Friday, April 24, 2009

Ford (F) Loses Less Money but Burns Through Serious Cash

It tells you something about the market that we are in when Ford Motor Company (F) reports losing $40 million per day between January and March and that is perceived as good news- good enough to propel the stock to over five dollars for the first time since last October.

In total, Ford reported losing $1.6 billion for Quarter 1, beating analyst estimates as the company's cost cutting measures have effectively reduced cash burn. According to the CEO, the company has enough cash on hand to survive the year without asking for federal help.

Ford is without a doubt the safest investment of the American 'Big Three', but I'm not as giddy about these 'earnings' results as everyone else seems to be.

While the Ford stock has more than doubled in just over a month, auto sales continue to plummet. Company bigwigs are optimistic about the prospect of future sales, but Ford still faces fierce competition from other automakers who have stolen market share over the past few years and it's still the worst auto sales market in nearly thee decades.

When F traded for under two bucks I was surely tempted to buy, and looking back maybe I should have for a quick double, but I certainly wouldn't feel safe buying in now with the stock trading at five dollars.

I may miss the boat on this one, but I don't see the stock holding these levels for too long and I wouldn't be surprised if it dropped back to three dollars, if not less.

Let's be realistic- the company is burning through cash in a ferocious effort to survive. Losing forty million dollars per day is no joke, no matter how much money you have in the bank.

On the bright side, the company is heading in the right direction- towards the break even mark- and of the big three, Ford is the best equipped to immediately compete in the smaller, fuel efficient vehicle market as well as maintaining pickup truck and SUV sales.

Also, re-worked UAW contracts give Ford a leg up on GM and Chrysler.

F is a decent bet to recover down the road, but in this market there are safer options.

It's been a nice run for shareholders of F, but if I had any of this stock, I'd be selling right now.

If auto sales pick up substantially, and it looks like a significant chunk of those sales are Ford vehicles, then maybe I'll buy in at that point.

However, that doesn't mean I'll get rid of my Ford truck any time soon.

Thursday, April 23, 2009

Stock Watch: Biodelivery Sciences (BDSI)

2009 Stock Picks Part III, BDSI

After watching shares of Dendreon (DNDN) soar to twenty dollars on news that Provenge met the necessary survival endpoints in the IMPACT trial, attention can now be drawn to Biodelivery Sciences (BDSI), a small pharmaceutical company with a novel drug delivery system called BEMA (BioErodibleMucoAdhesive).

The FDA is set to issue a decision on Biodelivery's New Drug Application for Onsolis by mid-year, and as 'Decision Day' has approached, the stock has methodically marched towards five dollars, closing the day today at $4.83 after trading for under two dollars only a few short months ago.

Onsolis utilizes Biodelivery's BEMA technology to treat pain in cancer patients.

BDSI has doubled in the past weeks giving the company a market cap of nearly 93 million. Should Onsolis receive approval, the stock could spike to ten dollars initially, but likely will settle in the seven to eight dollar range before moving upwards once again.

However, based on the following analysis taken from Biodelivery's website, the potential is there for much higher stock prices:

The global market for pain medication generates annual sales of over $30 billion. Datamonitor estimates the current market for the proposed use of Onsolis™ to be approximately $700 million. BDSI believes that Onsolis™ has the potential to capture a significant share of the U.S. market for this use, which is estimated to result in annual peak sales of approximately $250 million.

On the other hand, if Onsolis is not approved, see ya at a buck.

BDSI has been an undiscovered gem for the past few weeks, but if the company receives approval for Onsolis, it won't remain undiscovered for long.

I expect increased volatility in the stock as 'Decision Day' approaches and I will add on any significant dips, although I recently sold some shares that had doubled.

Other news that could effect the stock price:

Onsolis could receive approval in Europe and the company could release updates on their other products that are in earlier stages of development and testing.

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Friday, April 17, 2009

Another Nice Run-Up For SIRI

On a day when the market for the most part moved sideways, there were quite a few pleasant surprise moves which made for some nice gains.

Insmed moved to a buck twenty while SIRI took the next leg up and closed at fifty cents, making the stock a 10-bagger for those that bought at five cents when the company was on the cusp of bankruptcy.

