Small Cap Stock Market Investing Tips

Wednesday brought a whole lot of pain to the broad markets, and although there were a few hot runners out there like Ampio Pharmaceuticals (AMPE) and FuelCell Energy (FCEL), the color of blood dominated the big boards for the duration of the day thanks to continued worrisome news from Europe where Spain has replaced Greece as the target of negative financial press.

Unsurprisingly, Facebook (FB) continued its post-IPO decline and dropped another two percent on the day as shares tumble down to levels where many investors (aside from the insiders who made bank on the initial offering) would consider to be fair value.

Aside from the aforementioned stocks to watch and the falling knives that investors may be smart to stay away from, like Facebook and Research In Motion (RIMM), for example, there are some other potential opportunities in various sectors opening up with the recent decline that investors might want to jump on, or at least keep on the radar screen...

A late day price and volume spike placed shares of Ampio Pharmaceuticals (AMPE) ten percent higher than where they opened on Wednesday, a notable feat on a day dominated by bleeding red in the markets as the DOW, Nasdaq and S&P were all down by over a percentage point. No news accompanied AMPE's impressive trading action, but speculation would have it that something may be cooking in terms of pipeline news, given the already solid progress demonstrated by the company's pipeline over the past few quarters...

Shares of FuelCell Energy (FCEL) were on the move to open the new - albeit shortened - trading week, spiking by eight percent on Tuesday after the company received some positive coverage by a couple of popular financial media outlets which are predicting that profitability may be a possibility for the company over the short term.

Concerns of profitability have weighed down the FCEL share price each time the stock has ran on encouraging news.  Earlier this year news of a large cash infusion from a South Korean partner allowed FCEL to run towards the two dollar mark, but the push faded and shares subsequently dropped to well below the price of a recent stock offering...

Through recent acquisitions and the landing of numerous business contracts over the past few months, Premier Alliance Group (PIMO) is looking to make a significant move in the advisory and consulting arena.  

As such, Premier has secured the foundations of swift growth, having already signed deals with high-profile clients that include the US Department of Defense (DOD), multiple municipalities in Southern California, and, according to a recent company presentation, blue chips such as Exxon (XOM), Coca-Cola (KO), AIG (AIG) and Bank of America (BAC)...

At the conclusion of each week,VFC's Stock House examines some news items, stocks and stories that made headlines during the previous trading week, but may also make headlines or influence trends during the upcoming week as well. Although focusing intently on the biotech and healthcare sectors, due attention is also given to potential market-moving or game-changing companies in a broad variety of sectors and industries. The 'Weekly Stock Watch' will also introduce new companies for coverage and identify some stocks that may have entered 'buy territory'.

On this Memorial Day here's a shout out to the men and women of our military, who day in and day out go out and get the job done without the luxuries and lifestyles enjoyed by those back on the homeland. Let's not forget the sacrifices made, the time away from families, friends and loved ones, and let's not forget the ultimate sacrifices made by far too many. When all the BBQs, beers and pool parties are over, remember to honor the fallen, the ones that would fall, and the ones that have given it their all for a grateful - and sometimes ungrateful - nation. A particular shout out goes to the World War II generation, who have proven time and again that it may have been the best generation; when the world knew all too well what was at stake if the good guys lost.

Barely a week ago shares of Cytosorbents Corporation (CTSO) looked to be in the midst of collapse after an earnings report indicated that the company was still working at a methodical pace to advance CytoSorb onto the European market - a pace, as we've seen, that the more impatient investors do not feel is quick enough.

On the other hand, many believe that, for a company its size, Cytosorbents has made steady, if not remarkable progress in bringing attention to the company and its blood purification technology since receiving a European marketing approval just over a year ago. It's those investors that likely took advantage of last week's price drop that saw shares slip to seven cents again for a short period of time during intra-day trading on the 16th...

What should have turned into an historic day for the post-recession IPO market has turned into a calamity. Facebook (FB) is a business based on leaving its users "feeling good." Feeling good about interacting with family, friends and colleagues, and feeling good about finding products, services and stories that may interest them and therefore enabling the company to bank some advertising money.

It's a business model built on loyalty - where users of the website and service come back day after day, sometimes minute after minute - because it "feels good" to be a part of what's going on in the worlds of those listed in the 'friends' and 'family' sections of their Facebook page.

That all changed overnight...

Synergy Pharmaceuticals (SGYP) ran to over seven dollars last month on increasing volume as the company's billion dollar potential took shape and numerous analysts jumped on board with encouraging write-ups and bold price predictions.

