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Tandem Diabetes Care

5/23/2018

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Tandem Diabetes Care, Inc. is a medical device company dedicated to improving the lives of people with diabetes through relentless innovation and revolutionary customer experience. The Company takes an innovative, user-centric approach to the design, development and commercialization of products for people with diabetes who use insulin. Tandem manufactures and sells the t:slim X2 Insulin Pump, the only pump capable of remote feature updates using a personal computer, and the t:flex Insulin Pump, the first pump designed for people with greater insulin requirements. Tandem is based in San Diego, California.
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Tandem Diabetes Care, Inc., a medical device company, designs, develops, and commercializes various products for people with insulin-dependent diabetes in the United States. The company's flagship product is the t:slim X2 insulin delivery system that comprises t:slim X2 pump, its 300-unit disposable insulin cartridge, and an infusion set. It also provides t:flex insulin delivery system that includes t:flex pump, its 480-unit disposable insulin cartridge, and an infusion set; t:slim X2 with G5 integration; and Tandem Device Updater, a PC and Mac-compatible tool that allows users to update their pump's software. In addition, the company offers t:connect diabetes management application, a cloud-based data management application, which provides a visual way to display therapy management data from the pump and supported blood glucose meters for users, their caregivers, and their healthcare providers; t:lock cartridge and infusion set products; and various pump accessories. Its products in development include automated insulin delivery systems; t:slim X2 with Basal IQ; t:slim X2 with control IQ; t:sport insulin delivery system; and connected (mobile) health mobile application. The company was formerly known as Phluid Inc. and changed its name to Tandem Diabetes Care, Inc. in January 2008. Tandem Diabetes Care, Inc. was founded in 2006 and is headquartered in San Diego, California.
(Summary) (Company) (Chart)
20 May 2018
Price $12.83
1yr Target $7.64
Analysts 7
Dividend $0.00
Payout Ratio 0.00%

1yr Cap Gain %
Yield 0.00%
1yr Tot Return %

P/E ---
PEG ---
Beta -0.14


EPS (ttm) $-16.04
EPS next yr $-0.78
Forward P/E ---
EPS next 5yr 53.20%
1yr Price Support ---

Market Cap $522.44 Mil
Revenues $115.90 Mil
Earnings $-133.50 Mil
Profit Margin ---

Quick Ratio 2.00
Current Ratio 2.60
Debt/Equity 6.47


1yr RevGR 27.71%
3yr RevGR 29.01%
5yr RevGR ---

1yr EarnGR ---
3yr EarnGR ---
5yr EarnGR ---

1yr DivGR ---
3yr DivGR ---
5yr DivGR ---

ROA -76.80%
ROE 515.80%



​Tandem Diabetes Care is a medical device company with an innovative approach to the design, development and commercialization of products for people with insulin-dependent diabetes. Their competitive advantage lies in their unique consumer-focused approach, and the incorporation of modern and innovative technology into product offerings. Their manufacturing and sales activities primarily focus on their flagship product, the t:slim X2 Insulin Delivery System which is based on a proprietary technology platform. The t:slim X2 is the smallest durable insulin pump available, and the only pump currently available that is capable of remote feature updates, which positions the Company to address the evolving needs and preferences of differentiated segments of the insulin-dependent diabetes market. By delivering innovative hardware and software solutions, as well as best-in- class customer support, Tandem Diabetes Care aims to improve the lives of people with diabetes.

The Company has commercially launched five insulin pumps since inception, all of which have been developed using their proprietary technology platform. Two of these pumps have featured continuous glucose monitoring technology, or CGM. Since the launch of the first product in August 2012 through December 2017, the Company has shipped nearly 68,000 pumps to customers in the US. In 2017, they announced plans to begin commercialization of t:slim X2 in select countries outside the United States, including Canada, during 2018.