Since that time, the big boys have methodically covered their short positions and stepped the stock back up to a more reasonable trading level- and it may not be too long before they run it up to a dollar.

Mel Karmazin, SiriusXM CEO, was given a bailout by Liberty Media ust in time to av bankruptcy and he now has room, and time, to maneuver around the large debt payments that the company will have coming due.

SiriusXM is still a growing brand and the potential is there for the company to rake in subscriber fees via other mediums, as evidenced by the recent iPhone application.

SIRI may drop again after some profit taking, but if the market continues it's rebound, SIRI could very well move back to over a dollar in quick time.

Those investors who had lost significant amounts of money as SIRI dropped from over three bucks to under ten cents last year were able to recoup their losses, and then some, with the recent run.

Nothing is stable in this market, but I see SIRI continuing it's climb towards one dollar. If nothing else, this stock is proof positive that you should not always run and SELL when everyone else is. For chump change saved by avoiding a night out on the town once in a while, any investor could jump on a couple of risk-reward stocks such as SIRI.

In this case, you would have enjoyed a ten bagger.

VFC Expects News to be Released Monday Regarding INSM

Shares of Insmed (INSM) have enjoyed a two day rally that brought the stock to an intra-day high of $1.20, after trading in the mid-ninety-cents level.

So far today, INSM is trading on double the average volume with a 10% increase in price, leading me to believe that news is pending. Since good news (I'm assuming news will be good with the current trading pattern, but assumptions are often wrong) usually does not come after market close on Fridays, I believe we'll see good news released on Monday morning.

Also, today's action from INSM reminds me of DNDN's trading action the day before the Provenge news broke.

Of course, my theory would insinuate that insiders have leaked news early, which never happens on Wall Street.

Insmed recently sold their follow-on-biologics platform for $130 million, so any news released now will most likely be related to IPLEX.

Positive results from IPLEX Phase II trials could spur a buy-in by Ipsen that would give Insmed another cash infusion. This is an option that is part of a patent-infringement deal agreed upon two years ago.

I'll be watching the wires on Monday morning for some Insmed news.

Thursday, April 16, 2009

The Run on Financials and Investing Opportunities in This Market

Bank after bank has beaten the street on earnings this week and CitiGroup (C) will report tomorrow morning before the opening bell.

If Citi also beats the street, the run on financials could continue into early next week before we see any sort of a pullback.

I took advantage of Citi's modest pullback yesterday to add some January 2011 and September 2009 Call options to accompany my supply of C shares that are up approximately 60% overall.

There are still a good number of Bears out there who insist that this is still a fool's rally, and there may be some truth to that, but the overall mood in the market right now is a positive one; a huge reversal from just months ago when our elected officials were out there telling us that the sky was falling- and people were listening.

The economy is by no means turned around, but the market may have been oversold with all the negative press. And that leads us to the banks that may have been extremely oversold because they are not reporting stellar earnings but investors are still buying.

So far this week, short investors have lost the battle and next week should be pretty exciting.

Regardless of the recent action, the financials are looking like a nice play for the long term investor. C, for instance, will not stay under ten forever and BAC has looked strong for awhile.

The small investor could still make out pretty good down the road by buying a nice financial ETF now, complemented by a few individual stocks. I jumped on XLF a couple of months ago and it's already paid off nicely.

The volatility is not over and who knows what will come of the 'stress tests' that were conducted on the banks, but a few years from now none of that will matter if th market recovers as expected.

Don't be scared away by another stock market downturn. The possibility is there that the market will retrace again, but that will just present another great buying opportunity! I've got some cash on hand to re-invest in case that happens.

Looking a couple of years down the road, there's still a lot of money to be made in today's market.

Of course, if you listened to Cramer, you would have sold everything for a loss and would still be 4 1/2 years away from getting back into the market.

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Dendreon and the Aftermath: Other Immunotherapy Stocks Jump As Most Analysts Were on the Wrong Side of History

As shares of Dendreon (DNDN) hover around 17 dollars in anticipation of the company's presentation of results on April 28th at the American Urological Association conference, the impact of Provenge's success are being felt around the market.

Geert Kersten, CEO of CEL-SCI Corp, released a letter to the company's shareholders regarding Provenge's impact on Multikine, Cel-Sci's investigational immunotherapy treatment for head and neck cancer.

