss of $40.5 million or 30¢ per share, much better than last year’s $78.5 million loss or the 47¢ loss expected. On the conference call (TRANSCRIPT HERE), CEO Michael Weiss said: “During the first half of the year we implemented a number of cost-saving measures, and we are pleased to report those efforts have resulted in a lower than expected 2Q burn, which we believe puts us in a good financial position as we approach the potential launch of ublituximab.”
The Chief Commercial Officer said: “Over the last several months, we have significantly strengthened our core capabilities and commercial team, making critical hires in key roles. Recently, we added two general managers for our sales and access teams. Both of these key hires come from major MS companies, each with 10-plus years of field-based execution experience in the MS market.
“They joined our previously hired field-based regional marketing team and medical teams and we will continue to build up our field teams under their leadership over the next few months as we approach our PDUFA date in December. We currently have approximately half of our field-based team members hired and we will continue to hire over the coming quarters in the key areas of sales, access, and medical.
“We have been able to attract exceptional talent and we continue to receive an incredible amount of interest from people wanting to join our outstanding team as our momentum builds towards this launch. People see the opportunity to make a difference with ublituximab and want to work with the high-caliber individuals we have already hired and are eager to be part of what we are building. We are a small biotech company but we are laser-focused on the MS business and will undoubtedly be able to surround this drug with incredible and exceptionally talented and experienced people that truly care about patients.”
They had $231.8 million in cash at the end of the quarter, enough to carry them well past the PDUFA date to mid-2023. Buy TGTX under $7 for a target price in a buyout of $25 or more after the MS drug is approved.
Primary Risk: FDA turns the MS drug down.
Clinical stage of lead product: Filed for approval.
Probable time of next FDA approval: September 28, 2022
Probable time of next financing: March 2023 quarter
Biotech & Digital Dominators MegaShift
There are at least four ways to make money in the stocks of these large, growing, dominant companies. You can:
* * Buy a stock and hold it
* * Buy a stock and write a call option against it
* * With a Level IV options account, write an out-of-the-money put option
* * With a Level IV options account, write an out-of-the-money put option and use part of the premium to buy an out-of-the-money call option
Meta Platforms (META – $177.49) may be on to something really big. A recent study in Nature Scientific Reports showed that a group virtual reality experience called Isness-D showed the same effect as a medium dose of LSD or psilocybin (the main psychoactive component of magic mushrooms) on four key indicators used in studies of psychedelics. META is a Buy under $250 for a $400 target in 2023 or 2024.
SoftBank (SFTBY – $20.50) reported June first quarter revenues up 6.3% from last year to $11.85 billion but a massive write-down of Vision Fund investments led to a $23 billion or $14.70 per share loss.
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On the conference call (VIDEO HERE and SLIDES HERE and TRANSCRIPT HERE), CEO Masayoshi Son said: “When we were turning out big profits, I became somewhat delirious, and looking back at myself now, I am quite embarrassed and remorseful. Now seems like the perfect time to invest when the stock market is down so much, and I have the urge to do so, but if I act on it, we could suffer a blow that would be irreversible, and that is unacceptable.”
Instead, he said he would go into “defense” mode by cutting back on investments and preserving cash to weather the downturn. The company already sold its stakes in Uber and Opendoor Technologies for a total of $5.6 billion. They are selling their 9.0% stake in SoFi and cashed in one-third of their Alibaba shares for $34 billion. We bought Softbank at a 50% discount to its hard book value because that gave us a huge safety moat, and it’s working right now. They authorized a new $3 billion stock buyback program.
If the stock weakens, I think Masa might take Softbank private with a $30-$35 per share bid. I hope not, because I expect the Vision Fund tech investments to bounce back strongly over the next few years. SFTBY is a Buy under $25 for a first target of $50 in the next two years.
