Dear New World Investor:
March quarter earnings reports so far are pretty good, with the notable exception of Netflix. Our stocks start reporting next week with the big guys – Apple, Corning, Gilead, and Meta – going first, as usual.
May 9 is the major Russian holiday marking their defeat of Nazi Germany in 1945, at the end of WW2. It would be a good day for President Putin to declare victory in Ukraine, and announce a cease-fire with a pulling back of Russian troops to Crimea and Donbas. Ukraine President Zelenskyy then could declare victory and announce a cease-fire to be followed by peace talks. We’ll see.
Lumber, trucking, used cars, and international ocean freight are the four horsemen of the current inflation. They all are rolling over.
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Consumer sentiment, which has been weighed down this year by rising prices, has shown signs of recovering from a nadir. The University of Michigan’s closely watched Survey of Consumers Index unexpectedly rose to 65.7 in early April, which while still depressed compared to pre-pandemic levels, was up nearly 11%, compared to the prior month’s more than 10-year low.
There is plenty of money around to keep prices rising, but people seem to want to hold on to it. US household cash now exceeds debt for the first time in 30 years, with net debt collapsing to zero. As long as they don’t spend it, the velocity of money falls and offsets some of the upward price pressure of the Fed’s past money printing.
They don’t seem inclined to invest it, either. This morning’s Stock Sentiment Survey from the American Association of Individual Investors showed only 18.9% bulls compared to the historical average of 38.0%.
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Last week’s 15.8% reading was the lowest reading since September 1992. The spread between bears and bulls has deteriorated to below the levels seen during the virus panic in March 2020. The market will be much higher before they decide to get long again.
The hysteria over the Treasury 10-year note yield minus the two-year note inversion predicting a recession has died down. The blue circle on the graphic below shows the entire time the two-year had a higher yield than the 10-year. Trivial.
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The S&P 500 gave up a big gain this morning – thank you, JPow! – and added only one point since last Thursday. It remains below its 200-day moving average at 4496. The Index is down 7.8% year-to-date. The Nasdaq Composite lost 1.3% as tech stocks took a hit with Netflix. It is solidly in correction territory, down 15.8% for the year. The small-cap Russell 2000 dropped 0.7% and also is in correction territory, down 11.3% in 2022.
So who is buying? Insiders. I can’t remember ever seeing the ratio of sales to buys this low.
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I’m not sure who still needs to hear this but…the start of Fed rate hikes was not historically a reason to sell, beyond the initial couple of months of volatility.
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The fractal dimension showed even more consolidation. There is a huge amount of energy stored up for a big move, and I think there’s enough sideline cash to predict it will be up.
Top 5
Changes this week: Removed TGTX due to their drug withdrawal. Added FSLY for May 12 Investor Day
Near-Term – chronological order
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
FSLY Fastly – May 12 Investor Day
FB Meta – Bounce from overdone selloff
Long-Term – alphabetical order
ARTH Arch Therapeutics – High-value wound care and hemostat for surgery
CWBR CohBar – mitochondria drugs and life extension
GRPH Graphic Bio – second-generation genetic editing
NVTA Invitae – the winner-take-most of genetic testing
FB Meta – a leader in the metaverse
Virus Update
Worldometers now shows 507,390,109 worldwide confirmed infections, of which 465,963,601 have run their course. Of those, 459,729,315 recovered and 6,234,286 died – a new low case fatality rate of 1.3%
In the US, there have been 82,490,352 confirmed infections, of which 81,326,949 have run their course. Of those, 80,309.826 recovered and 1,017,123 died, matching last week’s new low case fatality rate of 1.3%.
Some really good news: The moving average case fatality rate has plunged to 1.1%.
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Daily cases still are very low, but up 38% from the April 2 low of 28,119.
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Hospitalizations are under 10,000.
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Daily deaths are down to 302.
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Dollar Death Watch
Hedge funds are back to being heavily exposed to the US dollar. It worked out okay for them in the summer of 2014, but other than that, not so much. The dollar is trading at the highest level since May 2020, but with a long-term range since 2015 that tops out at the $100 level we probably are getting close to a dollar reversal. That will help gold.
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Coming Events
All times below are ET, and most of the presentations and slides are archived on the companies’ websites so you can listen to them.
