August 6, 2024 4:38pm

Recovering some losses from the previous trading days as investors consider recession fears

News: Through its Genentech research arm, Roche (RO. SW, ROG.SW & RHHBY) has licensed technology from Sangamo Therapeutics (SGMO) and plans to use it to create genomic medicines for select neurodegenerative diseases. The agreement grants exclusive rights to SGMO’s “zinc finger” molecules designed to repress the gene that makes “tau,” a protein many scientists view as a main driver of Alzheimer’s. <continued below re “bucks”>

Harvard Apparatus RT (OTCQB: HRGN +$0.37 after Monday 0, Friday’s 0, Thursday 0 and last Friday’s -$0.18) pumps the volume to save its share pricing with 2.073 shares traded, yet again after many agains. Ponzi scheme?

I say today what others won't, so you can do what others can't by sticking to the FACTS!

Never leave an investor uninformed!  

I follow the dictum, quoting Churchill that “short words are best, and the old words when short are best of all.”

 

Tuesday: The Dow closed UP +294.39 points or +0.76%, the S&P closed UP +53.70 points or +1.04% while the Nasdaq closed UP +166.77 points or +1.03%

Tuesday’s advance/decline line at the open was positive with 17 incliners, 15 declined and 3 flats; ending with a positive close of 23 incliner, 9 decliners and 3 flats

  • the IBB was up +0.45% and the XBI was up +1.08%
  • the VIX was down -10.67 point or -27.56% at 27.90

Economic Data Docket: The U.S. trade deficit declined in June but not by as much as expected, the Commerce Department reported. The goods and services shortfall fell to a seasonally adjusted $73.1 B, down $1.9 B from May but above the estimate for $72.5 B. Exports rose $3.9% while imports, which subtract from GDP, were up $2 B. At the country level, the imbalance with China fell to $22.3 B, down $1.6 B.

 

From the SGMO “News” in the title:

Sangamo Therapeutics (SGMO) expects to receive $50 M in near-term upfront license fees and milestone payments and is eligible to earn up to $1.9 B in development and commercial milestone payments across multiple medicines, as well as tiered royalties on net sales

 

(8/5) Monday: The Dow closed DOWN -1,033.20 points or -2.60%, the S&P closed DOWN -160.23 points or -3% while the Nasdaq closed DOWN -576.08 points or -3.43%

Monday’s advance/decline line at the open was negative with 0 incliners, 31 declined and 3 flats; ending with a negative close of 1 incliner, 31 decliners and 3 flats

  • the IBB was down -2.82% and the XBI was down -3.15%
  • the VIX was up +13.93 point or +59.23% at 37.32

Economic Data Docket: The ISM services index registered a 51.4% reading for the month; up from 48.8% in June and better than the Dow estimate for 50.9%.

 

RegMed Investors’ (RMi) pre-open: “after Monday’s bloodbath. Headwinds turn into tailwinds for some sector equities who have reported earnings to date. As investors wait out the share pricing depression with valuations, sentiment, confidence and investor positioning depressed.” …  https://www.regmedinvestors.com/articles/13570

 

Henry’omics:

We need to more than consider the economic environment - rising rates and inflation to comprehend the micro re “our” universe of cell and gene therapy companies …

Indexes jumped Tuesday, recovering some losses from the previous trading session.

The moves follow a sharp sell-off during Monday trading amid concerns over the state of the economy. Yesterday, Monday, the Dow dropped 1,033.99 points, or 2.6%, while the S&P 500 slid 3%. Both indexes notched their worst sessions since September 2022. The Nasdaq shed 3.4%. <CNBC>

 

Ebb and flow of MY covered sector cell and gene therapy session daily “endings”:

Q3/24

  • August: 1 positive and 3 negative closes
  • July: 1 market holiday. 1 day off, 6 negative, 1 neutral and 12 positive closes

 

Tuesday’s Closing Down (9 of 9):

  • Alnylam Pharmaceuticals (ALNY -$2.44 after Monday’s -$7.05),
  • Sage Therapeutics (SAGE -$0.43),
  • CRISPR Therapeutics (CRSP -$0.33 after Monday’s -$1.45),
  • Blueprint Medicine (BPMC -$0.23 after Monday’s -$3.75),
  • BEAM Therapeutics (BEAM -$0.09 after Monday’s -$1.82),
  • Editas Medicine (EDIT -$0.05),
  • Adverum Biotechnologies (ADVM -$0.02),
  • uniQure NV (QURE -$0.02 after Monday’s +$0.27)
  • Brainstorm Cell Therapeutics (BCLI -$0.0198),

Flat (3):

  • Bellicum Pharmaceuticals (BLCM)
  • Caribou Biosciences (CRBU)
  • Homology Medicine (FIXX)

Monday’s Closing Up (10 of 23):

  • Lenz Therapeutics (LENZ +$1.27 after Monday’s -$1.74),
  • Vericel (VCEL +$0.89 after Monday’s -$1.76).
  • BioLife Solutions (BLFS +$0.79),
  • Ultragenyx Pharmaceuticals (RARE +$0.69 after Monday’s -$1.39),
  • Harvard Apparatus RT (OTCQB: HRGN +$0.37 after Monday’s $0.00)
  • Mesoblast (MESO +$0.35),
  • Solid Biosciences (SLDB +$0.24),
  • Sangamo Therapeutics (SGMO +$0.223)
  • Voyager Therapeutics (VYGR +$0.22),
  • Agenus (AGEN +$0.19)

 

The BOTTOM LINE: Let the good time roll; did we enter a sector high … who’s smoking what!