Other Tech
Liberty Media Acquisition Corporation (LMACA – $9.88) has until January 26, 2023 to consummate a business combination or they have to redeem our shares for $10 each. They don’t want to do that, so they’ll have to announce a deal not long after Labor Day to get the necessary shareholder votes scheduled. LMACA is a Buy up to $10 for a $20 to $30 target after a merger is announced.
Primary Risk:No deal is announced by 1/26/23 and we have to redeem for $10 a share.
Probable time of next financing: None needed
Rocket Lab USA (RKLB – $5.86) reported June quarter results after the close today. Revenues were up 391.8% from last year and 36% from the March quarter to $55.47 million, well ahead of the $49.24 million consensus. They lost eight cents a share, missing the consensus by two cents. On the conference call (SLIDES HERE and TRANSCRIPT HERE), management guided September quarter revenues to $60-$63 million, again well above the $54.4 million consensus. Pro forma gross margin should increase to 22%-25%.
In addition to their Investor Day on September 21, they are doing a full court press on brokerage firm conferences:
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Rocket Lab ended the quarter with $546.6 million in cash. RKLB is a Buy up to $13 for my $30+ target as low earth orbit satellites and space exploration grow.
Primary Risk: A new competitor emerges.
Probable time of next financing: None needed
Velo3D (VLD – $5.32) reported June quarter revenue up 174.7% to $19.64 million with a pro forma loss of 10¢ a share. The revenue increase was due mainly to a more favorable mix of Sapphire XC system sales, resulting in an increase in average selling price. Their recurring service revenue was in line with forecasts and is expected to increase in the second half of the year due to the higher number of systems in the field.
On the conference call (SLIDES HERE and TRANSCRIPT HERE), management said they booked $18 million in new orders in the quarter and now have a total backlog of $55 million. The CEO said: “As a result of this strong demand, we now have significant visibility in achieving our revenue guidance this year as more than 95% of our 2022 revenue forecast is now either recognized, booked, or recurring revenue…Looking forward, given our first half execution, strong second-quarter bookings, revenue visibility through our backlog, and the further scaling of Sapphire XC production, we are very confident in our ability to meet our 2022 revenue guidance of $89 million [up 225% from 2021 – MM].”
Their only problem is component costs from supply chain hiccups. They said ongoing supply chain challenges have changed the timing of some forecasted cost reduction benefits that will impact gross margin in the second half. Bill of material cost savings that were expected in the next two quarters are now expected to be delayed until the March 2023 quarter as they use up pre-purchased, higher-cost inventory acquired in the first half to offset ongoing component shortages and delivery delays. This is a transient problem.
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Management said they are on track to be the industry leader by the end of 2022. They are competing in a different market than legacy additive manufacturing (AM). Their ability to print high-value parts in a variety of metals lets them focus on parts not possible with traditional AM.
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They ended the quarter with $142 million in cash, enough to carry them through 2023. VLD is a Buy up to $6 for my $50 target as Velo3D’s high-tolerance metal parts printing business grows.
Primary Risk:A new 3D metal printing competitor emerges.
Probable time of next financing: None needed
Inflation MegaShift
Gold ($1,802.40) jumped on the CPI number and is holding around $1,800, but still needs to get back over the 38.2% retracement level at $1,842 to believe this enormous amount of fractal energy can drive the yellow metal to new all-time highs.
Miners & Related
Sandstorm Gold (SAND – $6.01) announced record June quarter results after the close today, but the conference call is Friday morning, so I’ll cover that next week. They had record attributable gold equivalent ounces of 19,276 ounces, up 7.1% from last year. Revenues grew 36.4% from last year to a record $36.0 million thanks to the increase in attributable gold equivalent ounces sold and a 4% increase in the average realized selling price of gold.
Their average cash cost per attributable gold equivalent ounce was $273, resulting in cash operating margins of $1,593 per ounce. Based on their existing royalties and contingent on the completion of the Nomad acquisition, they are forecasting attributable gold equivalent ounces for 2022 between 80,000 and 85,000 ounces. Subject to the conversion of the Hod Maden interest into a gold stream and the closing of the Nomad acquisition, they expect 2025 attributable gold equivalent production of 155,000 ounces. SAND is a Buy under $10 for a $25 target.