In his letter, Kersten stated, in part:

The significance of Dendreon's success to CEL-SCI is great. For years most investors have shunned the cancer immunotherapy space because of the many failures of various companies involved in the space. While we at CEL-SCI have always tried to differentiate why our immunotherapy approach to treating cancer should be successful where other immunotherapy approaches have failed, the whole cancer immunotherapy space has been so tainted that it was almost impossible to be heard. The successful outcome of the Dendreon study gives the cancer immunotherapy field the needed validation to attract new money to the space. The success of Dendreon proves that it is possible to harness the human immune system against a patient's own cancer.

Shares of Cel-Sci (CVM) are back to trading at the 25-26 cents level, but on the day that Dendreon released their news, the stock jumped to 30 cents. A Phase III trial for Multikine is in the works and if successfull, CVM could jump to significantly higher levels and handsomely reward patient investors, as did DNDN. That's a long way off, but you can't argue with the risk-reward while the stock is trading for a quarter.

AGEN and ONTY also spiked on the Provenge news.

Antigenics (AGEN) had their kidney cancer immunotherapy treatment, Oncophage, approved in Russia last year and Oncothyreon (ONTY) is currently testing Stimuvax, a small-cell lung cancer immunotherapy, in Phase III trials.

Also receiving a price spike was Cell Genesys (CEGE). CEGE is now trading near forty cents, but their prostate cancer immunotherapy GVAX had their trials halted because of an increased death rate among patients in a specific arm of the trial.

As for all the analysts who were on the wrong side of DNDN history, some are coming out and now changing their tune (too late for any investor that may have listened to their dribble).

Jonathan Aschoff at Brean Murray gave DNDN an upgrade to 'HOLD' from 'SELL' but did not issue a new price target (his previous target was $1).

You can never count on an analyst to be looking out for the little guy; they've got their own egos and hedge fund buddies to look after first, and the DNDN story is another example of how they let the little guy miss a big chance to gain some much needed cash in a down market.

Provenge still has a ways to go -Approval- but if the IMPACT results are as solid as the company CEO says they are, DNDN could be in for another significant run.

Wednesday, April 15, 2009

Good News and Bad News for Celsius (CSUH.OB) at GNC

The management team at Celsius Holdings (CSUH.OB) recently got their calorie burning Celsius drink on the shelves of GNC stores nationwide; a huge credibility victory fo the company, in my opinion.

After months of waiting, Celsius finally arrived at the local GNC in my area- that's the good news.

The bad news is that the saleswoman on staff when I entered the store dismissed Celsius after I asked her about the product and she pushed me towards the various Hydroxy products. No doubt that she was just attempting to boost the store's bottom lines by pumping the more expensive product, but she also had no knowledge of th product nor interest in selling it.

Instances like this could definitely hurt Celsius sales and hopefully customer service like I received is not widespread among the GNC community.

On the other hand, I've never been in a Vitamin Shoppe where the sales staff wasn't recommending Celsius to their customers.

After a recent double and a half, CSUH.OB has stabilized right around thirteen cents and is still trading on high volume.

If Quarter One numbers look good, we may see another double in stock price in short time.

Originally, my investment in CSUH.OB came with a five year sell plan, but after accumulating enough shares at or below five cents, I may take some off the table on the way up to fifty cents, a level that I believe the stock will reach before years end.

My confidence in the stock comes from the influence that Carl DeSantis now has on the company. While DeSantis is provided much needed capital to keep the company afloat, it is his contacts in the health and supplement industry that will end up proving more beneficial to making Celsius a household name.

Quarter One will be the first full quarter of targeted TV and radio ads and investors could be in for a pleasant surprise.

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Tuesday, April 14, 2009

Dendreon's Provenge Passes the Test

Just over two years ago the Dendreon (DNDN) stock soared to the mid twenties after an FDA advisory panel voted 17-0 that Provenge, Dendreon's prostate cancer immunotherapy, was safe and 13-4 that it was effective.

The rise in the stock price resulted in anticipation of the FDA approval that never came.

The FDA issued an approvable letter for Provenge, declaring that they needed more proof that Provenge worked.

That proof came today.

Dendreon reported that the Phase III IMPACT trial met it's primary endpoints of survival and that more information would be forthcoming at the American Urological Association's conference at the end of the month.