Monday, April 25
SCYX – ScyNexis – Through 4/26 – European Congress of Clinical Microbiology and Infectious Diseases (ECCMID)
Tuesday, April 26
GLW – Corning – 8:30am – Earnings conference call
Short Interest – After the close
Wednesday, April 27
FB – Meta – 5:00pm – Earnings conference call
Thursday, April 28
AG – First Majestic – Through 4/30 – Investment U Conference
March quarter real GDP – 8:30am – +1.0% to +1.3% expected
GLW – Corning – 12:00pm – Annual meeting
GILD – Gilead – 4:30pm – Earnings conference call
AAPL – Apple – 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 typically are very low. At the same time, Initial Public Offering valuations have moved very high. We are 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. 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.
Antares Pharma (ATRS – $5.57) hasn’t attracted a higher bid yet, but last weekend was a major holiday. Let’s give any other potential acquirer another weekend to make a bid. If not, we’ll sell next week. I’ll send a Flash Alert. Hold ATRS.
Primary Risk: Xyosted prescriptions stop growing or other products don’t sell well.
Clinical stage of lead product: Approved
Probable time of first FDA approval: Approved
Probable time of next financing: Not needed
Invitae (NVTA – $5.44) should benefit from the FDA warning that genetic non-invasive prenatal screening tests like the ones Invitae offers may have false results. Invitae has the resources and technical skill to produce the best test while most of their competitors will have to go away. Buy NVTA under $50 for a first target of $100 and eventually $200+ 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
ScyNexis (SCYX – $3.14) announced a common stock offering after the close today, but they didn’t say how many shares. That probably means this is a “best efforts” offering – Guggenheim Securities will find out how many shares it can sell at what prices, and then ScyNexis will decide what the terms are. This is a weak form of offering and could hit the stock pretty hard tomorrow. It is down about 15% in aftermarket trading.
The company is presenting positive interim data from the ongoing FURI and CARES trials at the European Congress of Clinical Microbiology & Infectious Diseases (ECCMID) in Lisbon. There was one oral session, three company poster presentations, and five investigator-initiated study posters. Ibrexafungerp has a huge opportunity in hospitals.
The company announced additional commercial insurance formulary coverage for Brexafemme, which now has 93 million commercially-insured lives, 55% of the total available. Buy SCYX under $24 for a first target price of $54 now that Brexafemme is approved and a buyout at $170.
Primary Risk: Ibrexafungerp fails to sell.
Clinical stage of lead product: Approved
Probable time of next FDA approval: mid-2022
Probable time of next financing: 2023 or never
Biotech MegaShift
TG Therapeutics (TGTX – $7.42) withdrew their Biologics Licensing Application and supplemental New Drug Application for U2 to treat chronic lymphocytic leukemia and small lymphocytic lymphoma before tomorrow’s scheduled Oncologic Drugs Advisory Committee meeting. They also voluntarily withdrew Ukoniq, approved last year, from sale. They said the decision to withdraw was based on recently updated overall survival data from the Phase 3 trial that showed an increasing imbalance in overall survival against the drug.
On the conference call (AUDIO HERE) management made it clear that they will follow all current patients to see how the overall survival data plays out, but almost all of their focus will be on multiple sclerosis and the September 28 PDUFA date.
As I posted in the Comments, “I originally recommended TGTX for their MS drug. As the cancer drugs seemed to progress, I raised the target price. So I’m going to cut the target after Monday’s conference call, probably back to the original $25. The stock probably will get cut in half Monday to $4 or so, and will remain a buy for the lower target. I’m glad the market is closed today so no one could buy my ill-timed Top 5 recommendation.”
The stock only went to $6.02 on Monday, but I am cutting the target price back to $25 and the buy limit to $7. I agree with this SeekingAlpha author: TG Therapeutics: I May Double Down Again. Buy TGTX under $7 for a target price of $25 or more.
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: December 2022 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
Apple (AAPL – $166.42) reports March quarter results next Thursday. Analysts are expecting $94.0 billion in revenues, but that’s in a wide range from $90.0 billion to $100.4 billion, mostly depending on what happens with China sales and production. June quarter guidance is pegged at $86.66 billion in a range from $80.6 billion to $96.55 billion.
The company is expected to earn $1.43 a share, in a range from $1.34 to $1.56. June quarter guidance expectation is $1.25, in a range from $1.11 to $1.40. AAPL is a Hold for new iPhone rollouts and augmented/virtual reality products.
Corning (GLW – $34.64) reports Tuesday morning. The consensus is looking for $3.57 billion with 43¢ a share. June quarter guidance is expected to be $3.7 billion and 51¢. GLW is a Buy under $33 for the 5G cellular buildout, followed by the smartphone upgrade to use 5G services. My first target is $60 in 2022.