Primary Risk: Prices of precious metals fall due to US dollar strength.
Cryptocurrencies
Cryptocurrencies are a diversifying asset that offers a unique opportunity to make (or lose!) a lot of money quickly. You can easily buy Bitcoin and other cryptocurrencies at Coinbase, Block, or Robinhood.
Bitcoin (BTC-USD on Yahoo – $24,154.67) also rallied on the CPI print and looks like it has strong support around $23,000.
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BTC-USD, ETH-USD, GBTC and ETHE are Strong Buys.
Primary Risk: Bitcoin falls due to over-regulation or is surpassed by another cryptocurrency.
Oil – $94.17
Oil closed at a weekly high today, even though we are suppressing oil prices with a million barrel per day Strategic Petroleum Reserve releases that end next month, plus temporary China lockdowns. Gasoline demand probably is higher than the official numbers, which lag changes both up and down. Products in storage are very low. The value of refined products compared to the cost of crude oil – the “321 crack spread” – in North America drifted down from record highs, allowing the nationwide average retail gasoline price to fall a full $1 per gallon from its all-time high. (Per AAA data, retail gasoline is down to $3.990 versus a record high of $5.016 set on June 14).
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All of these factors indicate that both gasoline and oil prices are headed higher. The July 2026 Crude Oil Futures (CLN26.NYM – $53.16) are a Buy under $55 for a $200+ target.
The iPath Pure Beta Crude Oil Exchange-Traded Note (OIL – $33.03) is a Buy under $36 for an $80+ target.
Energy Fuels (UUUU – $6.98) reported June quarter revenues up 1,060.5% – you read that right – to $9.4 million. On the conference call (SLIDES HERE and TRANSCRIPT HERE), management said that during the quarter they entered into three long-term uranium sales contracts with US nuclear utilities. The base quantities under these contracts total 3.0 million pounds with deliveries to occur during the 2023 – 2030 time period.
If the buyers exercise all options, the total delivery quantities could increase to as much as 4.2 million pounds. Annual quantities vary year-to-year, with lower delivery quantities in the early years, and higher quantities in the later years. Contract pricing has a fixed price component (fully indexed to inflation) and a spot market component, along with floor and ceiling prices (fully indexed to inflation). They expect to fulfill deliveries during the early years of these contracts from their significant existing produced inventories.
In June 2022, the Department of Energy issued a request for proposals to buy uranium for the new US Uranium Reserve. The DOE expects to buy up to one million pounds from up to four qualified US uranium producers. The uranium must be physically located at Honeywell’s Metropolis Works conversion facility (the “US Converter”). Energy Fuels believes it meets all qualifications to supply the Reserve, and the company currently holds about 692,000 pounds of uranium at the US Converter. They submitted a bid to sell some uranium to the Reserve.
During the first half of the year, they produced about 205 tonnes of mixed rare earth element carbonate containing approximately 95 tonnes of total rare earth oxides. Energy Fuels’ rare earth element carbonate, which is roughly 32% – 34% NdPr (neodymium and praseodymium), is the most advanced REE material being produced in the US today. Nneodymium (Nd) and praseodymium (Pr) are the core ingredients for manufacturing permanent magnets used in high-efficiency electric motors and generators that enable low carbon technologies like wind energy, E-mobility, and many others. The demand for NdPr is expected to grow rapidly.
Energy Fuels finished the quarter with $98.2 million in cash and no debt. UUUU is a buy under $8 for a $30 target.
Primary Risk: Uranium prices fall.