Synergy also received a boost when its chief competitor, Ironwood Pharmaceuticals (IRWD) received a setback at the FDA that allows SGYP an extra three months to play catch up in the race to commercialization for each company's respective product candidate, both of which target the same indication. Synergy's product Plecanatide, however, has a much more favorable side effect profile, making the Ironwood setback that much more of a key factor when discussing future market potential...

After a five percent drop on Friday, shares of Ampio Pharmaceuticals (AMPE) started to rebound along with the broad markets on Monday, posting a three percent increase on the day. Ampio's drop over the past couple of months could be attributed to the dramatic increase in the number of shares short on a month-over-month basis, but as the market settles and Ampio continues to release encouraging pipeline results, then a quick rebound could take full effect.

Last year shares ran to nearly ten dollars as the potential of Ampio's "re-purposed" pipeline became attracted the attention to the investing community. The spark of new interest was so quick, however, that it also attracted the attention of the shorts, however, which led to a decline in price to the current trading levels...

Premier Alliance Group (PIMO) pushed the dollar mark late last year after a flurry of encouraging company events and news announcements circulated the wires, and another round of interest may be forming again after a Monday press release announced that the Orange County, California municipality had requested the services of Premier to assist in implementing Southern California Edison's (SCE) Automated Demand Response program (Auto-DR).

Premier - and its GreenHouse division - have become recognized experts in regards to the program's implementation and the company has already successfully assisted other municipalities in Southern California putting Auto-DR into effect...

Shares of NovaBay Pharmaceuticals (NBY) were cruising along for months in a price range pretty much centered at right around the $1.30 mark until a sudden slide took shape along as the general market started to experience an overall downturn. No news hit the streets to justify the share price drop and volume, while above the norm, did not indicate a mass exodus of any sort.

Once the short term dust settled, however, NovaBay shares were quick to regain the one dollar foothold when news hit the wires last week announcing that the company had enrolled its first patient in a Phase IIb study that will evaluate the Company's lead compound, NVC-422, in the treatment of adenoviral conjunctivitis, a highly contagious form of "pink eye."

At the conclusion of each week,VFC's Stock House examines some news items, stocks and stories that made headlines during the previous trading week, but may also make headlines or influence trends during the upcoming week as well. Although focusing intently on the biotech and healthcare sectors, due attention is also given to potential market-moving or game-changing companies in a broad variety of sectors and industries. The 'Weekly Stock Watch' will also introduce new companies for coverage and identify some stocks that may have entered 'buy territory'.

As expected, all eyes were on the historic Facebook (FB) IPO last week, although continued economic trouble in Europe probably deserved more attention and should prove to be a whole lot more relevant to the markets from here on out.

Although having only one full day of trading in the history books, Facebook is already starting to look like a dud to any investor not already on the inside leading into the IPO. Emotion and investing don't mix, and those that excitedly predicted swift increases in the FB share price when they flooded the Nasdaq market were thoroughly disappointed on Friday as the closing price was not even a percentage point higher than the open...

No doubt Friday's Facebook (FB) IPO marks an historical moment in the history of the tech and financial sectors, but that's all that this much-anticipated event might turn out to be - a moment in time that, at the end of the day, means little in the grand scheme of things, other than that a great campaign of hype can spark enough emotional momentum to create an insane amount of wealth for those involved in the hype campaign.

Remember when shares of Sirius (SIRI) ran to over nine bucks solely because Howard Stern agreed to join the company for half a billion dollars? That hype made a whole lot of investors rich - while the numbers were never there to support the price - but when reality came crashing down on those that believed the hype, the share price followed south...

Another stable earnings report may have once again positioned Celsius Holdings (CELH) as a solid growth play to consider as the company's calorie burning, pre-workout beverage gains traction in its niche market.

The reported sales of $2.5 million for the first quarter of 2012 were up from a number of $2.2 million during the same quarter last year, but more significantly was the increase of 41% over the fourth quarter of 2011. Returns and stockpile write-off has hampered the numbers at times during the past year, but the numbers announced last week may have provided a turning point that the company can use to build momentum...

An analyst upgrade last week and renewed investor interest in Keryx Biopharmaceuticals (KERX) had shares heavily on the move over the past week, a move initially sparked, in part, by positive Phase III data for Zerenex in Japan. The KERX run culminated in a renewed push through the two dollar mark before a mid-week stall left shares sitting just below that mark.

The disappointing announcement of a Perifisone Phase III failure in early April sent shares plummeting from near the five dollar mark to below $1.50 as the short term catalyst traders bailed out and created an air of panic around the potential of the Keryx story moving forward, but the upgrade last week by Ladenburg Thalmann to 'Buy' from 'Neutral' reinvigorated some new life into the KERX share price and allowed investors - who by now have well digested the Perifisone news - to take a fresh look at the potential of Zerenex...

