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Tuesday, September 29, 2009

Readers Respond: NEOL

In response to a number of requests that I've received via email or comments asking for 'VFC's Take' on numerous stocks that readers have found, I'll do my best to address as many as I can, as long as everyone takes a few things into account while reading:

- I have not thoroughly researched all of the stocks that I'm about to comment on. I've done the initial DD but my opinions are mostly based on my first impressions of the stock. I'm merely providing VFC's Take, as requested. Use that as a starting point to do your own DD.

- Don't get testy if I don't like your stock. Remember, this is just my initial impression and I take into consideration some variables that other people don't, that's why VFC's Take is not always the mainstream impression.

- I appreciate all the recent feedback, and keep the stock tips coming; this is a great forum for all investors of all levels to share tips and insights. There's a whole lot of stocks out there, but there's only a few gems. Let's keep trying to find those gems.

optionsXpress

A comment from Alejandro:

Hi VFC.
I had to read more than twice the post about patience before take a look at my position in BDSI, I´m in a nearly average of $5.2. Thanks for your comments about that share, that help me to be more confident with my decision to hold.
On the other hand, today I have experienced an increase of 70% in the price of NEOL (I bought Neol time ago when asked you about your smell test), My NEWBIE QUESTION here is, none evident information has changed the price, because the last good news to me is they are expanding, but that was a week ago, what does it means? Insider information? what should I do, because I don't feel that I can support the price to see where is going. Should I sell a bunch o shares to try buy them later at a lower price? because I dont understand where is the speculative move when no apparent information is involved, may be I´m missing something, what could It be?...
Thank you very much for all your advices.


VFC's Take: Regarding your decision to hold BDSI - I think it's a good one. The stock has too much potential to be held down for long and Monday's move proved just how quick a stock can move when it's ready to move. I still like BDSI for a long term hold.

Regarding NEOL, I'm pretty sure that adding Tuesday's gains to your 70% increase has you sitting at pretty close to a double in the stock. I think that you assessed the situation pretty accurately - the gains are nice, but it is a speculative stock.

It's hard to offer up a firm opinion without having a clearer picture of how many shares of NEOL you have or what the overall condition of your portfolio is, but the best thing to do is to consider the following two scenarios and then decide which one - to you - is worse; I say "to you" because everyone has their own comfort zone:

- the stock drops and you did not sell any shares to realize a profit.

- you sell a few shares in order to realize some profit, but the stock continues to rise.

In my opinion, it's worse to watch a stock drop when you had the opportunity to sell a few shares than it is to watch a stock climb - even after you sold a few shares. Especially in the arena of speculative biotech.

A double is a huge gain. Granted, many big time speculative investors will laugh at a double and hold for future gains, but the small investor can't take the chance that the future gains won't be realized, so selling into a double is a way to stay ahead of the game. If the stock then drops, you can buy back in and if it continues, you still have shares that will increase in value - to me, it's a win-win situation.

I say great trade, Alejandro. Rely on your own DD and comfort zone (and entry/exit strategies) and do what you believe is best for you - but don't forget that a gain is not a gain until it is realized. Also consider your entry/exit strategy; if you bought the stock as a long term hold, then I could also understand holding until some of the pipeline candidates play out. The market cap is still relatively small (about 14 million) and additional speculative trading could easily run this stock to a dollar before any product updates are released.

There's a lot to consider, but in the end ya gotta do what's best for you!

Disclosure: No position.

The Rise of MedaSorb Technologies (MSBT)

MSBT.ob: Shares of Medasorb Technologies soared early on Tuesday to a high of nearly twenty cents on huge volume while no news that could possibly explain the rise was released.

As I mentioned about a week ago, I do expect this stock to reach the fifty cent to a dollar range by the end of the first half of 2010 - about the time that the European CytoSorb results are due to be finalized - but it is possible that, based on the recent rise in both price and volume significant news could be released sooner than that.

It's also possible that the recent rise in price has little to do with news and more to do with speculation or manipulation; for that reason I decided to sell a handful of shares - enough to now have only 'house money' on the stock - into Tuesday's spike and I will let the rest of the shares ride as we await the outcome of the CytoSorb trial.

As a speculative play, it's hard to recommend a buy for MSBT.ob right now based on the fact that the stock has more than tripled in short time on no news, but if it drops back to the twelve cent range for the short term, I'd say start accumulating a few shares.

Keep in mind, however, that CytoSorb will make or break this company - there's no number two option to fall back on if it is proven that this medical device, which treats Sepsis, doesn't work. For that reason, I suggest playing the spikes and dips in order to be fully on house money by the time results come out.

As for the current spike in price - it sure adds to a green portfolio!

Disclosure: VFC is long MSBT.ob.

8x8, Inc.

Briefs: BDSI, BIEL

BDSI: Shares of BioDelivery Sciences put a halt to the stock's current downtrend on Monday, closing at $4.79 after closing last week at $4.24. Early trading on Tuesday saw the stock trading relatively flat, aside from an early morning when BDSI spiked to nearly five dollars.

Monday's spike, in my opinion, could have been due to anticipation by investors of possible significant news (partnership) being released on Tuesday morning, just before Dr. Mark A. Sirgo was scheduled to present at the 2009 Maxim Group Growth Conference.

Since no news was announced on Tuesday morning, BDSI continued to trade for under five dollars - a price that I believe is a great buy for this stock because of reasons that I've outlined HERE.

If you're still under water with BDSI, continue to average down; that doesn't always mean waiting on the sidelines to see how low it will go - because Monday showed us that a reversal could come quick - but buy in increments for below the price at which you may be averaged in and watch as your cost average drop.

The way I play it when I'm trying to average down is I'll buy more and more shares as the price drops. That will quickly lower your cost average, but you must be very confident in your DD to stomach that strategy sometimes. For instance, it took quite a few Rolaids to soothe my stomach while buying CSUH for under five cents, but I was confident in my DD that told me that that company was on to a new genre being created in our country.

That one paid off and I believe that BDSI will also.

Disclosure: VFC is long BDSI.

Free Fast

BIEL.pk: Shares of BioElectronics Corp could be finished trading for under ten cents as a mid day PR announced that the company's stock symbol, BIEL, will have the "Caveat Emptor" removed from its symbol and will be replaced with "Limited Information."

It is expected that in short time the stock symbol will trade as "Fully Reporting."

There can be no doubt that many potential investors would have been scared away from the "CE" status of the BIEL stock, but today's news should soothe the minds of weary investors and allow them to invest based on the potential of the company's products - ActiPatch and ReveryRX.

As consumers look for alternatives to OTC drugs such as Tylenol and Ibuprofen because of health concerns, a shift towards products such as BIEL's bodes well for the future of this company.

ActiPatch and RecoveryRX are both small, drug-free anti-inflammatory devices that use small electrical pulses to reduce pain and swelling in patients.

I still like BIEL as a buy for right around ten cents, but time could be limited to accumulate shares for that cheap. Tuesday's announcement was big news for the BIEL stock, which could now start trading up towards its potential. For the time being - until we hear from the FDA - I consider BIEL a twenty cent stock.

Once the FDA approves the products for additional indications and we start seeing the sales results, a bigger move up could be in store.

Disclosure: VFC is long BIEL.

Get the full picture with the Trade and Probability Calculator.

Briefs: TTNP, VNDA, KERX

MOVED TO:  http://vfcsstockhouse.com/blog/article/-briefs-ttnp-vnda-kerx

Sunday, September 27, 2009

Celsius (CSUH) Signs With CROSSMARK

On September 16th, Celsius Holdings announced a sales and marketing agreement with CROSSMARK, "the Leading Provider of Go-to-Market Services to Consumer Goods Retailers and Manufacturers," according to a press release issued by the company.

CROSSMARK already serves some big time clients - Frito Lay, Johnson & Johnson and Nestle, just to name a few - and this agreement is just more proof that the Celsius product is making a quick move to the 'Big Leagues.' With a national awareness campaign already in effect in the form of print, television and radio ads, the deal with CROSSMARK is indicative of a huge distribution push, in my opinion.

The company's stock has been stuck in a trading range of between forty and fifty cents for some time now, although that could change as investors speculate on what the third quarter numbers will look like after the advertising campaign kicked off.

For those that are just now looking to get in the stock, I like the low forty cent range as an entry point - but obviously buy on any dips. While I do see some short term potential with the stock - as I believe sales numbers are going to be significantly higher now that the advertising campaign is gaining steam - I like CSUH as a long term hold.

We're still in on the ground floor of a growing company, in my opinion, but a phase of strong growth has commenced and if sales numbers start taking off, then the stock price could quickly trade to the upside - as we saw in the CSUH run earlier this year.