  • Let the dust settle’ before entering the sector as markets rebound … August is historically a rocky month for the stock market due to lighter trader volumes.

 

The volatility will likely remain elevated in the near term as the carry trade continues to unwind …

  • The practice of traders borrowing in the cheaper currency to purchase other global assets.
  • The Bank of Japan last week raised interest rates, contributing to a rise in the yen. However, the yen retreated Tuesday following sharp spikes that added to worries over the carry trade.

 

“While the broader stock market is on the brink of entering correction territory, it’s typically wise to let a bit of dust settle before putting new money to work as there is risk of catching a falling knife during a correction. We would characterize the recent market pullback as a textbook correction, after months of low volatility so far in 2024,” <BMO Family Office chief investment officer Carol Schleif.>

 

 I am NOT giving up … hope evaporated however it is not a fundamental metric with sector earnings downtrends as usual!

  • Once earnings come-out, there will be an upside bounce but, we weren't exempted from moving - TODAY - by market forces recently motivated by FEAR and the devoid of confidence
  • The short and near-term are compromised for the periods of time as the LONG view gets complicated!
  • As Q2 earnings numbers sweep … hold tight more earnings numbers on the way, we can NOT battle the downslide!

 

Cell and gene therapy sector share pricing popped on Tuesday after Monday’s decline in a new week, last Friday and Thursday after inclining on the previous Wednesday following Tuesday’s decline and Monday after Friday’s positive close following Thursday’s upswing after diving on Wednesday following Tuesday and Monday’s bubble-up positive closes …

  • Without “uncle algo and his electronic dwarfs”, the cell and gene therapy sector flipped to the upside! 

 

Earnings “whispers” (Zacks): Expectation …

Caribou Biosciences, Inc. (CRBU) is expected to post quarterly loss of $0.45 per share in its upcoming report.

  • Revenues are expected to be $3.31 million, down 12% from the year-ago quarter.

Prime Medicines (PRME) Consensus Estimate for loss per share in Q2 is pinned at -$0.40.

  • R&D expenses have likely seen an increase inQ2, driven by expenses related to the advancement of its pipeline and platform. G&A expenses will increase due to expansion of clinical activities.

AxoGen (AXGN) is expected to deliver a year-over-year decline in earnings on higher revenues when it reports results for Q2/2024.

  • is expected to post quarterly loss of $0.05 per share in its upcoming report, which represents a year-over-year change of -66.7%.

Precigen, Inc. (PGEN), another stock in the same industry, has yet to report results for the quarter ended June 2024.

  • Expected to post quarterly loss of $0.09 per share in its upcoming report, which represents a year-over-year change of -12.5%. The consensus EPS estimate for the quarter has been revised 12.5% lower over the last 30 days to the current level.
  • Revenues are expected to be $1.28 million, down 27.7% from the year-ago quarter.

 

Reiterating, “There’s more room for “tactical downside in the weeks to come as we enter the gauntlet of the weakest two months and only consecutive losing months for equities, with markets at all-time highs.”

 

Q3 and August to date:

  • Tuesday ended with a positive close of 23 incliner, 9 decliners and 3 flats
  • Monday ended with a negative close of 1 incliner, 31 decliners and 3 flats
  • Friday ended with a negative close of 5 incliners, 28 decliners and 2 flats
  • Thursday ended with a negative close of 4 incliners, 29 decliners and 2 flats

 

Electronic trading pops and flops the cell and gene therapy sector

  • There is past evidence of a slowdown coming (it’s the contrarian in me) and it's going to become even more thin as we go forward into Q2 earnings season

 

Due “dates” for Q2 LPS (loss per-share) earnings releases:

  • Editas Medicine (EDIT) Wednesday, 8/7
  • AxoGen (AXGN) on Thursday, 8/8
  • BioLife Solutions (BLFS) on Thursday, 8/8
  • Intellia therapeutics (NTLA) on Thursday, 8/8

 

The top three (3) performing in the session:  just one of my covered/reporting group

  • Tuesday: Lenz Therapeutics (LENZ), Vericel (VCEL) and BioLife solutions (BLFS)
  • Monday: uniQure NV (QURE)

The worst three (3) in the session: 

  • Tuesday: Alnylam Pharmaceuticals (ALNY), Sage Therapeutics (SAGE) and CRISPR Therapeutics (CRSP)
  • Monday: Alnylam Pharmaceuticals (ALNY), Blueprint Medicine (BPMC) and Ionis Pharmaceuticals (IONS)

 

Welcome to my world of defining the “grey’ in our universe!

  • Right up front, “I also hate to be so negative or contrarian but, this is a NO spin zone and facts are its product; I can always be WRONG but … I am mostly EARLY!”

 

Opinions expressed are those of the author and are subject to change, and not intended to be a forecast of future events, a guarantee of future results, nor investment advice. Whether information or intelligence is good, bad, or somewhere in between; I put into context what is relevant and useful for investors.  All investments are subject to risks. Investors should consider investment objectives.

Henry McCusker, the editor, and publisher of RegMed Investors does not hold or have positions in securities referred to in this publication. Regulation Analyst Certification (Reg AC): The research analyst primarily responsible for the content of this report certifies the following under Reg AC: I hereby certify that all views expressed in this report accurately reflect my personal views about the subject company or companies and it’s or their securities.

I also certify that no part of my compensation was, is or will be, directly or indirectly, related to the specific recommendations or views expressed in this report.