Meta Platforms (FB – $188.07) reports on Wednesday. Wall Street wants too see $26.28 billion in sales and $2.57 a share. They want to see guidance for $30.78 billion and $2.84. The stock fell in sympathy with Netflix because they were both high-fliers, even though the business models don’t overlap. Ahead of the earnings, Citigroup upgraded the stock from Neutral to Buy with a $300 target. FB is a Buy under $320 for a $400 target in 2022.
Gilead Sciences (GILD – $63.75) reports next Thursday. Analysts are anticipating $6.25 billion in sales and $1.80 earnings per share. GILD is selling for less than 10x this year’s earnings with a 4.6% dividend yield. That is stupid cheap. GILD is a Long-Term Buy under $105 for a first target of $130.
Other Tech
Rocket Lab USA (RKLB – $7.87) was selected by HawkEye 360, a radio frequency geospatial analytics provider, to launch three Electron missions. The first of the three missions in December will be their inaugural Electron mission from Launch Complex 2 on Wallops Island, Virginia. 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
Inflation MegaShift
Gold ($1,953.30) popped above the $2,000 mark early Monday before retreating back below $1,980 per ounce. Gold is up 6.9% year-to-date as investors shrug off surging real yields and a strengthening dollar to focus on political and economic risks. Gold buyers are piling into exchange-traded funds because they don’t think the Fed can cool decades-high inflation without hurting the economy. For them, gold is a hedge against soaring prices and low growth.
In addition, the seizure of about half of the Russian central bank’s foreign exchange reserves seems certain to create a new monetary paradigm where gold plays a greater role. In the short term, Russia is the world’s #2 gold producer and their gold sales are sanctioned – not that China won’t gladly buy all they can mine at a big enough discount.
The fractals show plenty of energy for a move to new all-time highs.
Miners & Related
First Majestic (AG – $12.25) said they produced 7.2 million silver equivalent ounces in the March quarter, consisting of 2.6 million ounces of silver and 58,892 ounces of gold. That’s 59% higher than last year thanks to the Jerritt Canyon acquisition, but 16% less than the December quarter because of high absenteeism due to COVID-19. Their realized prices should be higher, though. We’ll get full financial results on May 12. AG is a Buy under $15 for a $23 next target price as production increases and the price of silver rises.
Primary Risk: Prices of precious metals fall due to US dollar strength.
Cryptocurrencies
Cryptocurrencies are a diversifying asset that offer 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 – $40,741.59) is locked in a tight consolidation range that I expect to evolve into a move over $50,000 and then on to all-time highs.
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It’s important to remember that bitcoin isn’t just a currency, it’s also the world’s first decentralized digital payments network. Payments networks like Visa and MasterCard are highly valued. Bitcoin is even more valuable because it doesn’t require expensive middlemen like banks to process transactions, it’s more secure, and the supply is fixed – there will be only 21 million bitcoins ever.
The SEC approved a Teucrium bitcoin futures exchange-traded fund, suggesting that a spot bitcoin ETF will finally get the green light soon. When that happens. Bitcoin will rise and the Grayscale Bitcoin Trust (GBTC) will really jump. BTC-USD, ETH-USD, and especially GBTC and ETHE are Strong Buys.
Primary Risk: Bitcoin falls due to over-regulation or is surpassed by another cryptocurrency.
International & Other Recommendations
It is important to hold some non-US assets, especially in China. Chinese stocks have been hit hard by worries over the economic fallout from Xi Jinping’s Covid-Zero strategy of locking down key economic hubs, with lower-than-expected policy stimulus adding to investors’ disappointment. This, too, shall pass. The China Securities Regulatory Commission said this morning that it met with institutional investors like the National Social Security Fund, banks, and insurers to ask them to boost their equity investments. That’s usually the sign a rout is over. You can take advantage of this by putting 3% to 5% of your portfolio in:
EMQQ Emerging Markets Internet & Ecommerce ETF (EMQQ – $28.98) is a Buy under $38 for a $66 target in 12 to 18 months.
Primary Risk: China falls into a recession.
KraneShares Bosera MSCI China A Share Fund (KBA – $34.10) is a Buy under $34 for a three- to five-year hold.
Primary Risk: China falls into a recession.
Morgan Stanley China A-Share Closed-End Fund (CAF – $15.41) is a Buy under $24 for a three- to five-year hold.
Primary Risk: China falls into a recession.
KraneShares CSI China Internet Exchange-Traded Fund (KWEB – $24.79) is a Buy under $50 for a double over the next three years.