At the conclusion of each week,VFC's Stock House examines some news items, stocks and stories that made headlines during the previous trading week, but may also make headlines or influence trends during the upcoming week as well. Although focusing intently on the biotech and healthcare sectors, due attention is also given to potential market-moving or game-changing companies in a broad variety of sectors and industries. The 'Weekly Stock Watch' will also introduce new companies for coverage and identify some stocks that may have entered 'buy territory'.

Huge trading losses at JP Morgan Chase (JPM) that sent company shares spiraling by 10% on Friday accentuated an already lackluster trading week in the broad markets and left the door wide open for another volatile week ahead. Combine that sentiment with growing uncertainty in Europe, where recent Greek and French elections have the potential to reshape the look of austerity and other measures undertaken by European governments in an attempt to maintain control over the Euro Zone's teetering economy, and investors may see even more of a reason to sell out and hold on the sidelines until some normalcy returns to the sinking global sentiment - a sentiment that has some predicting will bring parity between the euro and the dollar.

There could, however, be a savior in the works...

Some hot stocks and stories to watch mid-week...

Human Genome Sciences (HGSI):

Long on potential but short on results has been the name of the game for the lupus-treating drug Benlysta since its commercial launch last year, but an offer last month by Human Genome's partner GlaxoSmithKline (GSK) to purchase the company has not only reinvigorated investor interest in the company's pipeline, but it also sparked a quick rally in the HGSI share price that returned investors about a double overnight.

The swift rally placed HGSI right in line with the valuation of Glaxo's offer, which stood at $2.6 billion and a $13 share price...

On the heels of Dendreon's (DNDN) first quarter earnings announcement on Monday that was - for the most part - in line with expectations, DNDN shares spiraled downward throughout the trading day on Tuesday and closed twenty five percent lower than the previous day's closing price.  The quick drop returned shares right back to near the bottom of the stock's trading range over the past few quarters and dampered the expectations of investors looking for a revival of the 'Golden Age' of Dendreon that would ignite another price run and possibly challenge the $40 levels seen shortly after the FDA's approval of Provenge a couple of years back...

It has been a rough couple of days for the markets as huge uncertainty in Europe and a stalling US recovery send shockwaves through the investing world, but there are still a few companies out there making news that are worth keeping an eye on. The broad downturn could also open up some solid buying opportunities that have the potential to turn into quick rebound stories once the markets recover.

Here's a little bit of the good, the bad and the ugly from the week so far, and some possible good deals there for the grabbing...

Prolor Biotech (PBTH): Prolor Biotech (PBTH) opened the week as a stock on the move and continued that pattern on Tuesday with an early seven percent price rise on heavier-than-usual volume sparked by a Monday news report announcing positive top-line results from a Phase II four-month treatment extension study of hGH-CTP growth hormone deficient adults...

At the conclusion of each week, VFC's Stock House examines some news items, stocks and stories that made headlines during the previous trading week, but may also make headlines or influence trends during the upcoming week as well. Although focusing intently on the biotech and healthcare sectors, due attention is also given to potential market-moving or game-changing companies in a broad variety of sectors and industries. The 'Weekly Stock Watch' will also introduce new companies for coverage and identify some stocks that may have entered 'buy territory'.

European elections, the people's protests of Putin in Russia and Disney's (DIS) 'The Avengers' dominated headlines over the weekend.  As the Russian people displayed their dismay with the re-election of Vladimir Putin in Russia, France's Nicolas Sarkozy was the latest European politician to receive the boot from voters still feeling the pain of the global economic meltdown a few years ago - and incumbents in Greece didn't fare much better...

Synergy Pharmaceuticals (SGYP) has been a stock on the move over the past few weeks based on the the billion-dollar potential of its pipeline and increasing analyst coverage that has attracted a significant amount of new trading volume. Synergy's short and long term prospects have also been strengthened by a recent news development of a competitor setback that may help the company play catch up to the developmental edge held by rival Ironwood Pharmaceuticals (IRWD). Ironwood's competing product is slated to make it to market first, although Synergy's product has thus far not caused any side effects, while Ironwood's has...

Immunocellular Therapeutics (IMUC) has already posted some significant gains since the opening days of 2012 - easily blowing through the two dollar mark before hitting three for a time - and although the stock has held strong through recent bouts of broad market volatility, shares experienced a mild pullback over the past few trading sessions.  Any such moves in line with Monday's four percent dip, however, may be viewed as nothing more than a potential opportunity to accumulate as IMUC may posess enough early-year momentum to not only sustain the current higher prices, but also to propel shares higher as numerous still-pending developments play out...