The DNDN stock closed at $16.99 today, up over 132% from yesterday's close, after reaching an intra-day high of $22.10.

Provenge still needs to clear the hurdle of commercial approval, but if the FDA maintains their previous stance, these trial results should be enough to garner that approval.

Today's trading rewarded patient investors, especially those that sold into the early morning spike, but more importantly, this is one step closer to rewarding the tens of thousands of cancer patients who have lobbied to have Provenge approved. These patients now have hope that didn't have yesterday; and if approved, Provenge will offer an alternative over Taxotere, the only current treatment for advanced prostate cancer that is accompanied by vicious side effects.

The general market was down today, but cancer immunotherapy stocks rallied.

The Provenge story is by no means over, but today's highly anticipated news may be enough to make Dendreon's prostate cancer treatment the first American approved cancer immunotherapy treatment.

Antigenic's (AGEN) Oncophage was approved last year in Russia. AGEN nearly doubled today on the Provenge news.

I sold 50% of my position today durin the early trading spike I'll wait and see how it plays out over the next few weeks. Shorts took over for the afternoon trading, but I expect another run before the upcoming AUA conference.

Congratulations to all the prostate cancer patients who had so much hope relying on this study and congratulations to the patient investors who have supported Dendreon for years.

Thursday, April 9, 2009

Nordstrom's Rally (JWN)

Retail stocks had a great run today as sales numbers for March indicated that the worst may be over for the major retail chains.

Year over year numbers were still down, but not down as much as many in the market suspected. In VFC's opinion, that means that the consumer is out there taking advantage of the many bargains that the bad economy has created.

Sales at the luxury retailer Nordstrom (JWN) were down 13% in March, in comparison to March of the previous year, a time when the true depth of the recession still had not hit.

On news of the 'modest' decline in sales, JWN jumped nearly three bucks today to a high of over $21.50, just two months after the stock was trading at near ten dollars.

I took advantage of this spike and sold today at $21.59 for a nice profit, as I don't expect the rally to continue. I may be wrong, but a retracement is likely after a run like Nordstrom's stock has enjoyed in such a short time.

My limit order of $21.50 sold for $21.59; Doesn't happen too often that my sales go for above the limit, but ...nice.

Once (if) JWN retreats back into the mid-teens, as I suspect it will, it'll be time to buy back in. For the time being, I don't see the retailers having enough legs in the short term to justify buying JWN over twenty dollars.

Enjoy this run in the retailers, but I suggest banking some profits while you can.

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Wednesday, April 8, 2009

Two Rising Pink Sheet Stocks With Potential

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The Rise of Oncothyreon (ONTY)

Amid the recent economic turmoil, marked by volatile highs and lows in the global stock markets, a little-known, clinical-stage biopharmaceutical company called Oncothyreon has risen from a trading level below the one dollar mark to a recent high of nearly three dollars with no significant news being released in the meatime.

Although I was unable to add to my position of ONTY at below a dollar because my broker did not trade that stock, I've had Oncothyreon on my radar for years; from the time the company traded under the symbol BIOM. Currently, I own a very small amount of shares that I have left over from the company's reverse stock split.

I think ONTY's stealth rise is worth noting.

On 18 March, 2009, Rodman & Renshaw initiated coverage of ONTY with a rating of 'Market Outperform' and the company has also received some royalty payments from Merck KGaA, for milestones reached regarding Oncothyreon's Phase III lung cancer vaccine, Stimuvax.

The recent rise in price could be due to increased investor awareness after R&R initiated coverage or it may have to do with anticipation of the ongoing Phase III trial which will measure the efficacy of Stimuvax.

Should Stimuvax make it to market, Oncothyreon would be due an agreed-upon royalty rate from Merck, who retains world-wide marketing and distribution rights for the vaccine.

Another possibility is that the company may have become a complete takeover target for Merck. At these low stock prices it may be more beneficial for the deep-pocketed Merck to buy-out Oncothyreon to alleviate future royalty payments, since Merck is already footing much of the financial bill in bringing Stimuvax to market.

Any talk of a takeover, however, is based purely on my own speculation.