Primary Risk: China falls into a recession.
Acreage Holdings (ACRDF – $1.40) started adult-use operations in New Jersey in Egg Harbor Township and Williamstown. CEO Peter Caldini said: “After serving New Jersey medical patients for almost five years, we are thrilled to be among the first operators establishing New Jersey’s adult-use market. With New Jersey adult-use sales projected to reach $2.4 billion by 2026, The Botanist is well-positioned through our expanded cultivation capabilities to meet consumer demand and increase sales in the coming years.”
According to a recent study by MJBiz, legal sales of marijuana are expected to top $33 billion by the end of this year, a 32% increase from 2021. Annual sales are expected to exceed $52 billion by 2026. 37 states have approved marijuana for medicinal use, including 18 states and Washington D.C. that have also approved marijuana for recreational use. About 77% of the U.S. population lives in a state with some form of legalized cannabis.
Reading the tea leaves from Washington, analysts at Jefferies concluded on April 8 that “there is a good chance” that Congress will open the banking industry to marijuana firms in the “near-term.” That could trigger the Canopy Growth takeover of Acreage. ACRDF is a buy under $4.49 for a hold for the Canopy Growth merger and beyond.
Primary Risk: Canopy Growth does not acquire the company.
Oil – $103.80
The national average for a regular gallon of gasoline fell from $4.33 on March 11 to $4.07 on April 13 and then increased a bit to $4.11 yesterday. With the Russian sanctions biting a little harder and the summer driving season just ahead, I expect record gas prices by the Fourth of July.
The Energy Information Administration said US crude inventories declined by a whopping eight million barrels last week, more than 10x the estimated decline of 770,000 barrels. The global supply shortage continues to drive increased demand and higher oil prices.
JPMorgan said that if the European Union really implements a full and immediate ban on Russian oil it could displace more than four million barrels a day of supplies and push Brent prices up by around 65% to $185 a barrel. They think European leaders won’t be that dumb. Got OIL?
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 – $33.61) is a Buy under $24 for an $80+ target.
Energy Fuels (UUUU – $8.65) will benefit from a $6 billion Department of Energy program aimed at keeping uneconomical nuclear plants in service. US natural gas just hit a 13-year high with stocks 20% under normal due to LNG exports, a hot summer coming with high electricity usage for air conditioning, and utilities unable to switch from natty to coal for ESG reasons. Uranium is at an 11-year high. New highs are coming, and you will see triple-digit uranium soon. UUUU is a buy under $11 for a $30 target.
Primary Risk: Uranium prices fall.
* * * * *
Stealing from the Rich Today by John Dvorak
* * * * *
Your understanding the LNG market Editor,
Michael Murphy CFA
Founding Editor
New World Investor
All Recommendations
Check out the complete Portfolio page HERE.
Buys
These are the stocks everyone needs to own because transformative events are happening over the next year or two, and I expect to hold them long-term.
$20-for-$1
Aptose Biosciences (APTO – $1.12) – Buy under $4, ultimate target $45
Arch Therapeutics (ARTH – $0.08) – Buy under $0.70, first target $2, then $7
Bellerophon Therapeutics (BLPH – $1.95) – Buy under $11, first target $30, then $300
Compass Pathways (CMPS – $12.42) – Buy under $36, hold a long time for a 10x return
Graphite Bio (GRPH – $3.86) – Buy under $26, hold a long time
Inovio (INO – $2.87) – Buy under $21, hold a long time
Invitae (NVTA – $5.44) – Buy under $50, first target $100, then $200+
Medicenna (MDNA – $1.11) – Buy under $4, first target $40, then maybe $80
ScyNexis (SCYX – $3.14) – Buy under $24, target price $54, then $170
Other Biotech
TG Therapeutics (TGTX – $7.42) – Buy under $7, target price $25+
Tech Dominators
Corning (GLW – $34.64) – Buy under $33, target price $60
Meta (FB – $188.07) – Buy under $320, target price $400
Gilead Sciences (GILD – $63.75) – Buy under $105, target price $130