The Company began commercial sales of their first insulin pump, the t:slim Insulin Delivery System, in August 2012. During 2015, they began sales of two additional insulin pumps: the t:flex in May 2015 and the t:slim G4 in September 2015. In October 2016, they began sales of t:slim X2 and discontinued new sales of the t:slim. In September 2017, the Company began sales of the t:slim X2 integrated with the Dexcom G5 Mobile CGM system and discontinued new sales of t:slim G4. In 2017, t:slim X2 represented approximately 95% of the Company's new pump shipments. In September 2017, they also began sales of cartridge and infusion set products using the custom t:lock, which replaces the standard Luer-lok connector that historically joined an infusion set to the cartridge.

All people with type 1 diabetes require daily rapid-acting insulin, but only a subset of people with type 2 diabetes require daily rapid-acting insulin, as a majority manage their therapy through improvements in diet and exercise, oral medications, or injectable therapies such as long acting insulin. According to the CDC approximately 23 million people in the US had been  diagnosed with diabetes, of which type 1 diabetes accounts for approximately 5% to 10%. Of people with type 2 diabetes in the US, the CDC reports that approximately 14%, or 3.2 million people, manage their diabetes with insulin only. The International Diabetes Federation estimates that in 2017 approximately 425 million people had diabetes worldwide, of which approximately 10%, or 42.5 million, had type 1. Tandem Diabetes Care's target market consists of people in the US and select countries who require daily rapid- acting insulin.

The Company's insulin pump products are generally considered durable medical equipment, and have an expected lifespan of at least four years. In addition to selling insulin pumps, the Company sells disposable products that are used together with the pumps and replaced every few days, including cartridges for storing and delivering insulin, and infusion sets that connect the insulin pump to a user’s body. 

Each insulin pump is compatible with the Tandem Device Updater, a unique tool that allows pump users to update their pumps’ software quickly and easily from a personal computer. The Tandem Device Updater provides customers access to new and enhanced features and functionality faster than the industry has been able to do in the past. Its first cleared use by the FDA was to update t:slim pumps purchased before April 2015 to the latest software. In September 2017, the Company set a new standard of care by offering all existing t:slim X2 customers integration with the Dexcom G5 Mobile CGM system through a software update using the Tandem Device Updater. Within the first 30 days more than 30% of t:slim X2 customers who purchased their pump prior to its availability had updated their pump. By the end of 2017 more than 40% of t:slim X2 customers had updated their pump and now have access to Dexcom G5 Mobile CGM integration. In October 2017, the Company announced that they intend to make any new features approved by the FDA in 2018 available to all in-warranty users of t:slim X2 at no cost through the Tandem Device Updater. 

The Company has developed products to provide specific features people with insulin-dependent diabetes seek in a next-generation insulin pump. Use of modern consumer technologies, and a proprietary pumping technology, has allowed Tandem to design the slimmest and smallest durable insulin pump on the market, without sacrificing insulin capacity. Of the customers who converted from another manufacturers’ pump, the greatest percentage converted from Medtronic, followed by Animas. 

For the years ended December 31, 2017, 2016 and 2015, sales were $107.6 million, $84.2 million, and $72.9 million, respectively. For the years ended 2017, 2016 and 2015, net loss was $73.0 million, $83.4 million, and $72.4 million, respectively. For the year ended December 31, 2017, Tandem recorded $5.0 million with a corresponding increase in gross profit of $3.1 million as a result of the Company's Technology Upgrade Program. For the year ended December 31, 2016, they recorded net sales deferrals of $4.3 million and recognized an additional net cost of sales of $0.3 million as a result of the Technology Upgrade Program. Pump sales accounted for 66%, 74%, and 83% of sales, respectively, for the years ended December 31, 2017, 2016 and 2015, while pump-related supplies primarily accounted for the remainder in each year. Sales of accessories were not material in any of these periods. 


