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    Pluristem Technologies wants to be your next Pharma stock

    Continuing my series of reader/subscriber suggested emails, I bring you Pluristem Technologies (PSTI). I’m not sure that the guy who emailed me this one doesn’t work for the company or the IR firm.  The email came right around the time that PSTI issued a flurry of press releases (Early July).  I deliberately waited over a month just to see “where the dust settled”.

    Well, the dust has settled and the stock is pushing off a key support level and might be ready to climb. The stock has been very volatile over the past three months.  The stock has see-sawed between $1.60 and $1.15 (A day-traders dream).  The stock is now trading near the bottom of that range

    Before we get to the chart, let’s talk about the company.  It is a typical Pharma play (no income, high cash burn and a marginal balance sheet).  The company has been winning the press release war though. They have had a number of positive press releases over the past few months that would one to believe that they are “heading in the right direction”.  The other thing to remember about PSTI is that they are in the Stem Cell sector.  Anything that excites that sector will lift PSTI stock.

    Here is a description of the company from Yahoo! Finance:

    “Pluristem Therapeutics, Inc., a bio-therapeutics company, engages in the production, research, and development of placental-derived adherent stromal cells (ASCs). The company also involves in the commercialization of non-personalized (allogeneic) cell therapy products for the treatment of various severe degenerative, ischemic, and autoimmune disorders. It develops a pipeline of products that are derived from the human placenta, a non-controversial, non-embryonic, adult stem cell source.”

    It appears from my due diligence that PSTI has a real chance to become a player in their chosen markets.  I downloaded and read a free research report from Griffin Securities (click on this link to access…you must sign up).  Griffin writes a very compelling case for PSTI.  Rarely is someone truly objective…..Griffin is doing PSTI’s investment banking, so read it with a small grain of salt.

    It is important to know several facts: PSTI uses stem cells from non-controversial sources (Placentas) and has a strong backer in the Israeli government.  Israel recently gave PSTI $2.3MM to fund operations.  According to Griffin’s report, this gives PSTI ability to fund operations into 2010 without any additional funding.  Live trials have started in at least two of the drugs in their portfolio.

    This might be the time to take a look at PSTI. The chart is not compelling right now, but it is nearing oversold conditions according to the Stochastics and RSI.  The angle and direction the MACD speak that it is bearish, but it is repeating a pattern from late June that saw the stock rise from $1.13 to $1.49 in three weeks.

    The challenge when you are looking at a stock like this is determining the tipping point.  i.e. When will the stock reverse its direction?  When will the oversold bounce occur?  Will it have legs to overcome resistance on the way to new highs?  I believe that this one should be on your radar screen.

    By the way, Griffin has a 12 month price target of $7.00 for the stock.  I know these targets mean little or nothing, but is is merely an indicator of their sentiment.

    DO NOT BASE ANY INVESTMENT DECISION UPON ANY MATERIALS FOUND ON THIS REPORT. We are not registered as a securities broker-dealer or an investment adviser either with the U.S. Securities and Exchange Commission (the “SEC”) or with any state securities regulatory authority. We are neither licensed nor qualified to provide investment advice. Neither nor its affiliates have a beneficial interest in the mentioned company; nor have they received compensation of any kind for any of the companies listed in this communication. The information contained in our report is not an offer to buy or sell securities. We distribute opinions, comments and information free of charge exclusively to individuals who wish to receive them.

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