* * * * *
RIP Olivia Newton-John
Physical, her 1981 hit, was the #1 single of the 1980s according to Billboard
* * * * *
Your visiting 20 cool websites Editor,
Michael Murphy CFA
Founding Editor
New World Investor
All Recommendations
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Uno…
Dos
Truthfully…is there anyone that didn’t “honestly love” Olivia at one time or another ? RIP
OH YES… I WAS 18 YEARS OLD . I WAS AT DISNEY LAND FOR A SEINOR GRADUATION OVER NIGHT PARTY WITH KIDS FROM EVERY HIGH SCHOOL IN THE STATE. THERE WAS A STAGE THAT ROSE FROM OUT OF THE GROUND. AND SHE WAS SINGING AND WE MADE EYE CONTACT. I THOUGHT I WOULD DIE. IT WAS 1974 AND I WILL NEVER FORGET IT. IT BROKE MY HEART WHEN I HEARD SHE PASSED. TRULY SHALL SHE RIP.
Reading how she lived harmoniously (if that’s possible) with her cancer diagnosis – rather than “fighting” and trying to win the battle against the dreadful disease as many say they do, she said her hope was not to not die, but rather to live everyday she had left normally, with happiness and joy, not focused on the disease but focused on living. How profound is that
For once I read the whole news letter instead of entering the contest = 4th ?
@Michaek Murphy, another outstanding Radar Report. Thanks for the “pep talk” on NVTA. I’m cringing as I anticipate 87000 more IRS agents. The administrations said that the target audits would be the same as now. That means 70% of the population with most under 75 K income and70 % total under 200K.Just complaining. Great news on UUUU orders. This is going to be a real ramp up phenomenon as both the pro and con Climate change folks are both interested. GLTA today and next weel even better.
Stop believing anything the US Govt. says in general and this administration in particular. Most people here are wealthy but probably not extravagantly so; according to what Brandon says they will not be targeted. Well, sorry, but they will be audited. With the army of (armed) agents they intend to hire they will go after anybody that has anything with the clear intent to confiscate what they can. This shakedown operation will use the 75,000 pages of the tax code to show you and your CPA made mistakes and now you owe more taxes and penalties. Good luck using the Tax Court for relief, the IRS always wins.
And a big thank you to the stoopid losers of the RINO Party for providing zielch opposition to the passage of this opprobrium.
I’m supposed to be avoiding this board but we have to put a stop to this Fox new talking point of 87k agents coming after the middle class.
https://www.verifythis.com/article/news/verify/taxes-verify/irs-not-increasing-audits-hiring-87k-new-agents-through-inflation-reduction-act/536-477cb699-a46e-4898-9e5e-0e48d5fffd2a
Note that Biden could “possibly’ place 87k agents in TEN years but 50k are retiring and Biden ain’t going to be around past 2024.
Try to fact check Fox before posting, always a good idea.
Good luck with your future audit. Just remember, the agent that will show up (armed) will turn out to be “Mr. GoodGuy”; however, even if he/she says that you MAY not owe anything, the final decision will be made by his boss or his boss’s bosses who, in all likelihood , will not have read the report and conclusions and will just confirm you owe back taxes and penalties because they say so (remember, it is a shakedown op). But I am sure that, being a staunch Democrat, you will be very happy to pay with a smile.
Repost from previous board.
Donald Galamaga
August 12, 2022 12:35 am
Good evening all: NVTA. To be fair to all re our conversations about memes, Hedge predictions and plain value, I thought you would like this extended analysis and detail link within: Not Pretty.
What’s behind the Invitae stock roller coaster? Morgan Stanley weighs in | Nasdaq
0
Reply
JGMD
Reply to Donald Galamaga
August 12, 2022 9:46 am
Who is going to benefit more from NVTA as a company–patients or investors (cough, speculators)? I say the patients.
NVTA- The MS piece is conventional and does not add any value to understand what is happening here. Written by somebody just out of Business School.
As for MM “not a Meme stock” opinion, yes, of course NOT a Meme stock just behaving like one.
Anyway, congrats to MM for NVTA, RKLB and, especially, VLD.