Tandem has rapidly increased sales since their commercial launch by expanding the sales, clinical and marketing infrastructure, by developing, commercializing and marketing multiple differentiated products that utilize our proprietary technology platform and consumer-focused approach, and by providing strong customer support. In their research, 86% of healthcare providers surveyed believe that providing great customer support is the most important attribute in an insulin pump manufacturer. Tandem believes that by demonstrating their product benefits and the shortcomings of existing insulin therapies, more people will choose their insulin pumps for their therapy needs, allowing Tandem to further penetrate and expand the market.
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My Perspective

These shares are now only about 1/20th of what they were a few years ago and normally that would not be the kind of company I'd look at. But this company has married technology and insulin pumps in a way that no other company is doing. They've also recently opened up a new manufacturing plant that has doubled their manufacturing capacity. To me that signals an aggressive attitude for the product and sales going forward -  both great news to an investor like me. 

The chart also looks like the shares bottomed at the beginning of the year and is now reversing higher on a significant volume increase. That also is confirmation that this move may be for real. My perspective is that this is the kind of company that belongs aside other companies in my portfolio. 

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Clearside Biomedical

5/22/2018

1 Comment

 
Clearside Biomedical, Inc., headquartered in Alpharetta, GA, is a publicly traded, ophthalmic biopharmaceutical company that envisions a world without blindness. Clearside relentlessly pursues transformative, elegant, precise solutions to restore and preserve vision. Clearside is developing advanced clinical and nonclinical candidates using a proprietary treatment approach offering unprecedented access to the back of the eye through the suprachoroidal space (SCS™). This offers potentially meaningful treatment benefits to patients suffering from sight threatening diseases like uveitis, retinal vein occlusion, diabetic macular edema and wet age-related macular degeneration.
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Clearside Biomedical, Inc.
, a late-stage clinical biopharmaceutical company, develops pharmacological therapies to treat blinding diseases of the eye. It is developing suprachoroidal injection of CLS-TA, a proprietary preservative-free formulation of the corticosteroid triamcinolone acetonide, which is in Phase III clinical trial for the treatment of macular edema associated with non-infectious uveitis; suprachoroidal injection of CLS-TA and a concomitant intravitreal injection of Eylea, an inhibitor of vascular endothelial growth factor that is in Phase III clinical trial to treat macular edema associated with retinal vein occlusion; and suprachoroidal injection of CLS-TA alone or together with intravitreal injection of Eylea that is in phase II clinical trial for diabetic macular edema. The company also engages in the development of therapies in various areas, such as gene therapy for inherited retinal disorders, neovascular age-related macular degeneration, and other ocular diseases. The company was founded in 2011 and is headquartered in Alpharetta, Georgia.
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Operational History

​Clearside Biomedical went public at $8.00 in June 2016 and entered a strong uptrend three months later, lifting vertically into an all-time high at $25.08 in October. It carved a double top pattern at that level and broke down in December, descending at the same trajectory as the prior uptick before bottoming out at just above $5.00 in March 2017. 

The stock ground sideways through the rest of the year and into 2018, testing last year's low in February. Support held into early March when it took off like a rocket in reaction to positive Phase III results for suprachoroidal CLS-TA, which treats macular edema. The uptick stalled and reversed at double top resistance in the low teens, while the pullback into this week has relinquished about four points. The March 5 breakaway gap between $7.90 and $10.00 should offer strong support, ahead of an uptrend that could reach the 2016 high.

On the heels of the Company's promising macular-edema treatment trial results, attention turns to whether the FDA will approve the marketing of CLS-TA and for what purposes. Clearside expects that it will submit a new drug application for CLS-TA to the regulatory agency in the fourth quarter of 2018, and it's also testing the drug as a treatment for macular edema associated with retinal occlusion and plans to report preliminary results from these trials in the same time window.

In March, the Company announced the pricing of its secondary public offering of 6,538,462 shares of its common stock at a price to the public of $13.00 per share. 
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My Path Forward

This company is in better shape than most biotechnology or biomedical companies because they've been successful in their phase III trials. That's a huge hurdle and produces a successful product. But that doesn't mean the FDA will allow it to be sold as a product nor does it identify what specific disease and treatment will be allowed. But the odds are higher than most simply because of the phase III success. 