Also of note, the Raspberry Acai Green Tea flavor of the product was the winner of the 2009 CSP Retailer Best New Product Awards for the functional drink category. For those that may not know, Celsius is the world's first calorie burning beverage and the company has data from four clinical studies to back up those claims.

As America looks for new ways to re-invigorate health and fitness into the every day lives of its citizens, Celsius is primed to play a key role in the renewed move towards fitness; and that could bode well for both those looking to improve their own fitness and also for shareholders of the company.

Disclosure: VFC is long CSUH.

Saturday, September 26, 2009

Briefs: AGEN & ONTY

I've received quite a bit of feedback lately asking for an updated "VFC's Take" regarding some stocks that have either traded down of late or are still stagnant. I'll do my best to address my current opinions and trading strategies for a few of them.

Follow the money with Trading Patterns.

AGEN: Nothing has changed with the potential of Antigenics and its stock. If anything, the longer it trades for a price of near two dollars, the better buy it becomes because the closer news is to being released.

Investors have heard nothing that would lead us to believe that the fourth quarter Oncophage launch in Russia is not moving along as planned, it's still only a final decision on the Russian Government reimbursement that we're waiting on.

Additionally, news from Europe could come at any time regarding an EMEA opinion on Oncophage and should that decision indicate possible approval (either conditional or outright), then the AGEN stock should begin to soar.

Positive news is still flowing regarding QS-21 and after looking at the whole picture, it's still hard to find a reason not to like the risk/reward profile of this stock even after it has become a six-bagger since May.

Since I'm satisfied with my position of this stock, my buy price is two dollars; that's the price level at which I cannot resist adding more shares (give or take a few pennies). That being said, with all the short interest currently on AGEN right now, I wouldn't be surprised to see one more dip below that level, at which point I would significantly pick up my pace of buying.

I've mentioned before that AGEN is one of the few stocks that I am willing to average-up in and I will continue to do so as long as the price is right. In my opinion, the next big move will push the stock to over five dollars, but eventually I consider this one to be another DNDN.

Stock investing takes a lot of patience, and I do believe that patience will pay off with AGEN. There's no reason to worry now, in my opinion, it's time to take advantage of the manipulation and BUY.

Disclosure: VFC is long AGEN.



ONTY: My opinion of Oncothyreon and its stock is pretty much the same as it is for AGEN - nothing has changed and there's no reason to panic or sell. My 'can't resist' price for AGEN is $2, as I mentioned above, and that price is $5 for ONTY. Again, I'm averaging up with ONTY but I also consider this stock one that could become the next Dendreon (DNDN).

It's important to remember that these stocks are already up significantly this year and it takes time for consolidation to take place before news can propel them to the next level.

In my opinion, the lull periods between big moves is a great time to buy - not a great time to complain about inaction - and ONTY is no exception. If Stimuvax continues to live up to its potential, then we'll have a real winner of a stock with ONTY - it's that simple.

Disclosure: VFC is long ONTY.

Doubleday Book Club (Direct Agents)- cdb_1008_300x250

Taking Advantage of the BioDelivery (BDSI) Dip

Shares of BioDelivery Sciences ended the trading week last week at $4.24, a nearly 50% price cut from the stock's 52-week high of over eight dollars. I know that many investors start feeling the panic set in when a stock that they thought was a winner, such as BDSI, starts to drop for no apparent reason. Many of those investors will then sell their shares as a result of that feeling of panic which, in my opinion, would be an example of selling on emotion - a trading practice of which I'm not a big fan.

I believe that BDSI is a stock that is being manipulated right now - I would call it 'the big boys playing their games' - and now is when the small investor can take advantage of that manipulation and start picking the crumbs left behind by the big boys by buying a few shares on the cheap.

The most notable number to look at right now is the BDSI market cap, which is currently at less than 100 million. To get an idea of just how ridiculous that market cap is for a company with an approved product in a thirty billion dollar sector (pain) and a technology that should continue to support new products, take a look at this statement copied from a recent PR issued jointly by Meda AB and BioDelivery Sciences:

Under the terms of its commercialization agreement with Meda, BioDelivery Sciences will receive an aggregate of approximately $27 million in milestone payments. The first is based upon FDA approval of ONSOLIS which is in the amount of approximately $12 million. Meda had already advanced the company $3 million in January 2009 against the $15 million milestone payment. A second payment of $15 million will be received following the manufacture of launch stocks of ONSOLIS, a target the company has also achieved. In addition, BDSI will receive a double-digit royalty on net sales as well as the potential for up to another $30 million in milestone payments upon the achievement of certain sales thresholds

Those milestone payments alone equal nearly a third of the current market cap without taking into consideration either the potential of the pipeline nor the possibility of Onsolis reaching the sales thresholds that would garner the additional thirty million dollar payment.

BioDelivery will also rake in double digit royalties on peak sales of the procut that are estimated to be in the neighborhood of $200 million annually. Granted, it shouldn't be expected that Onsolis would reach that number during the first year of sales, but it is worth noting that the US Patent Office has granted exclusivity for Onsolis until 2020 giving plenty of time for the company to enjoy the double digit royalty rate before the patent exipres.

Aside from Onsolis, which is expected to be commercially launched in the United States during the fourth quarter of this year, BioDelivery also has the potential to launch multiple products using the company's BEMA and Bioral drug delivery technologies.

Many BDSI investors are understandably nervous right now as they've watched the stock price drop and are unsure of whether or not a recovery is likely, but this is one of those situations that calls for disciplined buying - not panicked selling. As I've mentioned before, BDSI is no longer just a speculative biotech play. With the pending commercial launch of Onsolis and additional potential in the pipeline, it could be considered a long term growth stock.

When this stock starts trading to its potential a double in price could come in quick time before the gradual move up takes effect - in my opinion. The point being, don't be afraid of the recent dip in price - take advantage of it. They can't keep this thing down forever.

Disclosure: VFC is long BDSI.

Storm 300 x 250

Thursday, September 24, 2009

There's Still a Lot of Potential in Dendreon and the Cancer Immunotherapy Market

Dendreon released an update on Thursday that outlined the path that the company is taking to advance its prostate cancer treatment Provenge to market.

In a mid-day PR, the company announced that they will file an NDA with the FDA in November and that the FDA would then be expected to act on the application by mid 2010. It is expected that the FDA will rule to approve Provenge, based on previous comments by the regulatory agency after mid term results were released last year. Keep in mind, however, that nothing is a sure thing both in regards to the stock market or the FDA. While indications point to an FDA approval, it is also good to realistically temper the enthusiasm by remembering that members of the FDA are humans - government officials, at that - and are just as likely to change their minds or ask for more information as anyone else out there.

That being said, as longer term data continues to demonstrate that the treatments work, they are slowly becoming more accepted by the medical field; and Provenge is no exception.

I like the chances of a Provenge approval, although I think that by the time the treatment becomes approved in the United States, it will be long overdue. It was Oncophage, a kidney cancer vaccine produced by Antigenics (AGEN), that became the world's first approved cancer immunotherapy when the Russian medical authorities approved it in April of 2008.

Back to Thursday's DNDN press release - the company issued Provenge sales estimates of between $60 and $120 million for the second half of 2010. For full year 2011, the estimates were for well over one billion dollars as the manufacturing plant in New Jersey would by then have the capacity to produce the product at a level to support that much in sales. I was also reported in the press release that additional manufacturing facilities will be opened in late 2011 in Los Angeles and Atlanta.

Before we look at the potential of the DNDN stock, let us also consider the potential of the pipeline. Provenge is not the only product that Dendreon has to offer. The company also has Neuvenge in its back pocket. Neuvenge can potentially treat multiple cancers, including breast, bladder and colorectal.

When it's all said and done, there is a whole lot of potential still wrapped up in this company and its stock.

With a current market cap of over three billion dollars, DNDN is pretty much priced for possible approval, however I would expect to see the stock trading closer to thirty dollars by the time the FDA issues a decision next year. Assuming both that Provenge receives FDA approval and that the company's sales estimates are fairly accurate, I would expect fifty dollars a share to be attainable by the end of 2010.

From that point on, after a few quarters of Provenge sales, when we should have a good feel for just how much revenue is coming in, the stock could still move up very significantly - especially if Neuvenge looks to also be posting positive Phase II and III results by then.

There's a lot of "ifs" still left to sort out - the most important being that none of this occurs IF the FDA does not approve Provenge. However, IF the FDA does approve the treatment, which I consider likely, and the New Jersey manufacturing facility is fully ramped up by the timeframe outlined in Thursday's press release, then I can see DNDN becoming a hundred dollar stock a couple of years down the road, barring a stock split or a buyout.