With Big Pharma on the hunt for small biotechs with deep pipelines (as indicated by Merck & Co.'s purchase of Insmed's FOB pipeline), Oncothyreon could be a prime buy-out candidate as the company has three additional cancer-fighting drugs in the pipeline aside from Stimuvax- PX-12 to treat Pancreatic Cancer, and PX-478 and PX-866 to treat Multiple Solid Tumors.

ONTY's slow, but methodical rise in price with no significant news being released has peaked my interest.

Whether it's an idication of positive Phase III trial results for Stimuvax, a potential buy-out or just increased investor awareness, ONTY could prove to be one of the better investments for 2009.

On the other hand, the rise in price could just be a head-fake and a sharp decline may follow.

For now, I'm holding my position (all-be-it a small one), but I'll have my eye on ONTY.

If Stimuvax does make it to market, it could be a potential blockbuster, as the world's first approved lung cancer vaccine, in treating Non-Small Cell Lung Cancer.

If ONTY approaches the five dollar mark anytime soon, it's safe to assume that she won't be flying under the radar any longer.


Tuesday, April 7, 2009

Why the Recent Rise in Dendreon (DNDN)?

Shares of Dendreon soared this week to a high of over seven bucks as news became public last Friday that the American Urological Association has reserved time for the company to present data from their late stage Provenge trials at the annual meeting on April 28 in Chicago.

The fact that the company has reserved this time, while it could be construed as a bullish sign, would not be enough to cause such a significant increase in price.

However, the DNDN investing world, expecting Phase III (IMPACT) Provenge results to be released sometime in April, is on edge right now and any indications of an upcoming Press Release by the company will cause significant volatility.

The Press Release itself, vice the information contained within, most likely caused the price spike and subsequent volatility.

Once the investing community digested the information the stock slowly retreated back to the low six dollar level.

Investors (long and short) all remember the quick rise to over twenty dollars two years ago, and the trading days between now and trial results should be exciting, while gut-wrenching.

For those that have not sold into the most recent spike and have the stomach to stick it out could be well rewarded.

Positive results could launch DNDN to twenty dollars again, but if the results are negative, the stock may drop to a dollar.

Of course, the FDA has the final decision regarding approval.

Earnings Season; Expect Another Market Dip, But Are We On The Rebound?

The most recent stock market run has led us right into the season for first quarter, 2009 economic results.

While the Bear Market Rally has been enjoyable and everyone has had a chance to see their portfolios grow (especially those that bought at or around the low), the market is most likely due for a retracement due to profit taking and dismal 1Q results that will bring a taste of reality to the current stock market run.

However, there are indications that the market, and the economy as whole, may have hit bottom, giving way to thoughts that we are now entering the beginning phases of an economic recovery.

- Housing numbers have improved for both February and March. Housing Starts, an indicator of new building permits and future residential construction, were up by 22%in February.

- Existing home sales were up by a national average of 5%.

- Consumer spending is up.

- Retail sales are up.

While the numbers are still not where they need to be to support a vibrant, growing economy, indications are that consumers are spending and taking advantage of the deals that are out there.

The unemployment numbers are still atrocious but, in today's age of Quarterly Reports, publicly traded companies feel increasing pressure to immediately cut costs by eliminating jobs to boost the bottom line of the company in time for the next quarterly report.

These companies have stock and bond holders to satisfy, and in many cases that comes before taking care of the employee.

However, many of the workers that were let go during the economic slide will be re-hired at the first signs of recovery.

In fact, some used car dealerships in VFC's local area are already started re-hiring help that was let go just a few months ago because used car sales have been picking up significantly.

Local Real Estate agents have also indicated that sales are increasing.

For those that can afford to, now is the time to take advantage of the consumer market- the stock market, real estate market, auto market, and anything else out there that is on sale.

As most economists are saying, this is the best time to be a consumer in the last fifty years.

The Donald (Trump) adds that this is the time that the average American can amass wealth.

Times are tough and another economic dip may arrive before any recovery, but just as quick as the market crashed- it can rebound.

With trillions of dollars still sitting on the sidelines, indications are that the rebound may be closer than most expected just a few months ago when the stock market hovered in the mid 6,000s and it seemed like everyone was losing their job.

I expect that the current earnings season will will bring a few surprises, and I'll most certainly be adding on any market dips.

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