SoftBank (SFTBY – $21.25) – Buy under $30, target price $60
Other Tech
First Trust NASDAQ Cybersecurity ETF (CIBR – $50.10) – Buy under $32; 3- to 5-year hold
Fastly (FSLY – $17.07) – Buy under $45; 2- to 5-year hold to $150+
PagerDuty (PD – $29.60) – Buy under $40; 2- to 5-year hold
QuickLogic (QUIK – $5.04) – Buy under $10, target price $60
Liberty Media Acquisition Corporation (LMACA – $9.95) – Buy under $10.50, target price $20 to $30
Rocket Lab (RKLB – $7.87) – Buy under $13, target price $30+
Velo3D (VLD – $4.48) – Buy under $11, target price $50
Inflation
A Short-Sale or REO House – $375,300 – Buy while fixed mortgage rates are low
Bag of Junk Silver – $24.70 – hold through silver bull market
Sprott Gold Miners ETF (SGDM – $32.90) – Buy under $25, target price $50
Sprott Junior Gold Miners ETF (SGDJ – $43.36) – Buy under $39, target price $100
Sprott Physical Gold and Silver Trust (CEF – $19.39) – Buy under $15, target price $30
Global X Silver Miners ETF (SIL – $36.65) – Buy under $30, target price $50
Coeur Mining (CDE – $4.72) – Buy under $10, target price $20
First Majestic Mining (AG – $12.25) – Buy under $15, next target price $23
Paramount Gold Nevada (PZG – $0.65) – Buy under $5, first target price $10
Sandstorm Gold (SAND – $8.25) – Buy under $10, target price $25
Sprott Inc. (SII – $49.22) – Buy under $30, target price $70
Cryptocurrencies
Bitcoin (BTC-USD – $40,741.59) – Buy
Grayscale Bitcoin Trust (GBTC – $26.34) – Buy
Ethereum (ETH-USD – $2,983.57) – Buy
Grayscale Ethereum Trust (ETHE – $22.01) – Buy
International & Other Recommendations
EMQQ Emerging Markets Internet & Ecommerce ETF (EMQQ – $28.98) – Buy under $38 for a $66 target in 12 to 18 months
KraneShares Bosera MSCI China A Share Fund (KBA – $34.10) – Buy under $34 for a three- to five-year hold
Morgan Stanley China A-Shares Fund (CAF – $15.41) – Buy under $24 for a three- to five-year hold
KraneShares CSI China Internet ETF (KWEB – $24.79) – Buy under $50 for a double over the next three years
Acreage Holdings (ACRDF – $1.40) – Buy under $4.49 for the Canopy Growth merger
Mongolia Growth Group (MNGGF – $1.45) – Buy under $1.25; long-term hold
Energy
Crude Oil Futures – July 2026 (CLN26.NYM – $53.16) – Buy under $55, $200+ target
iPath Pure Beta Crude Oil Exchange-Traded Note (OIL – $33.61) – Buy under $24, $80+ target
Energy Fuels (UUUU – $8.65) – Buy under $11, $30 target
Holds
These are holds but not sells – yet. They could get moved back to one of the buy categories if their prices drop or outlook improves, or they could become sell recommendations in the future.
Algernon Pharmaceuticals (AGNPF – $4.61) – Hold for chronic cough results
Antares Pharma (ATRS – $5.57) – Hold for possible higher bid
CohBar (CWBR – $0.26) – Hold for human trials of CB5138-3
Akebia Biotherapeutics (AKBA – $0.47) – Hold for FDA meeting
Apple Computer (AAPL – $166.42) – Hold for 5G iPhones
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First?
Not what we want to see on NWI stocks.
MM–on TGTX, you said nothing beyond what is already written by YMB posters. Please address my question, now repeated a 3rd time about how the FDA is going to balance the better efficacy of Ublituximab with the worse side affect profile, and your experience with how the FDA balances the risks and benefits with other drugs.
“Balance” is the keyword. Ublituximab had only a slightly worse side affect profile. if at all, and very clearly more benefit. The FDA usually will approve a clearly better drug even if the side effect profile is a bit worse, but they could say no. I think the FDA will approve it and leave it to doctors to decide who should take it.
Ubli had severe adverse events of over 8% vs the other drug’s over 6%. They don’t say WHAT the severe adverse events were, and that is NOT “a bit worse.” I hope you are correct about the FDA’s balancing act, but I judge this to be a binary situation with a wipeout if the FDA behaves as it did with AKBA.
Repost of my remarks on SCYX at the end of the last board.
ROGERinSEATTLE
April 21, 2022 4:11 pm
SCYNEXIS Highlights Launch Of Common Stock Offering, No Size Disclosed.