JGMB, you are consistent. Constantly throwing NVTA under the bus.
We get it. You are a doctor. You know best. Yet you refuse to acknowledge the benefits of genetic testing that has very positively changed my family’s ability to address health care.
Why don’t you give it a rest?
Reread my recent posts on NVTA. It seems you don’t grasp the higher significance of my analysis. As an experienced Pharma rep/manager, you think that prognosis depends mainly on single magic bullets, whether drugs or genetic tests. Here’s the truth–epigenetic factors (gene expression or phenotype) are more important than genetic factors (solely genotype). Most people pay no attention to healthy living and rely on genetic testing to give them justification for being careless. If they don’t have the genes for breast cancer, they mistakenly think they won’t get cancer. Then they continue to eat junk and get obese, don’t take vitamin supplements, don’t exercise. Hopefully your family member follows a healthy lifestyle, and seeks the advice of a holistic practitioner who knows much more than the majority of mainstream doctors who merely prescribe drugs and order testing.
P.S. JGMD
Just don’t BUY any of the NVTA stock, that way we don’t have to hear your biased comments on why in your opinion their business model doesn’t work. Seriously, if you already know everything about pharma companies and stocks, why are you even here? To impress everyone about your bedside manner?
The value of NWI has been mostly from subscribers with real world experience. That includes you, who pointed out the incompetence of ARTH management in marketing. Most subscribers do not invest anymore in MM’s highly risky bio picks, having experienced the pain of ill-advised entry prices. There is also the value of astute economic/political analysis from a few subscribers. MM’s fractal analysis has value also.
MM : Thanks much for the helpful guidance on TGTX. Much Appreciated.
There’s a TGTX alert at 5:45am today regarding a class action lawsuit
Bought more APTO
MM – the complete responses and only $77 mil MC is compelling, why isn’t this one of the top 5? When do you see the price action happening, is December the first date?
You mentioned NVDA and NVTA in the same paragraph. I am assuming that was a typo?? Also appreciate your insight on the recent volatility. Holding the latter as well. And going after APTO next week.
A typo – twice, actually – now fixed. Thanks! The volatility is just a dramatic reframing of the future of NVTA by the longs and the shorts, amplified by computer bots and daytraders.
You mean NVTA
Yep. Bet you can guess what potential Buy recommendation I’ve been working on.
I own a lot of both NVDA and NVTA and mix it up myself.
So can definitely guess what you are working on. And it certainly is a BUY recommendation. Long term hold. The new N in the FAANG stocks.
MM:Should I consider ARTH a complete write off at this point or continue to hold ? Tried to sell but no takers…
I expect them to sell the company. I’m holding.
Unfortunately Norchi is involved and he made a complete mess of everything. I would not get your hopes up. Great technology. FDA approval. Norchi was on the one yard line and fumbled. One of the biggest disappointments ever – ARTH. Talk about snatching failure from the wings of victory.
Frank: I had really high hopes here, 350K shares unfortunately down the drain IMO.
Thanks!
There is still light at the end of the tunnel IMO. Thanks to the IRA there are numerous companies now with massive cash hordes and now have a pressure point to do something with it by the end of the year. Either by share buybacks , mergers or buyouts. Not to mention they are losing money with high cash on their books. At 8 percent inflation rates they are hard pressed to put some of that money into hard assets or it is going to money heaven. Just another reason stocks in general are heading up in the second half. ARTH is dirt cheap and they have an approved device by the FDA. Some bargain hunter is going to see that . Ok, now everyone of you naysayers, go ahead and beat me up. I can take it.
Are IRA funds available to these firms as working capital ?
I still own some, I hope you are right. However the complete lack of sales or rather just over $8,000 in the recent earnings release – really makes you wonder. What did we miss? The doctors have just resisted using the ARTH better mousetrap. Why? What is Norchi not telling us.