Wait - There's more. Once Provenge is granted approval in the United States, I would expect to see a rally in the other cancer immunotherapy stocks, such as AGEN, ONTY and CVM.

Antigenics (AGEN) is preparing to launch the kidney cancer vaccine Oncophage in Russia in the fourth quarter of 2009 and is also awaiting a marketing approval decision by the EMEA in Europe. Oncophage did not meet the standards for a US approval in a previously conducted Phase III trial, but Russia granted approval based on a subset of patients that responded well to the treatment. Additional long term data collected from treated patients since that time has further demonstrated that Oncophage works, according to reports released earlier this year.

Also of note, once regulators and medical professionals began using patient survivability instead of tumor progression as a marker of success for cancer vaccines, it was hard to ignore the fact that extending the lives of patients is exactly what these vaccines were capable of doing. In my opinion, that fact was the highlight of this year's American Society of Clinical Oncology (ASCO) meeting. Hence the run for cancer immunotherapy stocks at the meeting's conclusion.

Also highlighted at the meeting for demonstrating positive late stage trial results was StimuvaxID, Oncothyreon's (ONTY) experimental cancer vaccine that will potentially treat various cancer indications, including lung and breast.

Biovest's (BVTI) BiovaxID also received honorable mention.

Notably missing from the media spotlight, however, was Cel Sci's (CVM) Multikine. Multikine is a head and neck cancer immunotherapy treatment that has been on the sidelines for some time awaiting the commencement of a Phase III trial which Cel Sci has recently stated may begin later this year. Multikine, in my opinion, could be huge if Phase III trials offer the same positive results as the Phase II trials did, and that potential makes the Cel Sci stock (CVM) that much more appealing as a long term investment.

It has long been my opinion that we are on the verge of something big in the arena of cancer treatment and I believe that the cancer vaccines are the next big thing. Patients and Doctors have been lobbying for years for these treatments to become available and it looks like we are getting close to the time that there wishes will be granted.

And yet the full potential of these vaccines is still untapped, in my opinion. They have only been tested on patients that are also receiving chemotherapy and/or radiation treatments, which wreak havoc on a body's immune system. If a cancer vaccine had a healthy immune system to work with - one that was not already beat down by time and other treatments - you have to wonder just how much more of a benefit the treatment would provide to the patient.

When Dendreon announced their plans for the future of Provenge, it offered an insight into what could be coming next for cancer patients, Doctors and investors of the sector.

With the potential of the cancer immunotherapy treatments now coming to light, we're looking at a scenario where everybody wins - patiens and investors alike. However, I always like to point out that the patients bear the true benefit of these treatments - life; an investor's financial gains are largely secondary and hugely unimportant by comparison.

Disclosure: No position DNDN, long AGEN, ONTY, CVM, BVTI.

Zecco Holdings

Readers Respond: More Comments on VNTA

A comment from Alejandro:

Hi VFC
Thanks for your time in this one. Even when I felt It was not a good share I have to admit that the big numbers caught my attention. I think would be better to consolidate my position investing more in biel and play a little with the idea that in short any news will do it rise.
I feel shame because vnta sound like it was such a "stupid" pick, but this kind of mistakes will help me to learn and take smart desicions from now as also will train my own smell test. I really enjoy reading the blog and most important I can learn a lot.
I wish you the best! Thank you very much for your time and share your experiences, that I insist is priceless.

(sorry for my poor English, please feel free to edit my posts before quoting it in your responding. I will not feel offended if you need to correct my comments as a matter of accuracy for the blog, may be I will be learning English too. LOL)


VFC's Take: There's no such thing as a "stupid" pick, Alejandro, just ones that don't pass the 'smell test' after the DD is done. You picked up on the same suspiciouns that I did when you looked at the stock which confirmed my opinion that VNTA could be a dangerous play.

VNTA could end up going on a nice run eventually, but any investors buying in now would be doing so somewhat blind - that's what makes it a bad investment, in my opinion. It's one of those 'too good to be true' stocks; the company pumps the potential of the product and throws out some enticing numbers but says very little about anything else.

Keep up the DD, research and motivation, Alejandro!

Disclosure: No position.

optionsXpress

Wednesday, September 23, 2009

Readers Respond: Pink Sheet Pleasures - AIRO, SFIO, INAR

In response to a number of requests that I've received via email or comments asking for 'VFC's Take' on numerous stocks that readers have found, I'll do my best to address as many as I can, as long as everyone takes a few things into account while reading:

- I have not thoroughly researched all of the stocks that I'm about to comment on. I've done the initial DD but my opinions are mostly based on my first impressions of the stock. I'm merely providing VFC's Take, as requested. Use that as a starting point to do your own DD.

- Don't get testy if I don't like your stock. Remember, this is just my initial impression and I take into consideration some variables that other people don't, that's why VFC's Take is not always the mainstream impression.

- I appreciate all the recent feedback, and keep the stock tips coming; this is a great forum for all investors of all levels to share tips and insights. There's a whole lot of stocks out there, but there's only a few gems. Let's keep trying to find those gems.

optionsXpress

AIRO: An anonymous comment regarding Airspan Networks:

I commented to you prior to Titans FDA surprise. I would now urge you to look at airn.pk, probable big gainer through the end of the year into 2010,, your readers will be grateful

airspan


VFC's Take: Airspan Networks recently conducted a reverse stock split and resumed trading under the new ticker of AIRO.

I'll be honest right off the bat and say that I usually don't get involved in small cap tech/Internet/Wifi related companies because of the fierce competition that is out there, not to mention the fact that the fierce competition is dominated by the big players. That being said, sometimes it's the small companies that come up with the best ideas and eventually become takeover targets for those big players.

Right now and in it's current state, I'm not a fan of buying this stock. Although the company's website is stacked with potential, the company's losses continue to mount and the management has done little of late (as far as I could tell) to indicate that a better management of finances is in the works.

While I can see the potential in this company and it's stock, I think that there are other options out there that are better buys for $1 than this one. As I said, I'm not quite a fan of small companies in this sector and I my initial impression is that the management team of this one is more interested in profits for themselves vice profits for the shareholders.

Disclosure: No positions.

Hotels Combined PTY LTD

SFIO.pk: A comment by msmith088 regarding Smokefree Innotec Inc.:

VFC's thoughts on Smokefree Innotec Inc (SFIO)

From msmith088


VFC's Take: I'm going to keep this brief: at the expense of sounding contradictory, the idea of a smoke-free cigarette device will either catch on big worldwide or will become a total bust as it fades into the distant memory of bad ideas. However, with most countries following in the footsteps of the USA regarding banning cigarette smoking indoors, this company could be onto something.

This is a good 'night on the town' stock - skip a night on the town, use the money to buy up a handful of shares and if the product makes it and the stock price follows your night on the town will become a trip to Europe. If the product fails and the stock drops you've lost some beer money but saved yourself a hangover.

With marketing and distribution agreements starting to roll in, I'll support a speculative buy with a market cap of 26 million.

Disclosure: No position.

Perfume Worldwide, Inc

INAR.pk: An email from Smithson regarding Internetarray:

whats up,

love your site, and insight given.
very pragmatic, and appreciate your input.
i'm a big investor in BIEL, but my question relates to INAR (InternetArray Inc).
what do you think about that as a long term play........september 15 is the plan for bidsellbuy.com to come online, and their investment/spinoff to noobis.com for facebook)

i have a small stake in the company, but thinks its a gem.
would love to know your insight about this company?

smithson


VFC's Take: Here's another 'night on the town' pink sheet stock. For the cost of a night out on the town a small investor could load up on this stock and hope that the company can turn it's Internet businesses profitable.

I like the idea of bidsellbuy.com and the spinoff that includes Facebook, but with a market cap of 100 million already, these businesses would really need to take off on a huge scale to make this company an investment vice a trade.

A true penny stock, as is INAR, would have a hard time drawing in serious investors, in my opinion. That being said, some do make it - but again, I'm sceptical with such a huge market cap for a company not yet trading for a penny.

However, a few bucks can get you a boatload of shares. If you're serious about the stock and your DD has you comfortable, I suggest buying a handful of 'base' shares that you will hold for the long term based on the potential of the new Internet businesses. Then buy a handful of trading shares that you can trade in and out on any significant spikes and dips - and there are sure to be plenty of those with a penny stock like this one.

Thanks for the comments and thanks for reading. Appreciate it!

Disclosure: No positions.