I thought these guys had enough money to get well into 2023. Now trading below $3 after hours
1
Reply
JGMD
Reply to ROGERinSEATTLE
April 21, 2022 9:45 pm
They know that script numbers are basically flat. They will continue to mount staggering losses, mainly due to management bloated salaries for doing little. Another ARTH–plunging stock price in a death spiral. If they wait another 6 months, the offering price will be below $2 instead of below $3 today. I predicted all this.
MM–you are still cheerleading about SCYX. How do you feel about your recent purchase of more shares? Before Ibrexa is approved for hospital infections, SCYX will SINK FURTHER.
SCYX: My crude calculation: To raise $100M – which they might as well do since that’s only 1 (more) year of cash burn and the share base will explode in size anyway – would be 40M shares at $2.50 + 20M-40M warrants [5-10 year life] with an exercise price of $2.50-$3.00. Or possibly 50M shares at $2 with 25M-50M warrants around $2.00-$2.50. So there will be another 60M-100M shares+warrants along with the existing 40M +/-. Average new share base of 120M. There will probably be an overhang of new shares as the buyers get their cash back out and count on the warrants giving them a lottery win if the company ever does sell any product.
SCYX: Actual pricing: 15M shares + pre-funded warrants [shadow stock] at $3/share, each of which gets a warrant [15M total] to purchase 1 share at $3.45 over the next 7 years. Underwriters may acquire up to 4.5M shares / p-f warrants + warrants on the same terms.
So another 30M-35M shares onto the share base [now about 75M by my count] to buy maybe 6 months of cash burn. Stock bid $2.39 – down $0.75 / ~25% from the previous close, 20% from the placement price – an hour before opening. That seems pretty grim. At some point this may be a profitable investment for someone, but they probably don’t have to rush to get on board.
Another great Radar Michael Murphy. Thanks for your weekly work in keeping us informed or ready to talk, I did like your insight on the turn of the dollar. That, indeed, should push Mr. Goldie…up energetically. Poor Powell. I think he’s getting a lot of pressure from the White House to do something to jack up the polls. That’s gonna be a tough thing to do, IMHO. A bbit of a disagreement on Marijuana. Rather significant data that includes whatever happened after Colorado went recreational. I am very aware of the academic “studies” that pushed back on negative impact from use of MJ. The results of the Colorado study and a few more clearly indicate a lot of behavioral problems, serious mental illness is up to 25% of the vulnerable populations, and violence problems. The Berenson book of several years ago had predicted large problem results. One more fact is the modern MJ is not your mom’s MJ, I can see it nkw. Biggest Russian problem is Vodka drunks and the US now being truly stoned. Forgive my preaching, This looks serious. Hope I’m wrong
I agree,Don . That smoke is 10 times more harmful than cigarette smoke. Between smoking today’s pot on steroids and obesity, young people are going to be lucky to make it to 50. And the worst part is they don’t seem to care. They are all into self destructive behavior. Live hard and die young. More and more of them are mental basket cases, emotional train wrecks and can’t handle the challenges of the brave new world. Parents are doing a horrible job of parenting, schools are going nuts with critical race theory, gender identification. and teachers are paranoid about law suits if they take any action whatever to curb the stupidity that kids are doing in school . It’s some kind of crazy out there. I am glad I don’t have any school age children.
Fortunately, I was not in TGTX, tempting as their story was. For MS, I think the real answer will be NervGen’s Intracellular Sigma Peptide which will begin Phase 2 trials at the end of this year. Their drug (NVG-291) could be useful in a huge number of nervous system pathologies, but will first be trialed only in MS, SCI and Alzheimer’s. The share price has been under a cloud as trials are only proceeding in post-menopausal women due to sperm motility problems in some male patients. While I think the company is addressing that issue with the FDA (perhaps a bad batch of medicine and this being a really minor side effect for these conditions) the risk/reward calculation makes NGENF appear to me to be one of the best investment opportunities I have ever seen. If you are unfamiliar with the company, check out the experts who have chosen to be involved with the company’s Scientific Advisory Boards in the above 3 indications. These experts don’t need to waste their time with garbage medicines. Also go to youtube and search “NervGen” and watch their March 30, 2022, video
Thanks, I will look into NervGen. I don’t like lymphocyte depleting drugs such as TGTX’s. This is a recipe for immunosuppression with long term risk of cancer and other serious diseases. If TGTX gets approval on 9/28, sell.
Here is the newest news on NervGen:
https://www.youtube.com/watch?v=9paZgPPjn_c
Very informative. This is now phase 1 dose escalation studies, about to begin phase 2. What’s the cash burn? They are looking for grants to minimize dilution. Phase 2 data readout for MS/spinal cord injury/Alzheimers late 2023. What’s your investment strategy? Thanks.
