icon

With the "super committee" seemingly unable to come to a budget-cutting agreement this weekend, expect some volatility in the financial markets during the week ahead as the failure may trigger huge across-the-board cuts in government spending.

Regardless of the stalemate in Washington, here's some stocks and stories to watch for the week ahead...


HGSI: Shares of Human Genome Sciences (HGSI) have quickly retreated following a spike last month on buyout rumors that originated in England. A sub par earnings release started the retreat in price, but growing downward pressure saw the stock trading for eight dollars before closing last week at just over that mark.

Many expected more from the early stages of the Benlysta commercial launch, but although the drug - which is marketed by partner GlaxoSmithKline (GSK) - made history by becoming the first approved by the FDA to fight lupus in over half a century, the launch has not ramped up at the expected pace. As a result, the expected profitability of Human Genome has been pushed back a year, lending more support to the recent downward trend.

2012 could be a year of growth for the company, however, as Benlysta sales gain steam. Combine that forecast with the fact that there is always going to be buyout speculation on this company, and you've got a volatile play that can both pay quick dividends, but also realize sharp declines on a moment's notice; as evidenced by the past few weeks.

GERN: Just a few weeks ago Geron (GERN) was considered arguably the recognized leader in the field of embryonic stem cell research, having received the first green light to conduct a clinical trial utilizing that technology. Geron used its stem cell technology to devise a treatment for spinal cord industries (SCI) and the company's market cap approached a billion dollars at points over the past couple of years as investors bought into the stem cell hype.

In a news shocker last week, however, Geron announced that it would discontinue the further development of its stem cell programs, and instead look for a partner to move them along.

The news sent GERN shares dropping to $1.50, and in turn sent shares of InVivo (OTC BB: NVIV) towards the two dollar mark as Geron's stem cell based SCI treatment was no longer considered to be a near term competitor to NVIV's own developmental treatment for spinal cord injuries.

An investment in Geron is now, at least for the time being, an investment in its cancer pipeline. With last week's drop, it'll be one worth watching into the new trading week.

ACTC: Like InVivo, Advanced Cell Technology (OTC BB: ACTC) stands to benefit from Geron's departure from its stem cell programs. ACT late last year became the second company to receive an FDA go-ahead to conduct a clinical trial based on embryonic stem cell research and could now be considered a key leader in that field. With trials progressing testing ACT's RPE line on conditions of severe blindness, this company could start attracting additional press, and with it, new investor interest.

Stem cell technology may still be the next great advancement in medicine, making Advanced Cell one to keep an eye on. The recent announcement of a lawsuit sent shares temporarily below the ten cent mark, but closed last week up 8% and pushing twelve cents.

AMRN: Amarin is trading very significantly off its 52-week highs when news of positive trials for its treatment of high triglycerides and buyout talk sent shares soaring quickly towards twenty dollars. Some patent issues have weighed down on the stock, as well as indications from management that the company might not be actively searching for a partner as previously suspected.

A bottom may be close, however, and a rebound could be in store as many media outlets - including MSNBC's Jim Cramer - have started jumping back on board.

It's also likely that we haven't heard the last of the takeover rumors.

LPTN: Considering this small company's high-profile partnership with a major pharmaceutical player like Pfizer, it might be worth keeping an eye on the development of its ongoing Phase II trials. The technology that Pfizer is after is Lpath's ability - through its ImmuneY2 platform - to generate antibodies that target bioactive lipids and inhibit the growth and spreading of various diseases and inflammatory/auto-immune disorders.

Although this technology has been the target of increased research over the past few years, Lpath has thus far been the only to take it as far as it has.

Pfizer is already on board as a partner for iSONEP, which is being investigated as a potential treatment for retinal pigment epithelium detachment ("RPE detachment" or "PED") and Wet AMD, but the licensing agreement also grants Pfizer the first right of refusal for ASONEP, a potential cancer treatment.

The big boys don't make it a habit of jumping into a small company's pipeline before late stage results are known, so Pfizer's connection to Lpath certainly adds a level of validation that many small companies do not enjoy.

Keep an eye on this one, as the results of ongoing trials will be key.



ALSO WATCH:

FCEL: As another speculative green energy pick, FuelCell Energy (FCEL) tends to trade somewhat in line with Capstone Turbine (CPST) - and both often trade with the 'mood of the day' regarding alternative energy.

Capstone has rebounded from the dollar mark, however, since reporting another improving earnings quarter, while FuelCell continues to hover at below a buck. With orders for its technology still rolling in, and with green technology not ever going on the permanent backburner, keep an eye on FCEL.

SIRI: SiriusXM (SIRI) is starting to receive increased attention again. A Lazard analyst upgraded the stock to 'Buy', while a move by Liberty to eliminate its trading stock has fueled speculation that a buyout of SIRI may occur.

Shares moved higher Friday to $1.78, with another move towards two again a possibililty after a drop to under the $1.50 mark a couple of months ago.

The Lazard analyst slapped a price target of $2.25 on the SIRI stock, putting it on the hot list again.

BIEL: Volume of this highly speculative, sub-penny play has been up exponentially since the Dr. Oz show featured the ActiPatch last week. The ActiPatch is Bioelectronics' (BIEL) Pulsed Electromagnetic Field Therapy (PEMF) that treats swelling and pain in the feet, knee, wrist, and more. The company has focused on international growth while awaiting - and it's been a long wait - an FDA approval, but a lull in news has allowed this one to slip below the radar, and below a penny. The Doctor Oz publicity, however, might have inflicted some life into BIEL.

IMSC: Volume and price has been picking up for shares of Implant Sciences (IMSC) as the company's Quantum Sniffer explosive detection technology is increasingly deployed at airports and other locations around the globe in need of increased security. This month alone IMSC has announced an increased presence at airports in India and Uzbekestan, with sales also announced for nuclear power sites in Japan and Taiwan. A couple of major contracts in the United States could bring in the attention needed to put this company on the map for good. One to watch.

Happy trading.

Disclosure: Long CPST, BIEL, IMSC.

One Comment

  1. Gravatar
    Kevin Jan 22, 2012

    Hey VFC, thanks for doing your blog!

    At your recommendation, I started a Zecco account so that I could trade stocks that were $1.00 or less for $4.95 a trade. On August 19, 2011, I received an email from Zecco stating that trades under a dollar could cost as much as $700 a trade. I freaked out and refrained from making any trades. I recently contacted Zecco on January 18, 2012, and discovered that stocks that are non-DTC-eligible could cost $200-$700 or more to trade. At the time of my call, I only owned two stocks in my Zecco account. I discovered that BIEL is non-DTC-eligible and could cost me $200-$700 or more to sell or buy. My options if I want to avoid the $200-$700 or more in fees are to wait and see if they become DTC eligible or to transfer my shares to another brokerage firm. I was informed that at that moment CVM was DTC eligible and I could trade those shares but that I would be wise to contact Zecco before making that trade to see if they had become non-DTC-eligible because their list isn't always up-to-date in the moment. I think they update it at the end of each day but even that isn't guaranteed. As I understand it, their software prevents you from making trades once a stock is listed as non-DTC-eligible but between the time it is listed as non-DTC-eligible and the time that they make it so that you can't trade it, there is a window where you can trade it and still be charged $200-700 or more in fees. I suggested they develop some software that makes it impossible to trade a non-DTC-eligible stock the very moment it becomes non-DTC-eligible.

    What are your thoughts on this and have you switched to another brokerage firm? Do you know if BIEL plans to become DTC eligible? I'm planning to contact them right after this email to you.

Add a Comment