Readers Respond: BVTI, APPA

In response to a number of requests that I've received via email or comments asking for 'VFC's Take' on numerous stocks that readers have found, I'll do my best to address as many as I can, as long as everyone takes a few things into account while reading:

- I have not thoroughly researched all of the stocks that I'm about to comment on. I've done the initial DD but my opinions are mostly based on my first impressions of the stock. I'm merely providing VFC's Take, as requested. Use that as a starting point to do your own DD.

- Don't get testy if I don't like your stock. Remember, this is just my initial impression and I take into consideration some variables that other people don't, that's why VFC's Take is not always the mainstream impression.

- I appreciate all the recent feedback, and keep the stock tips coming; this is a great forum for all investors of all levels to share tips and insights. There's a whole lot of stocks out there, but there's only a few gems. Let's keep trying to find those gems.

optionsXpress

BVTI: A comment from Mark regarding Biovest:

VFC,

I just read your answer to another reader on BVTI and ABPIQ. I was lucky enough to buy BVTI a few days ago for .32 (whew! Just got in!). Can you explain in a bit more detail what the story is with the "Chapter 11" you referenced? Also, what significance is the parent company (ABPIQ) to the future of BVTI both negatively or positive? I bought BVTI in my Roth IRA so I am looking long term here. I may sell some if it hits $1 and buy back lower - I could see a dip coming soon. I also added some ACTC and BIEL in that Roth account since those are early development companies (I especially like ACTC as a stem cell play).

Thank you!

Mark


VFC's Take: The "Chapter 11" that I referred to is the fact that both Accentia and Biovest are still in Chapter 11 bankruptcy proceeding which have the potential to wipe out the common stock of both companies. It is not uncommon (pardon the pun) for the common stock of a company to survive Chapter 11 proceedings, but the possibility is there that any investment could turn into zero if the bondholders take over.

In my opinion, because of the potential of BiovaxID, I think that the common stock will survive. My position in this cancer immunotherapy company is nowhere near my positions of others in that category such as AGEN, ONTY or CVM, but it's enough to enjoy any potential gains if the company emerges from Chapter 11 with the common intact and proceeds to release positive BiovaxID updates.

Hope that clears up my position.

Disclosure: VFC is long BVTI.

f.y.e. 250x250

APPA: An anonymous comment regarding AP Pharma, Inc.:

Hi VFC!

What's your opinion on APPA? Seems like an unknown at this point, IMO.

Thanks.


VFC's Take: APPA passes my 'smell test' as a decent speculative play, although there are a few variables to consider - such as an imminent need for financing and the fact that there's no late stage products to fall back on if the FDA turns away APF530 in March.

I do think that APPI is trading a bit 'under the radar', as the reader mentioned, and that means that a good pop in price could be in store when/if good news is released. If nothing else the stock should inch upwards as the March date for an FDA decision approaches.

That being said, in order for the company to take the best stock price advantage possible for the next financing deal, any increase in price would need to come soon since there's only enough cash left to last through the fourth quarter of 2009, according to a recent press release.

AP Pharma does have two other product candidates in the pipeline (one in Phase II, one not yet in Phase I), but the development of those products has been put on hold pending the outcome of the FDA's APF530 decision.

Should the FDA approve the drug, then I could see a market cap of roughly 100 million being reachable for the short term since the product would be entering a one billion dollar market, according to the company's website. That doesn't mean that I think that the product will approach 100 million in sales, I'm using an initial sales multiple of ten to come up with that number - meaning I could see 10 million in sales for the first year on the market. I know some will say that's a conservative number, but a 100 million market cap would equate to a quadruple in stock price from it's current prices.

Regardless of the FDA outcome in March, I would expect the stock to drift to over a dollar before that date.

Disclosure: No positions.

HANDBAGS at FORZIERI.COM

Readers Respond: VNTA

In response to a number of requests that I've received via email or comments asking for 'VFC's Take' on numerous stocks that readers have found, I'll do my best to address as many as I can, as long as everyone takes a few things into account while reading:

- I have not thoroughly researched all of the stocks that I'm about to comment on. I've done the initial DD but my opinions are mostly based on my first impressions of the stock. I'm merely providing VFC's Take, as requested. Use that as a starting point to do your own DD.

- Don't get testy if I don't like your stock. Remember, this is just my initial impression and I take into consideration some variables that other people don't, that's why VFC's Take is not always the mainstream impression.

- I appreciate all the recent feedback, and keep the stock tips coming; this is a great forum for all investors of all levels to share tips and insights. There's a whole lot of stocks out there, but there's only a few gems. Let's keep trying to find those gems.

optionsXpress

VNTA.pk: A comment from Alejandro regarding Ventana Biotech:

Hi VFC
Thanks for your comments, yes I´m in with BMSN and adding shares while is under 0.1. It will be a very long trip until see results of their new studies, but that is good because meanwhile I would be able to add more shares.
Another pick here VNTA, even when the lack of real information makes me wonder if this company is doing it for real, I would like to add a little position just in case. what do you think about doing it? it´s a newbie mistake chosing a bad company or it could be a real position in the future? (the idea is try to be on house for this one but maybe is smarter go for more of biel or another stock with real potential like csuh)
Thanks in advance!


VFC's Take: Alejandro, I like your stock-picking style. Another good idea behind this stock, so don't mistake my attempt at humor as a bash on you pick, but I'd pass on VNTA for the time being!

As I looked over the information regarding Ventana Biotech, I couldn't help but think of Clint Eastwood's classic, "The Good, The Bad and The Ugly."

The good: Appetite suppressing chewing gum is a novel idea, but I'm not quite sure that it's unique. Hoodia, the active ingredient, is being used in everything right now (including lollipops) and I'm not convinced that putting it in chewing gum is going to make it a blockbuster. That being said, it would do pretty good on the market - in my opinion - and would most likely cause a nice boost in stock price should it get so far as store shelves.

The Bad: The company's website, the PR department and the lack of information regarding how far along the company is in developing their (according to them) billion dollar products.

It's bad business to talk the talk, as this company seems to do, while not releasing ANY information to the public about where the product pipeline stands at any given time.

The Ugly: It's hard to come up with price potential for a stock when the company does not issue any related stock information aside from price. Granted, I didn't dig all that deep, but there's no accurate information out there (if any) that details how many shares there are that are outstanding with VNTA. All of this boils down to ugly management.

Here's a quote taken directly from one of Ventana's "Love this company" pages of propaganda: "World class management, an accomplished scientific team and a truly unique product." Really? I can't speak for the scientific team because us potential investors can't even tell if they're really at work, but as far and the management team goes, I'm not impressed. The website stinks, the PRs are vague and the lack of stock info is embarrassing.

Don't get me wrong, I sometimes will give management of biotech companies a pass on some of this common sense stuff because most of the time they're just brains. You know the kid in the third grade that spits out advanced Algebra equations without breaking a sweat? But then he can't tie his own shoes or hold a conversation if it involves more than himself and the chalkboard? Those kids grow up to become CEOs of biotech companies and sometimes they deserve a pass when it comes to common sense.
In the case of Ventana, however, I'm not willing to ignore the bad and the ugly and give the company a pass.

You made a good assessment, Alejandro, you saw the red flags and decided that if you get in this one you want it to be on house money for a 'just in case' scenario. You also mentioned that you may be more comfortable adding BIEL or CSUH because you already know that the potential is there for both.

I say go with your instincts and pass on VNTA. As a small investor, I think it's a wiser decision to go after investments that we know more about. This company has indicated that it is striving for the OTCBB market and that more detailed pipeline information is pending in 2010, so we may have a better idea about the reality behind the hype by then, but right now I have a hard time swallowing the unknowns.

At this point, any gains would be the result of luck and not the result of DD. If you get in, go in small. I'm also fairly certain that any price increase would be quickly followed by an announcement of financing that would drop the price again - offering up another opportunity to buy if the news leading to the spike in the first place were good.

A last bit of advice - wait and watch it for a week. If it still looks like an appetizing buy, then get in. Like the women when they shop for new shoes - we tell them to go home and sleep on it before making that impulse buy! Of course in that case, impulse becomes reality the next day.

All just my opinion.

Disclosure: No position.

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Readers Respond: Contacting IR

A comment from Mark regarding contacting a company's IR division:

VFC,

Thanks for the timely response about where to go for information, Consider it copied into my ever growing notebook file of information to re-read. One more question (for now :-p ) have you written investor relations for information? Is this normal? Has it helped you make decisions and what sorta information do you ask for?

Russ


VFC's Take: Thanks for the question, it's a good one - especially for new investors.

I have contacted the IR departments of various companies in the past - and sometimes I still do - but for the most part I've found that it's not worth the time.