I believe this product will be approved by the FDA but not until later this year and until that happens, there's always risk in accumulating these shares. My strategy will be to begin buying these shares very soon and at prices as close to $10 as I can. I believe that is where the support is. I will continue to buy up to about $13 because that's where the secondary was offered. At that point I'll have to make a decision on whether to continue buying. 

1 Comment

Vital Therapies

5/21/2018

0 Comments

 
Vital Therapies, Inc. is a clinical-stage biotechnology company focusing on the discovery, development and commercialization of cell-based therapies capable of transforming the management of life-threatening conditions. The Company's initial product candidate, the ELAD® System, or ELAD, is a human-cell-based, bio-artificial liver which is being developed to improve rates of survival among patients with acute forms of liver failure.
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The ELAD System are expected to improve rates of overall survival and transform the management of acute forms of liver failure. Therapy with ELAD consists of a single, up to five-day treatment session, during which a patient’s blood plasma is passed continuously through four cartridges containing approximately one pound of VTL C3A cells. These cells, which are grown by Vital Therapies from their proprietary cell banks, are human, liver-derived cells, which have been shown to retain a large number of the liver’s synthetic and metabolic functions. During therapy with the ELAD System, the VTL C3A cells infuse the patient’s plasma with beneficial proteins, including growth factors, cell survival proteins, and anti-inflammatory proteins, and also remove certain harmful substances, such as endotoxin, all of which may better allow the patient’s own liver to recover and regenerate, thereby potentially improving patient survival. The ELAD System has been granted orphan drug designation by the U.S. Food and Drug Administration, or FDA, and the European Commission, for the treatment of patients with acute liver failure, including alcoholic hepatitis. 

As part of ELAD’s clinical development program, over 250 subjects have received treatment with the ELAD System through prior clinical trials and a compassionate use program. Although VTI-208, our Phase 3 clinical trial evaluating ELAD in sAH, failed to reach either the primary or secondary endpoints, data from pre-specified and post-hoc analyses of this study has shown trends that may indicate a potential to increase survival rates in certain subsets of subjects with liver failure due to acute hepatocellular insult and alcohol use.

Based on our analysis of VTI-208 subsets, Vital Therapies is pursuing a new phase 3 clinical trial in sAH, referred to as VTL-308. VTL-308 is a phase 3 randomized, controlled, open-label trial, designed to evaluate the ELAD System in subjects with severe alcoholic hepatitis who meet criteria based on learnings from pre-specified and post-hoc analyses of the VTI-208 clinical trial. The Company enrolled the first subject in VTL-308 in May 2016 and expects data in third quarter 2018.


​Vital Therapies, Inc.
, a biotherapeutic company, focuses on developing and commercializing a cell-based therapy for the treatment of acute forms of liver failure in the United States. Its product candidate is the ELAD system, an extracorporeal human allogeneic cellular liver therapy that is in Phase III clinical trials helps in enhancing the rates of survival in patients with acute forms of liver failure. The company was formerly known as Vitagen Acquisition Corp. and changed its name to Vital Therapies, Inc. in June 2003. Vital Therapies, Inc. was founded in 2003 and is headquartered in San Diego, California.
​(Summary) (Company) (Chart)
20 May 2018
Price $6.40
1yr Target $9.00
Analysts 1
Dividend $0.00
Payout Ratio 0.00%

1yr Cap Gain 40.62%
Yield 0.00%
1yr Tot Return 40.62%

P/E ---
PEG ---
Beta 4.32
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EPS (ttm) $-1.32
EPS next yr $-1.25
Forward P/E ---
EPS next 5yr 15.50%
1yr Price Support ---

Market Cap $266.43 Bil
Revenues ---
Earnings $-52.10 Mil
Profit Margin ---

Quick Ratio 5.70
Current Ratio 5.70

Debt/Equity 0.00
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1yr RevGR ---
3yr RevGR ---
5yr RevGR ---

1yr EarnGR ---
3yr EarnGR ---
5yr EarnGR ---

1yr DivGR ---
3yr DivGR ---
5yr DivGR ---

ROA -65.10%

ROE -73.00%
My Path Forward

While I find most of my investments by scanning hundreds and thousands of companies every day and every week, I actually found this company while scanning options opportunities. And that's how I'm entering into this position. I'm selling options with the expectation of keeping the premiums and potentially owning these shares later this year. Based on my understanding of the future of the company, success or failure rests on this new phase III trial of the VTL-308. The trial will continue throughout the summer and is expected to announce results in September. Therefore that's where the risk to the shares elevates.