Johnson and Johnson has $32.5 Billion in cash on their books, Baxter has $2.9 Billion in cash on their books and Pfizer has $31.06 Billion in cash on their books. If Johnson &Johnson does nothing with that money and the inflation rate stays up around 8 percent the rest of the year , they will lose about 2.5 Billion just from the effects of high inflation. Like Doc said several months ago, ARTH is a small company. There is a huge concrete wall of resistance for buyers at hospitals etc. to do business with them. If J&J or some other big pharmaceutical company even leaked a rumor that they were interested in ARTH the tide would change almost instantly. IMO
I wrote a few months ago about how AC5 variants were considered only investigational. I learned this only recently from a YMB poster. It’s hidden in company documents. Where was MM? So the ARTH fiasco is only partially TN’s fault. I judge the political bureaucracy to be MORE at fault. What crap–AC5 is better than any other wound care product, but political forces from the inferior competition keeps the AC5 only investigational. ARTH will continue to have only small sales as long as the product remains investigational. If Big Pharma has the political pull to overturn the investigational status, then ARTH can be bought out, maybe at 2-3x the current price, or 10-12 cents.
AC5 is an approved device – not investigational.
True, but the variants were smartly developed for many different applications. So why isn’t the original AC5 selling much at all?
When an insurance company refuses to pay for a test, they use the “investigational” label as an excuse. For AC5 variants, “investigational” is applied to exempt the insurance company from paying for it. A common example is the blood test for homocysteine. Many insurance companies don’t pay for this test. They are LIARS who don’t understand the basic biochemistry of homocysteine. It is NOT investigational to anyone with the proper understanding. Its value is as a risk factor for vascular disease. Homocysteine is elevated if there are functional deficiencies of B12, B6, methylfolate. Genetic tests can be done for mutations in enzymes that affect levels of B12, B6, methylfolate, but they are not as useful as the homocysteine test which reflects the bottom line gene expression. This is why I value tests like homocysteine over gene tests for this particular assessment.
For proper marketing of AC5 variants, a Big Pharma taking over ARTH needs to say to patients, “Look, insurance doesn’t pay for this state of the art product. It costs $1000 (or whatever). Do you want to be stupid, shortsighted and say you won’t pay for anything not covered by insurance, and lose your limb after you pay tons more in out of pocket costs and suffer for years with crummy out of date wound products and barbaric surgical procedures? Or worse, let your decubitus ulcer penetrate into your body, and then you get septic and DIE from outdated care?”
Unfortunately the end is very near for ARTH. The company is on hospice care.
They are nearly out of money and have no way of raising more funds.
I still cannot understand why this device was not successful. Unfortunately this is just about over. The end.
The scenario won’t be a buyout, it will be a Chapter 11 or Chapter 7. THEN an interested party such as Baxter or JNJ will take a serious look at it.
Unfortunately I don’t see how the investors will get anything. Norchi is probably talking to someone regarding the sale of the company right now, and is negotiating what HE can get out of the end of ARTH. He is not going to negotiate any return for the shareholders, he will take care of himself first.
Right. However, if a Big Pharma did what I suggest in my last paragraph, maybe in gentler words, the great AC5 products would succeed in the marketplace. But the business model of all Big Pharma companies is to get insurance companies to pay for everything, with patients paying only a modest co-pay. This is a commie-socialist plan, because in reality all insured consumers pay grossly inflated costs and this is a big reason why insurance premiums are exorbitant. In the end, Big Pharma will scoop up ARTH at scrap junkyard prices, and 99% of investors will get nothing. TN will be the principal beneficiary of the remaining scraps. Socialism–sacrifice the masses so that the very few at the top take all the benefits.
MM & All – what’s a good lithium stock play (ETF) or am I too late to get in? Is Uranium and equally compelling investment?
ETF is a canadian mutual fund, so you might want to take a look to see what you can see about their content. Meanwhile I suggest you take look at VisualCapital, also in canada. It is a free site which takes data and turns it into visual form on many topics, mostly for investing. There look at subsets on the top of the their opening page on mining and other related topics.