First of all, it's very, very unlikely that you will discover any new information from IR that is not already readily available somewhere on the Internet. If a company wants the investors to know something, then they'll issue a PR, period. If they don't want investors to know something then the IR department isn't going to fold in a moment of weakness and release the info to Sal from the Bronx.

I like to consider Google the IR department for any company, because you can type in any key words you want about that company and find everything from official documents, news reports, blogs, opinions - it's all out there. I often will type in the word "fraud" after the name of any company that I'm researching in order to get an idea of what, if any, negative press might be out there and then I'll judge the relevancy and accuracy of the bad press for myself.

There is good information to be had from IR, however, most notably being clarification and tone. The IR staff is usually happy to clarify any already released information that may be confusing to individual investors (those who were brought up in the NYC Board of Education know what I mean). As for tone, sometimes you can get a better feel for how a person is really feeling about a subject by the tone of his voice or the wording of his words; if you're good at surmising when someone is feeding you a line of BS, the 'tone test' can come in handy for you.

Rather than contacting IR, I rely on conference calls for clarification. I do pop an email to CC moderators every now and then during calls and I always listen in order to get a feel for a CEO's and CFO's tone.

A confident CEO who doesn't speak like he's feeding you a line is worth the company's weight in gold - in my opinion. For example, one reason why I've stood behind Celsius Holdings (CSUH.ob) is because through correspondence and conference call attendance, I've surmised that CEO Steve Haley is a no-BS kinda guy and he's done nothing to have me change that opinion thus far.

Use your resources when conducting DD; IR is definitely a resource but don't expect the world when you contact that department of a company.

And remember one thing - the best resource out there that has allowed the small investor to make huge strides over the past decade is the Internet. Use it - even if wifey starts riding you to watch Access Hollywood at night; once she gets that first pair of Prada shoes or a trip to Europe as a result of your computer 'DD time', she'll understand.

optionsXpress

Readers Respond: ARDM

In response to a number of requests that I've received via email or comments asking for 'VFC's Take' on numerous stocks that readers have found, I'll do my best to address as many as I can, as long as everyone takes a few things into account while reading:

- I have not thoroughly researched all of the stocks that I'm about to comment on. I've done the initial DD but my opinions are mostly based on my first impressions of the stock. I'm merely providing VFC's Take, as requested. Use that as a starting point to do your own DD.

- Don't get testy if I don't like your stock. Remember, this is just my initial impression and I take into consideration some variables that other people don't, that's why VFC's Take is not always the mainstream impression.

- I appreciate all the recent feedback, and keep the stock tips coming; this is a great forum for all investors of all levels to share tips and insights. There's a whole lot of stocks out there, but there's only a few gems. Let's keep trying to find those gems.

optionsXpress

ARDM.pk: A comment from Mark regarding Aradigm Corp:

VFC,

How does ARDM fair on your 'smell test"? I had it back in the Novo partnership days with inhaled insulin P3. As you may remember, INHL/Pfizer's inhaled insulin was thought to be causing lung cancer and the dream of insulin delivered through an inhaler for diabetics as opposed to a needle (something I watched my father do every morning for years) was dead for ARDM and INHL. Now at .18 cents it has shown positive P2a data with its patented AREx delivery system to treat cystic fibrosis.

I respect your opinions and as always thank you for your informative writing.

Mark


VFC's Take: Thanks for the comments, Mark.

In a post on August 6th I called ARDM a decent long term speculative play and I stand by that assessment, especially with the stock now trading for under twenty cents.

I wouldn't go crazy buying since it's still only a 'Phase II stock', but these are attractive prices to pick up the pace of accumulation because a small investor could sell into any price spike and have the initial investment covered; that would leave the remaining shares on 'house money'.

Decent long term accumulation pick - but one on which I'd play the spikes and dips in order to reduce exposure to downside risk.

Disclosure: No positions.

Briefs: KERX, GNBT, MSBT, SPNGE

KERX: Shares of Keryx Biopharmaceuticals jumped to over three dollars on Wednesday morning after the company reported positive long term results of Zerenex for the treatment of Hyperphosphatemia. The results were based on an Open Label Extension (OLE) of an already concluded Phase II trial.

While I still believe that KERX is a good long term investment and have no problem with anyone holding through this news, I have to admit that I could not resist the near triple in price of my shares of KERX and sold on Wednesday morning for $3.05.

It's a risky play because KERX is going to enjoy even bigger gains later on down the road, in my opinion, but I think a pullback to below $2.50 is likely because of the quick spike and I'll be looking to get back in then.

With some of my KERX gains I decided to pick up some shares of GNBT for seventy five cents. Generex, in my opinion, is either going to hit it bigtime or disappear in a case of curious futility - there's no in between. There's too much potential and too many novel new products to not take a chance with that stock, but it is curious as to why there is no money yet coming in for all the pumping that the company does about itself and it's already-approved global products.

With all the recent financing that the company has announced, it's time for Generex to start walking the walk that the company has talked - and I'll be along for the ride if things take off.

I'm still a fan of KERX for the long term, but I couldn't resist a sell order into the rapid rise because runs like that are usually followed by periods of pullback and consolidation; keep in mind that KERX is a triple in just under a month.

Congrats to longs of KERX and good luck to shareholders of GNBT.

Disclosure: VFC is long GNBT and has no position in KERX.

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MSBT.ob: Shares of Medasorb Technologies have been on a rapid rise in terms of price and volume over the past week or so, nearly doubling in price during that time frame. For months the stock price was stuck at the six cent level, giving investors a nice opportunity to accumulate, but the recent move has drawn increased interest to the stock.

That being said, I sold a handful of shares (about 1/7 of my position) into Wednesday's continued price spike in order to free up some cash and to reduce my overall risk to this investment by taking some money off the table after those shares had doubled in price.

Nothing is a sure thing in the stock market - even with the potential of Cytosorb - so I will take some money off the table on any major price spikes (a double is considered major in my book), although I may buy those shares back if the price drops back down to below eight cents or so.

I still believe that this stock will at least surpass the fifty cent level - if not a dollar - barring any unforeseen bad news leading into the first and early second quarter of 2010, but I also think that the company is going to have to raise capital before then making dilution - and therefor another drop in price - a possibility.

For now, I have no problem enjoying some freed-up cash to buy back in on any dip in price - but I also won't mind to see the run continue.

I'd love to see some good news released regarding the progress of Cytosorb, but I have a feeling that the next announcement will equal dilution.

Disclosure: VFC is long MSBT.

8x8, Inc.

SPNGE.ob: SpongeTech had the scarlet letter "E" strapped to the tail end of it's stock symbol recently as the company is late in filing it's annual 10-K report. The company also needs to re-state FY2008 financial results and is allowing the new auditors time to do there job. Also of note, the previously announced reverse stock split has been cancelled until after the 10-K is filed and the share price dropped to under ten cents.

On the plus side, when Serena Williams lost the plot during her recent outburst at the US Open, she did so in view of a SpongeTech advertisement - which equates to a lot of free coverage and publicity for the company.

Let's wait and see what the newly filed 2008-09 fiscal reports have to say, but I don't think that anything has changed regarding the future potential of this company. Additionally, I believe that the drop to nine cents was unwarranted - both as a result of the questionable situation surrounding the auditors and also because speculative investors not happy with the announcement of the reverse split bailed. Therefor, I doubled down on my position of SPNG(E).ob at nine cents late last week.

I'll be honest that this stock does not hold one of the larger positions in my portfolio and I won't lose much sleep if the company doesn't make it, but there is enough potential here - especially at these prices, in my opinion - to make the possible rewards outweigh the risk.

Disclosure: VFC is long SPNGE.

optionsXpress

Tuesday, September 22, 2009

Readers Respond: BVTI

In response to a number of requests that I've received via email or comments asking for 'VFC's Take' on numerous stocks that readers have found, I'll do my best to address as many as I can, as long as everyone takes a few things into account while reading:

- I have not thoroughly researched all of the stocks that I'm about to comment on. I've done the initial DD but my opinions are mostly based on my first impressions of the stock. I'm merely providing VFC's Take, as requested. Use that as a starting point to do your own DD.

- Don't get testy if I don't like your stock. Remember, this is just my initial impression and I take into consideration some variables that other people don't, that's why VFC's Take is not always the mainstream impression.

- I appreciate all the recent feedback, and keep the stock tips coming; this is a great forum for all investors of all levels to share tips and insights. There's a whole lot of stocks out there, but there's only a few gems. Let's keep trying to find those gems.

optionsXpress

BVTI.pk: A comment from Lenny regarding Biovest and Accentia:

Hi VFC,

It was great to get your feedback, really appreciate it! It seems to be getting a little frothy out there and you are the voice of reason for many of us.