In medical school in the mid 1970’s, I learned that incidence of MS was higher in northern latitudes. Much later the correlation was made with vitamin D levels, which are lower in northern latitudes.
I am very heavily invested and will buy more. For new investors, I’d advise buying now and adding on dips. The company will receive several $M from warrants expiring in 4 weeks for additional shares at $1.6CAD. I have a childhood friend who went to West Point and developed MS and died after crashing a plane in icy water in Alaska. Then again, I know people in Miami who have developed that crappy disease. I pray NervGen has the cure.
One, will we be able to buy shares at $1.6CAD from dilution? FDA sabotage by Big Pharma is always possible, but there are no Big Pharma drugs that do much. That includes TGTX.
Two, MS is a progressive autoimmune disease. NervGen may be able to reverse existing nerve damage, but the autoimmune process must be controlled in order to avoid progressive damage. Get the vitamin D 25 hydroxy level very high, 80-100 ng/ml, which suppresses the autoimmune activity. More involved detox and nutritional management are important. Similar approach for Alzheimers’ disease.
I am more optimistic about a cure for spinal cord injury, which is not a progressive inflammatory disease like MS and Alzheimers.
I can envision a real cure for spinal cord injury with an initial 2 week treatment, followed by periodic maintenance not too often. For the progressive diseases like MS/Alzheimer’s, the initial 2 or more weeks of treatment depending on the responses, followed by more frequent (compared to spinal cord injury) maintenance treatments to nip the new lesions in the bud. If they can nip the new lesions while they are small and clinically silent, there will likely be better long term efficacy and less side effects from smaller, more frequent doses.
I am confident that this Scientific Advisory Board is much more competent in trial design than that of any other spec bio company discussed here.
ACXP has great science, but why the lack of interest, shown by tiny trading volumes?
Michael is there an OIL eqivalent opportunity in LNG that you would recomend? Thanks
UNL, UNG, and GAZ are natural gas ETFs. The ETF with the largest allocation to Cheniere Energy (LNG) stock is USCF Midstream Energy Income Fund (UMI), with a portfolio weight of 8.9%.
Thank you.
Bought more SCYX on this dip far below the deal price.
Me too
Al Ekelmans
Bought ARTH at .74
Right now I would gladly sell you all my ARTH at .74. I think you meant .074, no?
Bought SCYX at 2.39
MM what deal price are you referring to?
Do you ever change your mind when fundamentals deteriorate, as I predicted many months ago? SCYX will go way below $2 before the drug is approved for serious hospital infections. Even when approved for serious infections, will management be any better at building sales for that, than at present for VVC?
Michael
What impact does this have for NVTA or any of our other biotech stocks?
BBC News – Cancer: Huge DNA analysis uncovers new clues
https://www.bbc.co.uk/news/health-61177584
The question is what % of cases where DNA analysis makes a difference in patient outcomes through targeted therapies. Look at the failure of BIOC with their liquid biopsies. The magic bullet approach of mainstream medicine is much less effective than improving lifestyle factors for cancer prevention. In plain English, stop stupid habits like smoking, alcohol, obesity. High levels of vitamin D are far more effective in preventing and even improving treatment prognosis. These lifestyle factors influence EPIGENETIC expression of the genes, which is more important than actual genes.
Hi Guys, I have a question on Crypto storing. I stored all my coins on Hardware Wallet called Ledger Nono S. Using Ledger Live application. Also I stored Cardano in Ledger NanoS using Deadalus software application. The PC that I had these 2 applications, has gone bad and no more working.
I have the keys to my hardware wallet and I am in procession my hardware wallet. If I install these applications ( Ledger Live and Deadalus) on my new PC, will I be able to access my coins from teh Hardware wallet? Or all the coins I stored on my hardware wallet are lost?
Thank you for all info. Any suggestions are welcome. If not here, where do you think is the best place to get the right answer. I do not want to attract any scams to my emails and so on.
Good question. When you determine the outcome, please post results as to whether or not the coins were lost or they were easily accessible in the hardware wallet using a different PC.
If you used other sources to help determine the outcome, please post those also.
Thanx.
@Michael Murphy and all, Been following TSLA tonight and looking for guidance this week on the sale of ATRS to use some of the benefit for adding my stake in TSLA. Here are two reasons right now:
Tesla CEO acquisition bid: Twitter begins negotiations with Elon Musk (msn.com) and
After plans of buying Twitter, Tesla CEO Elon Musk forms new super company ‘X Holdings’
Talk of split also in the air.