The problem is that there are two forms of “Lithium stocks”: Those that dig up and those that convert into rare metals plus some who do both. China has a lot of raw material and leads in processing phases which is worry-some to say the least. Some Canadian actual prospects hold hand in the USA and at least one is angling for US Governments funds to develop land in the USA.
I have another older list of “Lithium Stocks” of which he top two are interesting in several ways – both are on US listed markets even though one is a Chillian firm. Both are US listed and mine more than lithium.
I hold shares in both.
Both are active in Australia. which is the main new source of the raw material.
You should know that lithium comes in two ways: One is found in lake water and the other in solid residue of lost such lakes. I think the lake water is the less important.
In short, the situation of lithium (and some other rare earth material) are in a multiyear evolution when it comes to the electronic vehicle producers.
The reality of making our goals for lithium-vehicles is not good in my mind.
Sorry to be so long – and I have left out a bit
There is an article at SeakingAlpha titled “Intel: Turnarrooung Starts in 2025” which offers a totally different view of delays in technology will delay a lot of the needed capabilities for the parts for those hi-tech vehicles.
I downloaded it even though I have no membership there.
Thanks jcs – so is lithium or uranium the better investment?
The wrong question? Remember Uranium is a nasty word to the clean earth crowd, who will only like it when they get cold – but in the longer term only.
Never invest in a theme without spelling out your profile as an investor.
Me, I’m too old for a uranium stock. But will I play Lithium providers/processors and maybe both short and long. Think also about firms that use lithium (and other rare earths in clever ways.
Visit “VisualCapital” for an education……
lithium does not damage the environment Why would the clean earth crowd oppose it ? It is used in ev cars which is good for the environment
Please validate sentence one. Clean cars burn Electricity; how does it get generated?
A lot of “advocates” have emotions, not PHDs in science.
Look at LTHM for lithium stock
Good idea.
MM, what do you think?
Not too late INMHO
MM: Why do you prefer LMACA over LMACU (with 1/5th of a warrant) for Liberty Media Acquisition Corp. given the. very small price differential?
Great article – link below – on RKLB. Read the part about the Rutherford rocket engine and the 3D printed components. This plays right up into VLD. I have been adding to my positions in both stocks. Long term hold with huge upsides in stock price. Hopefully this link works to read the story from August 15, 2022.
https://stocks.apple.com/AoCywFtSrSoaq_WWV341VuA
Rocket Lab to Launch 150th Satellite on Upcoming Mission for hopefully
Frank – how does this article on RKLB have anything to do with VLD?
In the article. It is stated that RKLB uses the “ 3D printed” Rutherford engine. VLD is specializing in the 3D printers and producing aerospace parts. I did not state they are working together but this article supports the exciting growth potentials of both business models.
By the end of 2022 VLD will be the dominant supplier of 3D printed aerospace components.
Both companies are at the beginning of this “new” / fast growing space industry.
Logical assumption at the current prices of their stocks, you are close to ground floor of these developing businesses.
the article is a strong endorsement of both companies and their investment potential.
Same situation as when Apple launched the iPhone. How many other related companies in components, competitive products, apps, etc etc etc. became successful due to the new product and category Apple created.
to me, the RKLB article supports an investment in VLD.
or do you see otherwise and no correlation?
Sounds reasonable. My only question is what VLD bear Lazerator claims on YMB–a GE machine can do what VLD can do. A wild card and big bullish factor for VLD is Elon Musk’s SpaceX using VLD. Lazerator claims that VLD sold their machine to Musk at a loss to get attention. So is VLD the undisputed leader in state of the art 3D printing? Is GE a competitor?
MM?
Also, which company did the 3D printing for the Rutherford engine? If VLD, great. If another 3D company, then VLD is dependent on Musk. But how about GE instead of VLD?