Noticed that BVTI is starting to show some life, are you still in it? I am wondering what to do with why holding. I was also wondering if ABPIQ (the parent company) would be a good investment.

Let us know your thoughts when you get a chance!

Lenny


VFC's Take: Yes, I still do hold shares of BVTI and have been watching the recent run without selling anything - yet. If the stock hits a dollar anytime soon then I may sell off a few shares that I bought for about a nickel in March or so, but I'll hold a base for the long term to see how BiovaxID turns out.

Biovest has turned into one of those 'Why didn't I buy more?' stocks for me, but I can't complaine too much since I was loading up on TTNP, AGEN, CVM and ONTY around the time I passed on loading up with more of BVTI.

As for Accentia Biopharmaceuticals, which owns 75% of Biovest, I think that for the first time in a long time the ABPIQ stock is a better buy right now than BVTI - after Biovest's recent run.

Put both stocks on the watch list and buy on any dips - or buy a few shares now (and hold some cash on the sidelines) so as to not miss out on a potential run, but I wouldn't be a fan of going 'all-in' after a run like this because of the possibility of a pullback.

That being said, the cancer immunotherapy stocks are quickly becoming more accepted in the market and there are few left that have product candidates in Phase III or beyond that are still trading for as 'cheap' as BVTI and ABPIQ right now.

In the past the company released Phase III results that were received as questionable by some, but later information was released that indicated that BiovaxID works. In similar fashion to most other cancer immunotherapies out there, the longer a patient receives the treatment, the better the results tend to be.

I'm enjoying this run by BVTI and I'd support anyone trying to get in now because as DNDN has showed us, when cancer immunotherapy stocks move - they move big.

Pick up a few shares if you haven't already and hold some cash on the sidelines just in case we see another dip.

Of not - Chapter 11 proceedings are not yet concluded. Investors have heard nothing negative regarding the outcome of the common stock of either company, but there's always the chance that the common could be wiped out. Another reason not to go 'all-in'.

Disclosure: VFC is long BVTI.

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Readers Respond: CRXX, AGEN, CVM

In response to a number of requests that I've received via email or comments asking for 'VFC's Take' on numerous stocks that readers have found, I'll do my best to address as many as I can, as long as everyone takes a few things into account while reading:

- I have not thoroughly researched all of the stocks that I'm about to comment on. I've done the initial DD but my opinions are mostly based on my first impressions of the stock. I'm merely providing VFC's Take, as requested. Use that as a starting point to do your own DD.

- Don't get testy if I don't like your stock. Remember, this is just my initial impression and I take into consideration some variables that other people don't, that's why VFC's Take is not always the mainstream impression.

- I appreciate all the recent feedback, and keep the stock tips coming; this is a great forum for all investors of all levels to share tips and insights. There's a whole lot of stocks out there, but there's only a few gems. Let's keep trying to find those gems.

optionsXpress

CRXX: An anonymous comment regarding CombinatoRx, Inc.:

Hi VFC,
What are your thoughts on CRXX? They have a drug that's going up for advisory committee review tomorrow.

Thanks.


VFC's Take: Although the CRXX stock dropped 15% during early trading on Tuesday, a pop is likely if the FDA review of the company's pain medication, Exalgo, is positive.

That being said, the stock will drop to below $1 - in my opinion - if the review is negative; that makes it a bit risky if you're looking to get in now.

I'm staying away from CRXX right now - the company is not on sound financial footing and a buy now would be a gamble on the FDA's review Wednesday. If you do get in now, make sure it's on house money.

Another option is to wait until after the review to buy in. If the review is positive then the company would most likely take advantage of an increased share price by announcing a financing deal which would would then most probably lower the stock price again. That would be a good time to get in because you'd have a better idea about the success of Exalgo but you wouldn't be carrying the risk of a negative review.

Stand by your DD. I'll reconsider my opinion of CRXX if drops below a buck.

Disclosure: No position.



AGEN, CVM: At the expense of giving readers an AGEN and CVM overload, I'll respond to a comment regarding my mid and long term price targets for these two stocks.

An anonymous comment:

Your analysis of agen and cvm is much appreciated. Your often refer to agen as a mid to long term investmet. Curious as to your definition of m-t and l-t and where you see the price eventually going accordingly.
Thanks


VFC's Take: Here's a rundown of how I personally apply timeframes to my short, mid and long term picks.

Quite simply, I consider a short term pick to be any stock that I feel will pay off fairly significantly within six months; mid term is six months to two years and long term I consider to be two years or more.

For the long term I think that we could see both AGEN and CVM become billion dollar companies (in terms of market cap), but I'm not going to be so quick to make that judgement until we see more from Oncophage and Multikine in respect to European and FDA approvals. Both companies will have a much better chance at approval, in my opinion, if Dendreon's Provenge is approved here in the US.

In the short to mid term, I can see AGEN being a five dollar stock, but a successful Russian launch of Oncophage, a positive opinion on the cancer vaccine by the EMEA and the continued success of QS-21 could launch the stock price into the mid teens - in my opinion.

CVM could approach five bucks, in my opinion, if the LEAPS swine flu trials look good. For the short term, I wouldn't be surprised to see three dollars but I also wouldn't be surprised to see it hover near where it is now. I am pretty certain about one thing, however; CVM won't see sub-$1 again, barring any unforeseen bad news or price manipulation.

Hope that clarifies what I consider to be short/mid/long term picks, and keep in mind that I'm in AGEN and CVM for the long term - the day to day price swings don't really interest me much.

Disclosure: VFC is long AGEN and CVM.

Readers Respond: PSDV

In response to a number of requests that I've received via email or comments asking for 'VFC's Take' on numerous stocks that readers have found, I'll do my best to address as many as I can, as long as everyone takes a few things into account while reading:

- I have not thoroughly researched all of the stocks that I'm about to comment on. I've done the initial DD but my opinions are mostly based on my first impressions of the stock. I'm merely providing VFC's Take, as requested. Use that as a starting point to do your own DD.

- Don't get testy if I don't like your stock. Remember, this is just my initial impression and I take into consideration some variables that other people don't, that's why VFC's Take is not always the mainstream impression.

- I appreciate all the recent feedback, and keep the stock tips coming; this is a great forum for all investors of all levels to share tips and insights. There's a whole lot of stocks out there, but there's only a few gems. Let's keep trying to find those gems.

optionsXpress

PSDV: A comment from K regarding pSivida Limited:

Good day to you. I was looking at the recent run that pSiVida (PSDV) has had and I was wondering if you could give your take on whether it is fairly valued at its current price or if you think it still has more upside. Really appreciate your input. Thanks!

Regards,
K.


VFC's Take: PSDV has enjoyed a great run this year - congrats to all of those investors who were along for that ride!

Ordinarily I shy away from buying stocks that have already enjoyed such a great run, but I do think that there is some more possible upside to PSDV, while trading for a relatively low market cap of roughly 100 million; I don't, however, see another ten-bagger in the works, or even close to it.

Interim Lluvien Phase III trials are due to be released later this year and those results will dictate when the company files for approval; at this time, Psivida anticipates filing an NDA in early 2010, according to the company's website. If positive, those results could send the stock on an uptrend towards ten dollars - in my opinion. Additionally, Psivida should start enjoying royalty income for Retisert, a product licensed to Bausch & Lomb, in early 2010.

The big move for PSDV is out of the way, but the current uptrend could continue, in my opinion, to a market cap of about 150-200 million - based on the potential of current products and anticipation of the Phase III interim results.

I think PSDV is a better long term hold based on the prospects of the company's drug delivery system, rather than a short to mid term trade.

Disclosure: No positions.

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Readers Respond: AGEN, CVM, BDSI

In response to a number of requests that I've received via email or comments asking for 'VFC's Take' on numerous stocks that readers have found, I'll do my best to address as many as I can, as long as everyone takes a few things into account while reading:

- I have not thoroughly researched all of the stocks that I'm about to comment on. I've done the initial DD but my opinions are mostly based on my first impressions of the stock. I'm merely providing VFC's Take, as requested. Use that as a starting point to do your own DD.

- Don't get testy if I don't like your stock. Remember, this is just my initial impression and I take into consideration some variables that other people don't, that's why VFC's Take is not always the mainstream impression.