Could be fun
Louis Navellier recommends Ford, Toyota as EV plays.
I have been followers to what I called “Rothchilds”. They are stocks that service the elements (you and I) never see. For example, they might make car tires or light bulds – things the Ford and Toyota would not make, but must buy.
But now we have a different evolution.
Take Ford, who made part of their profits on things like motors and steel bodies. They now find a large portion of the cost/profit in a new-age car to be something that now flows to their new suppliers of the motive portion of the car even new metals for the lighter car body. They find a big portion of the parts that make their “profit” from is now found in portions of the car supplied for in a lighter powered motor subsystem.
This approach can even fall to the owners of their cars. You no longer hold a stock that benefit’s for your oil change oil and hardware.
In theory, this might apply to your “delivered diner” that replaces trips to the grocer – mileage plus edibles and stove heating. Even as you eat dinner, you might be eating up profits from your stocks in more way than one. (Takes a lot of other folks helping the system.)
Ford has 49 BILLION in pension obligations and they will cannibalize their pickup ice sales with electric ice trucks. Same with Toyota or any of the current car manufacturers.
Tesla has no union problems and have created a plug and play blueprint to create giga factories and have an ever expanding supercharger network. Nobody will be able to catch them.
I’m adding to TSLA on any weakness … like today.
No doubt TSLA is the leading EV, but it comes down to valuations of TSLA, Ford and Toyota. Only Ford and Toyota are on Navellier’s buy list.
Sorry, but I was only discussing their profit source situation. Clearly, profits will help reduce any debt – including write-down of obsolete equipment/facilities.
As to TSLA their future problem might be the COMPETITION.
MM, what is your position now on Nvta , Scyx. Is there any hope for these two or do we need to write them off.
I think NVTA is going to be my biggest winner ever. SCYX – short-term, depends on prescription growth, medium-term on approval for hospital applications. Longer-term a big winner as the dominate antifungal medicine.
This bear market is killing bio spec picks. NVTA will be a penny stock unless something miraculous happens.
Even in a decent market, spec bios even in a basket are a loser’s game. Most drug/device candidates even if approved (a long shot) fail in the marketplace, as we have seen with NWI stocks. Management often thinks it more prudent financially for them to collect big salaries as long as possible until the company goes kaput. Why should they take small salaries and put the balance into company marketing? Competent marketing is expensive. YMB poster Lemuel says that SCYX got screwed with shitty marketing from Amplity which was re-organized from the original marketing firm and the good salespeople left. In addition to the relative mediocrity of Brexafemme as only slightly more efficacious than cheap fluconazole, we have the shitty results from Amplity. That’s 2 shit blows to SCYX. It requires genius marketing to sell a mediocre drug. It is a new chemical entity, but it is not a great drug. Even the excellent AC5 of ARTH requires competent marketing which is absent at that company.
What happens if I don’t sell ATRS? Or I sell in my taxable account and hold in my tax free account? Is it still dead money on a long term basis? Thanks for your input.
Yes, it would be dead money. They will pay you $5.60 for each share now or in the future.
I guess I didn’t explain that well. I was thinking after the buyout is complete and the new company gets the revenue from ATRS , will the combined revenue from both companies have a significant impact on the price of the buyout company? Or is that years in the making? Thanks
I haven’t looked at that. I don’t know HALO at all.
Bought more NVTA @ $4.98
I also bought more at 4.98 ,hopefully sooner or later it will turn around
My breakeven now is only 17.50,still a long way to go
It feels like someone has it out for mm and this newsletter
He once worked as a short. I sometimes, when everything of ours hits the skids, wonder if some of his old pals subscribe for unfriendly purposes. Or can any once popular fund manager expect a negative wave, the way Cathie Wood has SARK?
Also looking to pick up some more. Love the potential from here.
NO, the potential is highly exaggerated. Genetic testing has little real-world impact on prevention and treatment strategies. Epigenetic factors (gene expression modification through proper lifestyle) are much more important. There is a small % of lung cancer genetic types where drugs can be tailored to the genetic mutation for better prognosis. For most lung cancer, there are no drugs targeted to other mutations, so the prognosis is terrible.
Beat you today. Bought 416 shares @$4.82 . Unbelievable
Cathie Wood has suicided another stock: TDOC. RIP.
NVTA does not go up until her forced liquidation. Hopefully that is soon. Same for VLD.
The new Radar Report for 4.28.22 is posted.