ARTH- Lots of comments from a diverse group of people. Most of their conclusions are legitimate but feel stale as they were discussed here for 7 years ad nauseam by yours truly and others, JGMD, Don and others and by MM in his answers. At the peak, when the little pos was trading often at $.86 in 2016/2017 I held a large position that was mostly sold at a loss in the last 2 years. Imho, this immense failure came chiefly from 2 reasons, lets call them original sins. #1. Norchi conceived his puppy at his kitchen’s table so to speak. Nothing wrong with that as many new companies are started there or in a garage. However, he managed to go public via a reverse merger with a failed or failing public company and was able to find a motley group of wealthy but sketchy investors to function as the main source of funds of all of his financings bypassing Investment Banks such as Roth or larger bracket firms and VC firms altogether. Now, TN’s advantage in doing so was to find seed funds while at the same time be able to retain a very LARGE percentage of the company for himself. The long run negative effects of this decision were evident once the FDA approval was obtained and he sent NDA packages to large BioPharma companies to explore a merger/investment. Despite its clear innovative qualities, AC5 did not generate any interest with these JNJ type of companies and no bids came ARTH’s way. The presence of a Partner from Sequoia or Kleiner Perkins on the Board would have made a big difference under those circumstances; JNJ’s CFO does pick up the phone when KP calls in. The original group of “life sciences” expert investors turned out to be a bunch of total losers with no connections whatsoever. So, TN, out of greed and self-centeredness decided to keep 40% of ARTH instead of 4% and now he enjoys 40% of nothing. Good job.
#2. The AC5 original patents came from MIT. TN bragged continuously for years about all the work he did on the patents front. Maybe so, but while he was protecting ARTH’s turf he was investing very little in actual science and technology to expand the company’s actual portfolio and value. Through his constant dilutive financings he was able to mostly raise funds for current expenses and most prominent on the P/L was his and the CFO’s gargantuan salaries. This has to be considered an anomaly as most startup entrepreneurs go years without a salary. Norchi and Davis instead pillaged the company’s checking account every month from the getgo, leaving precious little funds to finance expensive Science/Lab work to expand the company’s technology. Of the 2 original structural problems, this is the one that makes ARTH look like a very marginal situation, potentially fraudulent, though probably still legal as TN was very careful with all of his paperwork and Board approvals over the years.
All true, which explains why the approved original AC5 didn’t sell. But the AC5 variants are good applications of the original AC5, but they will never sell because of the sabotage designation of them as “investigational.” I am 1000x more angry at the insurance system than about TN, as I said in my last post. People are indoctrinated that insurance must cover every medical cost, and they won’t spend their own money but will scheme to use other people’s money (insurance) to get benefits for themselves. Hopefully there are a few wise patients who will benefit by spending their own money on AC5 products, and save their lives.
Well said. Nailed it! All I can add is “ The End. “.
well done.
@Michael Murphy and all. Back at my opportunity hunt and also projection of energy bump by NWI this fall or so. Have read a lot about the politics of ESG and how it has killed the stock prices of energy companies, mostly fossil, by getting poor ESG ratings and unable to get loans for operations and exploration by Banks under the constraints of the admnistration in DC. Listened to and read an WSJ interview by this guy, Ransarwavy (sp?) of addressing ESG constraints by an ETF STRIVE that would address these capital raising issues for energy companies. I sold a couple of my good energy stock TPL and bought a good amount of DRLL, as a medium term investment that I see performing both for the Energy stock and for the booster. There are some negative reactions about STRIVE as being a loser, Here is one of a good number of search results FYI. Please LMK what you think.
Strive’s Flagship U.S. Energy Fund DRLL Exceeds $100 Million Within First Week of Launch (yahoo.com)
Quicklogic Corp Filed for Mixed Shelf of Up to $125M.
Stock has dropped to $7.30 in after hours trading.
The Radar Report for 8.18.22 is posted.