- I appreciate all the recent feedback, and keep the stock tips coming; this is a great forum for all investors of all levels to share tips and insights. There's a whole lot of stocks out there, but there's only a few gems. Let's keep trying to find those gems.

optionsXpress

AGEN, CVM: An anonymous comment regarding Antigenics (AGEN) and Cel Sci (CVM):

Hi VFC,

I noticed this morning that CVM has a market cap of almost 300 millions while AGEN is just under 200 million. Do you think AGEN is a 'better' investment at this time?


VFC's Take: Great question.

It's been no secret that I like the potential of both of these companies and their stocks and while both have already traded significantly up this year, a continued move is possible.

AGEN, in my opinion, will be looked back upon as a no-brainer for $2, so any investment in Antigenics for at or near the current prices will turn out to be a good one - remember, that's just my opinion. Even as the company announced an expansion of the QS-21 license, there's more news pending regarding Oncophage that could send the stock higher.

CVM will also be a winner of a stock, in my opinion, but I would be wary of a little bit of a pull back as the stock rises to over $2 during pre-market trading on Tuesday. That being said, CVM is now a 'swine flu' stock and the current upwards momentum could continue until the stock sees a market cap of between 400-500 million (comparable to NVAX) - especially if the company announces the commencement of the Multikine Phase III trial.

I still see both companies as solid mid to long term investments, but I wouldn't go 'all-in' with CVM right now after the most recent run. I'd buy a few shares and see what happens; if it dips down to the mid-$1 range, buy more. If it continues to run, you won't have completely missed out on the run and you'll still have some money on the sidelines to play any potential dips.

Rest assured, a year or two down the road and I do believe that both stocks will be trading for significantly higher than they are now. Cel Sci's LEAPS technology looks to be for real and AGEN is just waiting for the manipulation to cease so that the stock could trade to it's potential.

If you look at both companies as long term investments, I think that they are both good buys right now, but for the short term, AGEN could be a better immediate buy - while keeping in mind that if the LEAPS swine flu trials come out positive, CVM could rocket.

Disclosure: VFC is long AGEN and CVM.

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BDSI: A comment from Patrick:

have you found any updates on BDSI? haven't heard much from them since their FDA Approval and the stock has shown weakness after a temporary recovery to $5. I averaged down but some progress from them on their approved drug would be comforting to us investors.

Thanks!


VFC's Take: BioDelivery has not released any new news of late regarding Onsolis or the progress of the remaining pipeline products and technology. However, I'll refer to my 'Exercise Patience' article regarding how I feel about waiting for updates.

I don't like companies that feed investors 'fluff' updates just to keep them interested (my news RSS feeds are cluttered with PR after PR from C and SIRI); I like companies to release valid news as it materializes. That way any stock price increase is more likely to hold. Your own DD should make you comfortable in your investment, not the company issuing a fluff PR that essentially says, "Hold onto your shares." At this point, we know that Onsolis is approved. The next time I want to hear from the company is when they are either ready to issue a launch date for the product or are announcing a partnership/buyout.

Another reason why I'm not a fan of 'fluff' PRs is because any extended periods between news releases offers small investors a good time to accumulate the stock. You mentioned that you've been able to average down recently and - manipulation aside - you may not have had that chance if the company was issuing 'fluff' PRs during that time frame.

I stand by my assertion that BDSI is a nice long term growth stock at this point - and the stock will have it's day. If that day is not tomorrow, no worries - things don't always happen overnight; but you don't want to be on the sidelines if/when the stock starts to climb towards it's potential.

Be confident in your DD - if you felt BDSI was a good buy a few months ago, then it should still be considered a good buy today because nothing has changed - except they now have an approved product which will soon start bringing in revenue.

Disclosure: VFC is long BDSI.

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Monday, September 21, 2009

Readers Respond: BIEL, GETA, New Investor Questions

In response to a number of requests that I've received via email or comments asking for 'VFC's Take' on numerous stocks that readers have found, I'll do my best to address as many as I can, as long as everyone takes a few things into account while reading:

- I have not thoroughly researched all of the stocks that I'm about to comment on. I've done the initial DD but my opinions are mostly based on my first impressions of the stock. I'm merely providing VFC's Take, as requested. Use that as a starting point to do your own DD.

- Don't get testy if I don't like your stock. Remember, this is just my initial impression and I take into consideration some variables that other people don't, that's why VFC's Take is not always the mainstream impression.

- I appreciate all the recent feedback, and keep the stock tips coming; this is a great forum for all investors of all levels to share tips and insights. There's a whole lot of stocks out there, but there's only a few gems. Let's keep trying to find those gems.

optionsXpress

BIEL.pk: A comment from myhwy61:

Analytst call biel at .25-.50 after fda approval. To quote the movies "do you concur?"
Ultimately do you see Biel in the business or a buyout? As a buyout this stock has massive upside? As a mfg concern almost as good but the Buyout would take them from say 1.25 to say 17.50 overnight. I am just spouting trash here but what are you views of said eruption.


VFC's Take: I do concur that BIEL is going hit the .25-.50 range at some point in the short to mid term, I'm not convinced that the FDA approval news alone will do it.

Ultimately I think that BIEL for under ten cents will be one of those "Why didn't I buy more?" kind of stocks, but I think that global sales numbers will be the true catalyst for the stock - not just the FDA approvals.

The stock is slowly moving up - while taking breaks for consolidation - and I think that the technology will be a global hit as people move away from Tylenol and Ibuprofen because of the health risks, but I think we're looking at a gradual rise and not an overnight hit.

In response to the buyout question: A buyout is a possibility, I'm actually surprised that the technology has not been picked up yet, but I'm not ready to put the 'billion dollar' number on the products just yet. Down the road, yes, but not yet.

Take advantage of the dip to below ten cents - in my opinion.

Disclosure: VFC is long BIEL.

Total Merchant Account

GETA.ob: A comment from Lenny:

Hi VFC,

Hope you are having a relaxing weekend!

I want to thank you for watching my back last week with GETA. The Thursday/Friday ride was wild. I owe you another beer (or 2)!

Question - with Tang and the folks at the Street as 'investors' in GETA (like AGEN - so why am I not surprised with the 'subtle' manipulation going on!), and with the pivotal FDA decision upcoming, do you think this may warrant a second look? The stock has almost become a rock star with all the hype and rumours, and I am guessing it is something that is preferable to be played with house money since this has become a high risk stock and you tend to find a way to reduce the risk in your approach.

For your readers benefit, FDA is reviewing Genasense which appears to lengthen the lives of people stricken with Melanoma who have relatively low LDH. GETA has been refused in Europe and by the FDA, and this is probably their 'last stand' (During the refusal time, there was a realization that there was a inverse relationship with LDH and Genasense). Note that their share structure is complex, as they appear to have over 500 million common shares with all the convertables outstanding.

I guess I am trying to understand if there are any parallels with DNDN that you can share with us?

Tough questions again, but I trust your experience and instincts.

Tks,

Lenny


VFC's Take: Interesting comment, Lenny, thanks. My take on the stock is to take the recent gains and run. I missed the boat on the run from thirty cents and I may miss out on another run if the FDA changes course regarding Genasense, but there's still a whole lot of risk with this one - in my opinion.

I can understand why one would want to take a position in the stock now, but like you said, if you play the stock - play it on 'house money'.

Let's look at it sceptically: the company has a drug that has been denied time and again by the FDA and overseas regulators and now, right before another review by the FDA, all the hype and rumor comes out. That makes me wonder if the stock is being played.

If I was on the fence at thirty cents, I'm not even close to the fence now. But keep in mind, that's just one guy's opinion, so do your own DD and invest accordingly.

The kicker is that if Genasense is done, then the company becomes another Cell Genesys, in my opinion, and the stock will trade for sub ten cents in the near future.

Proceed with caution. I think that for ninety cents there are better bets out there with more in the pipeline than GETA.

Disclosure: No position.

Circa Jewels

A comment from a new investor:

Hi VFC,
I'm new to the stock market game, just over 2 weeks now and I've been reading over your past posts. Very helpful. I've read through a few posts multiple times now just to memorize sound ideas.
I see you do alot of medical related stocks. Other than that companies website, is there anywhere specific you suggest going for information? and how does one go about getting expected release date of clinical trial information + FDA approval/unapproval?

Thanks, love the blog. Learning alot. Already made a few of the mistakes you talk about in your "Investings lessons learned" post.


VFC's Take: First of all, welcome to the stock market. In my opinion, there's no better way to put your money to work than to put it to work yourself.

As for your questions: When looking at biotech companies, I always start by looking at the pipeline. I look to see how advanced the pipeline is (trial phases), how much money could the products potentially bring in and how much competition is already out there?

