MicroStockProfit » Pharma

Could SNSS be the next hot pharma company?

Editor — Thu, 15 Apr 2010 12:58:33 +0000

I am not a pharma expert, but I do dabble in it. I probably should become one. Pharma stocks seem to dominate the boards at times. I think the company, Sunesis Pharmaceuticals, Inc. (NASDAQ:SNSS) should be on your pharma radar. It is a penny stock now, but they have grand plans.

Let’s talk about the bad stuff first:

** SNSS has received a delisting notice from Nasdaq for not maintaining the magic $1 trading level.
** They recently issued their latest Q and it shows that they spend money like drunken sailors. Net loss was $4.0 million for the fourth quarter of 2009 and $40.2 million year ended December 31, 2009. Nearly $20 million of that loss was non-cash, but SNSS still burns cash like crazy.
** The company needs money to survive. With only $4 million in the bank, they need to raise capital…..which could be dilutive and devaluing.

Now, let’s talk about the good stuff:

** SNSS, which focuses on treatment of solid and hematological cancers, has a very promising drug candidate in the treatment of AML, a virulent and vicious form of leukemia. I have read where that market alone is almost a billion dollars annually. SNSS, which would have no direct competition in that niche, is proceeding on an FDA approval. So far, I have seen no hiccups on their march towards approval. That drug alone could push SNSS, on a valuation basis, to over 5. Pure hype and excitement from any news related FDA approval news could push the stock to a double or a triple in the matter of days.
** Clean balance sheet – Even though it is not strong, SNSS has no debt and has a “clean” BS.
** Volatility – This can be a good stock to trade. It has had some high volatility historically. With the need to keep their Nasdaq listing intact, expect them to pull “a few rabbits out of their hats” which could drive the stock up. With some news, they could be one of the penny stock darlings on the boards again.

I think that SNSS has some real home-run potential. They have a few problems at present, but management seems to be able to effectively navigate the shoals in the pharma world.

Here is their chart (with my annotations) so you can see that the chart is also favorable:

I think that SNSS should be on your trading radar. The progress the company has made on its blockbuster AML drug will make raising capital easy imo. I am not on the inside and am speculating, but I think that SNSS has a bright future. It won’t be a penny stock a year from now.

Have a great trading day!

Jeffrey Dean, Editor

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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 MicroStockProfit.com 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.

When will Generex Biotechnology (GNBT) stop falling?

Editor — Wed, 14 Apr 2010 13:32:25 +0000

GNBT has been around forever in the pennystock world. It has been touted as the next Nasdaq stock (or a piece of crap that is going to zero) in the time that I have been watching it.

It definitely isn’t going to zero, but right now traders and investors are down on GNBT…..for good reason.

Generex Biotechnology Corporation (GNBT) is a biotechnology company that is working on variations of its drug delivery systems for diabetes (and other illnesses). Here is a link to their site if you want to do more DD.

GNBT has been trading in a range between $0.40 and $0.70 for the last 6 months. Right now, it is trading at the bottom of that range.

I am not recommending that anyone “catch the falling knife” on this one, but I am thinking that GNBT is prime for a reversal. For all of the negative press that GNBT has been receiving, the news that they have received a financing commitment is a positive indicator. True, the financing is at a discount to GNBT’s current trading price. But, the commitment is real and they have already drawn the first tranche. It is composed of 24 tranches. The financing guys are not stupid. They want to be able to limit their exposure if things get worse for the company.

The negative press stems from the ever-irascible Adam Feuerstein of TheStreet.com, who called out GNBT and labeled them frauds. The company responded with a $250 Million defamation suit. I like MIchael Fizhugh’s article on SeekingAlpha.com about the whole mess. Read it here.

The Chart

Clearly, GNBT is in a downtrend. But, there is hope for a recovery. In the last 5 trading days, there has been 3 high volume selling days BUT there have been two up days. All the news is not bad. It looks like buyers are trying to bid up the stock. The oversold stochastics will exert some pressure for a bounce, but with the MACD still bearish, the stock could continue to fall for a while yet.

Watch for the MACD histogram to indicate that the bearish trend intensity is lessening. Another indicator that I am using lately is On Balance Volume (OBV). That indicator is telling me that the stock is still in distribution.

I am not qualified to pass judgment of GNBT’s drug portfolio. I look at anecdotal information to give me some idea of whether this stock has a chance. The financing is a huge indicator to me that GNBT will be around a bit longer. The company has plenty of cash, low debt, great ratios….that will help them see this “crisis” through. Any good FDA news and this stock will fly….Bad and the reverse will happen.

GNBT’s volatility is a great thing for short-term traders like us.

Trade with confidence,

Jeffrey Dean, Editor

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Hard to get a read on HTDS

Editor — Tue, 25 Aug 2009 06:11:58 +0000

Hard To Treat Diseases, Inc. is a hard company to get a read on…as my title indicates. It is in the Pharma business, but not really much of a player. They have operations in Serbia and China under two separate operating divisions and appear to have a “story to tell”. .

In China they operate through Shenzhen Mellow Hope Pharm Industrial Co Ltd.. According to the company, Mellow Hope is the biggest exporter of Biological Vaccines in China. HTDS purchased Mellow Hope in February of this year in an all-stock transaction. It appears that the company has a viable product line and an active global client base. Here is a link to the Mellow Hope web site that makes for interesting reading.

In Serbia, they have a controlling interest in a company called Slavica Bio Chem Company. Their primary focus involves the enhancement and modification of existing approved drugs such as “Virazole” for the purpose of chemical repair of damage to the CNS (central nervous system), MS (Multiple Sclerosis), SARS, Hepatitis C and HIV. Here is the link to Slavica’s web site.

HTDS has garnered a huge amount of attention on the boards and as a stock to trade. Here is the chart:

The chart is not really compelling and tends to indicate that the stock is “taking a breather”. The MACD, while above the zero line, is indicating bearishness. The stock is under distribution and is being sold (profits takers, anyone?). Volume has dropped off lately and indicates that the stock is out of favor right now. Let’s put my last statement in perspective, though. The stock still traded 196 Million shares yesterday, off significantly from its 3-month average. What is amazing is that the trading activity of this magnitude is occurring with only 1,072,581,000 in the float (as of Mar 30, 2009). The thing to keep in mind is that this is a penny stock play and subject to all the manipulation and pumping of any penny.

What I find compelling is that HTDS has done some very astute things (acquisition of Mellow Hope) and appears to be very cost efficient in searching for new products. I will be very interested to see what kind of numbers Mellow Hope can produce for the company going forward. The Serbian operation holds out great hope for the company, too. It is working on modifications to a number of existing drugs to treat some of the more “popular” diseases of today’s society. Working with existing drugs also means that the dreaded FDA turndown is less likely and drugs can be brought to market quicker.

I could see this company retesting its recent highs of last week (21.9 cents) and pushing into new territory. Their is no resistance above 21.9 cents and limited resistance between 11 cents and 21.9 cents. The stock rebounded 29.41% today and may retract a little today, but I think the direction for the stock is up. Look for the right entry point and make sure you have a tight stop on it.

I believe that HTDS has the right formula for traders and investors.

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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 InvestorSoup.com 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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