A brief roundup of stocks making news this morning...
Capstone Turbine (Nasdaq: CPST) shares spiked by roughly nine percent on Friday after the company announced another very significant purchase for its low-emission microturbine units. This movst recent order included 25 C65 and two C1000 units - all destined for the Permian Basin shale play beneath West Texas and southeastern New Mexico - and follows suit of a strong showing for the company during the new year's opening weeks. The bang of big orders to open the new year is certainly bringing renewed attention to the Capstone Turbine stock, as volume rolled in at nearly three times the norm on Friday, but the company has yet to become a profitable one, which give the shorts an opportunity to jump on top of rallies such as this one. Should this bombardment of new orders continue into the new year, however, enough momentum may exist to sustain a prolonged period of highs. Given that shares are trading for well more than double their 52-week lows, it's safe to assume that profit-taking will set in at some point. I would still be skeptical about chasing this rally, but still a decent long term play on any pullback buys, in my opinion. It's become apparent that Capstone has found a niche customer base and the amount of re-orders received along the way is a good indication that those customers like what they see. Bear in mind that that the string of new orders we've seen this year will not be included in the next earnings release, which - if in line with the previous earnings report - may not look as enthusiastic as the current headlines on a quarter-over-quarter basis. The shorts will likely use any hint of weakness to push shares lower. That would provide an opportunity for the longs to buy the dip.
Shares of Agenus Inc (NASDAQ: AGEN) closed higher by three percent on Friday, capping off a decent week of green highlighted by some news updates regarding the clinical progress and plans for the pipeline. One update included the initiation of a Phase 2 trial with lead pipeline candidate Prophage "in the treatment of melanoma, and Bristol-Myers Squibb's Yervoy, for the treatment of Stage III and IV metastatic melanoma." The combination, according to a Tuesday morning release, has the potential to trigger a more effective immune response against the tumor than Yervoy alone. Agenus has proven to be a decent speculative trade in the past and news such as this fuels the speculative outlook for those betting on Prophage success.
The update was a fairly straightforward one, but TheStreet.com noted in its biotech blog that AGEN had used last week's press release to lead investors to believe that the company was conducting a trial in conjunction with a Bristol-Myers partnership. Not sure if that one was intended as comic relief by TheStreet's biotech blogging crew, but those guys are probably the only ones in the investing community who took that PR to read as a partnership. If it was humor intended by the biotech blog, is was a weak attempt.
We followed the swift price spike of CEL-SCI Corporation (NYSEMKT: CVM) shares last week as they jumped to highs of just about a dollar, after beginning the weak at roughly seventy cents. Volume was huge during the run, as outlined in our discussions last week. In a manner typical to previous CVM runs, the rally lasted about three days before tapering off to close down by five percent on Friday. If no relevant news hits the wires anytime soon to justify the rally, it should be assumed that shares will again sputter back to previously-traded levels. Any pullbacks on profit taking, however, could be a good time to add shares, for those looking to play the Multikine story. As discussed, Mulitikine is currently being investigated in a worldwide Phase III trial for the treatment of head and neck cancer. CVM's current market cap indicates a fair amount of investor skepticism, so any positive news release in relation to the trial progress could provide enough of a spark to drive the market cap to an area more in line with the speculative potential of Multikine. It's fairly routine to see developmental companies such as this one to hold specultive market caps of near the 100 million mark during the latter stages of Phase III, so CVM is always susceptable to speculative rallies, such as the one we saw last week - but it'll take real news to hold the gains posted on those rallies. If you don't see any Cel-Sci news today, expect a retracement in price to continue.