From there I'll research the quarterly/annual reports and scroll through any and all press releases to find any relevant info (partnerships, trial results, etc.). Usually you can find the estimated dates for FDA decisions in those reports, but you can also watch the FDA's website. For the progress of clinical trials you can monitor the company's own PRs or clinicaltrials.gov.

SEC filings are also must reads and usually those are posted in the Investor Relations portion of the company website, but you can also take a look at the SEC's own site.

Other factors to consider are market cap and the need for additional financing. You don't want to high of a market cap for a company with nothing past Phase II - in my opinion, and the need for additional financing will most likely lead to stock dilution; not a show stopper for biotechs, in my opinion, but definitely something to keep in mind.

Last, but not least, Google search your stock - maybe even using key words for specific information regarding the potential of a particular product. You'd be surprised what's out there.

There's a whole lot of information out there and I don't suggest buying anything that doesn't pass your 'smell test'.

Also, don't trade on emotion - it's easy to make impulse buys when you're just starting out, so try to control that urge and take the time to research whatever it is that you want to buy. Your money is best left under the 'Cash Balance' than it is in a bad investment.

Another tip - when you scroll through your holdings, you should be able to look at every stock that you own and know why you bought it. If you don't, then you either need to re-do your DD or even sell it until you figure out why you bought it in the first place. That's where entry/exit strategies come in, don't be left in the cold when your stock moves as whether to hold, buy more or sell. If you can't remember why you bought a stock, you're not informed enough to make that call.

Good luck!

Realty Trac

Readers Respond: GNBT, TTNP, VFC's Take on Margin Trading

Back from an out of town trip.

Bear with me as I try to make it through the growing backlog of emails comments!

In response to a number of requests that I've received via email or comments asking for 'VFC's Take' on numerous stocks that readers have found, I'll do my best to address as many as I can, as long as everyone takes a few things into account while reading:

- I have not thoroughly researched all of the stocks that I'm about to comment on. I've done the initial DD but my opinions are mostly based on my first impressions of the stock. I'm merely providing VFC's Take, as requested. Use that as a starting point to do your own DD.

- Don't get testy if I don't like your stock. Remember, this is just my initial impression and I take into consideration some variables that other people don't, that's why VFC's Take is not always the mainstream impression.

- I appreciate all the recent feedback, and keep the stock tips coming; this is a great forum for all investors of all levels to share tips and insights. There's a whole lot of stocks out there, but there's only a few gems. Let's keep trying to find those gems.

optionsXpress

GNBT: A comment from Gillmore:

First, thank you, I made more money from you than my broker...seems I owe you either a steak or a bottle of great scotch. What is your opinion of Generex Biotechnology, symbol GNBT? They have 2 parts to their company; a revolutionary new drug delivery system and a novel vaccine business. They figured out how to encapsulate insulin and spray it through the cheek cell wall at 100 miles/hour without blowing a hole through a person's face. The drug penetrates the cell wall and then the encapsulation disolves...NO NEEDLES, NO PAIN, and nothing to inhale like the competitor MNKD. The delivery system can be used for other drugs as well such as morphine for cancer patients. The vaccine part of the business is working on cancer and the flu. They are testing with the Army's Walter Reed Hospital. I bought some in February because Phase III results for the insulin delivery system are due at the end of 2009 or beginning of 2010. Comments? Thanks in advance! How do you take your steak, medium rare...?

Gillmore Viltati


VFC's Take: I can support the idea of buying GNBT with some speculative money because I believe that this stock will be trading for over a buck in the not too distant future as investors take positions leading up to the Phase III results. If the Phase III Diabetes results - due out in either 4Q this year or 1Q next year - are positive, then another significant bump in price could follow.

Of note, the FDA has allowed emergency use of Generex's Diabetes drug as the Phase III trial continues. The emergency use will allow patients with life-threatening type 1 or type 2 diabetes who are not eligible for a current late-stage trial to receive the drug. The fact that the FDA is allowing the emergency use is not a hint as to where they stand on the effective of the drug, but it doesn't hurt any and it allows Generex to collect additional data on the drug's effectiveness.

If the drug delivery technology used in the diabetes drug works, then big things are in store for Generex and it's shareholders, period. However, if it doesn't work, Generex has an insurance policy in the form of an early to mid stage pipeline of vaccines that treat various cancer and flu indications.

Generex has been very busy raising money this year, and while it could be construed as a positive sign that the company could raise that money in a down economy, it's also time for shareholders to start seeing a return on their investment instead of consistent dilution.

There is a lot of potential wrapped up in GNBT and I think that it is a stock worth some speculative money while trading at these prices. As I mentioned before, I think a run to over a dollar is in store in the not too distant future.

Click HERE for the company's presentation from the annual shareholders meeting held in July.

As for how I like my steaks, I like them medium-rare; but keep in mind that I'm well aware that the market has a fickle mind and while I've enjoyed a nice run this year, that could turn at any given time and my name would be mud.

However, the more we share ideas and strategies, then the better off we all are. Thanks for comments, Gillmore!

Go Green and Save with RingCentral Fax

A comment from Alejandro:

Hi VFC.
It was really helpful!!! As always I want to truly thank you. I really apreciate your effort and all the time that you dedicate to share your priceless experience with us.
I can´t explain how value are this kind of advices (experiences) to me. I would like to repay your generosity, but it´s hard to find a way to do it when I don´t have the knowledge to help you, so I really hope to find a gem one of this days to share with you.
Thank you very much!! I will planning an strategy for each position that I have.
Good luck! and better DD.


VFC's Take: Real quick. The fact that you, as a small investor, have taken control of your own finances and are taking the time to figure out how to make it work for you the right way is thanks enough for me.

Also, I did pick up a few shares of BMSN.ob a while back; I believe that was an Alejandro pick.

Appreciate the comment!

FreeCreditReport.com

A comment from Mark:

VFC,

Back in the day of NASDAQ 5000 I turned about 7k into 154k in a few months investing in biotech's that are mostly long gone or dying now (TXB (later became ENCY), PARS, ARDM, GENXY, NSTK, RGEN, SERO, NFLD, etc). Of course I made the mistake of thinking the market would just keep going up and lost much (but not all) of that peak. As you have said, you need to learn from your mistakes and I have certainly done so. Much of that success back then was from using a margin account to "send it in". Of course this is a dangerous game, but can pay off big when you don't have big boy funds and as a little guy "trying to get crumbs off the table" (aka 7k to 154k). What are your feelings on using margins when you really believe in a stock(s). When I look at the price of some of these current biotechs (AGEN, CVM, BVTI, EPCT, etc) I feel they are very cheap compared to the previously mentioned (ENCY for example) which often traded at $4-5 at this stage (no revenue, approaching P3 and a promising pipeline). I am tempted to anti-up on some of these at this LOW level - such as CVM, AGEN, BVTI, ePCT. Ultimately this is a decision I have to make (will lightning strike twice?) but I am interested in your thoughts on the prices difference that I see these days. Possibly it is still a depressed pps due to the economy and the last 8 years of a down market compared to that glorious 1999/2000 prosperous time.

Thank you for your hard work and insight. I really enjoy your writing.

In Good Health,

Mark


VFC's Take: Great success and lessons learned story there, Mark, thanks for the comment!

My take on margin trading is this - it works for some, but I don't recommend it for the small investor. I've dabbled in it before, but in my opinion it's another way for the Big Boys (in this case the brokers) to try and milk more money from the little guy. I also don't like being on the hook for 'margin calls.'

As for the comment of "really believing" in a stock - that puts a little bit more emotion into stock investing than I like. Keep it real, trade with what you have and enjoy the returns as they come. At least if you lose on a stock, all you've lost is what you've put in to it. If you lose on margin you lose a lot more.

If margin trading is your game, all the more to you, but I don't recommend for small investors; especially those just starting out!

optionsXpress


TTNP: A comment from Andy:

VFC,

It's been a few weeks since you've made a mention of TTNP. I bought into the stock with hopes of a short term gain, but the closer we get to the fourth quarter without news makes me think that TTNP could end up being more of a long term play. Your take?

Andy


VFC's Take: Regarding TTNP, I will refer back to my post about Practicing Patience. My opinion on the stock and the prospects of the company have not changed and I do think that we'll see another move to the upside within the next month or so.

Fanapt is still due to launch in the fourth quarter - that fact has not changed - and since the fourth quarter begins in less than two weeks, there's no reason to sell now - in my opinion.

There are patent and partnership issues to be addressed that probably complicated things somewhat, but lets give the stock a bit more time. Titan is sitting in a pretty position right now, in my opinion, and I don't think it'll be too long before we see news.

Fourth quarter is just around the corner and the Fanapt launch is near - until we hear otherwise.

Nestle Waters

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