This third quarter risk of trial success or failure has caused the Sep Puts and Calls to elevate their amount of premium built into the options. So for me, this is all about the options. I believe, and it's only a belief, that while the company had very little success with VTL-208, they've gone through the data and now have a better idea of how to segment the population into that area that may benefit from VTL-308. So to me there should be an increased chance of this phase III trial being successful. So I'm willing to start a small position to see just how well these shares increase over the next four months. 

I am currently selling Puts and intend to buy shares in the near future. The expectation of a 40% return over the next 12 months is very appealing. Especially if I'm buying those shares with money received from selling options on these shares.

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Learning to Read the Market

5/16/2018

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Learning to be a good investor is learning how to read the market. It’s learning how to look at a chart and understand what the chart is trying to show you. A good investor doesn’t predict where the market is headed, he simply learns to visually read the chart and react to its movements. An investor cannot will the market to move in any direction he desires any more than a pilot can will the wind or a sailor can will the sea.  In the end the market is always right.

If I had only one thing to look at to determine the future direction of a stock’s price, I would want a chart that had only the daily closing prices over a period of time. That’s really not much to go on but if I held the chart out at arm’s length or farther, I could quickly grasp whether the stock was going up, down, or sideways. And I could trade on that information.

My success rate may not be outstanding but I could generally tell what the stock had been doing. If it was going up I would want to buy and if it was going down I would want to sell. This would be a rather crude trading strategy but it would still be better than having no strategy at all. Fortunately I have never had to trade under these types of conditions.


Beyond price, everything else found on a stock’s chart can only confirm or refute my interpretation of the direction of the stock’s price. The easiest to see and interpret would be a moving average indicator. Simply interpreted, if the stock was above the moving average I would consider buying the stock and if below I would consider selling the stock. Not a great Improvement but it is a giant leap over using only the stock’s price.

Multiple moving averages
 would be even better. Darryl Guppy, an Australian Investor and financial market educator, has written several books and operates the website guppytraders.com in which he discusses his method of investing using Multiple Moving Averages in order to make buy and sell decisions.

Beyond these I’d bring in Bollinger Bands, the MACD, the RSI (Relative Strength Index), Full Stochastics, and the ADX (Advance Decline Index). Occasionally I will look at others but by the time I look at these I’ve identified whether or not these momentum indicators and oscillators are telling the same story. If they all agree, I act. If they don’t, I move on to another candidate.

Once I’ve acted that’s when the real work starts. I then have to monitor that stock to ensure that the price continues to move in the direction that the chart was telling me and that the momentum indicators and oscillators continue to confirm. When they don’t, then the stock may be getting ready to reverse. If I’m in I may want to get out. If I’m out, I may want to get back in.


The one thing I have to be conscious of constantly is that the market will not go where I want it to go. It will go where the universe of investors push it. If I buy a stock and it goes against me, I have to exit immediately. I have to admit that my decision was wrong and I need to cut my losses before they get bigger.

​When an investor starts to think that he’s right and the market is wrong, it’s the beginning of the end for that investor. The market is neither right nor wrong. It’s simply the market. It’s just people making decisions and then acting on those decisions. And a good investor is one who learns how to look at the charts and understand what they are trying to tell him. And then take what the market is willing to give.


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Best Candidates for Selling Options

5/15/2018

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Sometimes the trade is buying and selling shares of a company, and sometimes the trade is selling the options associated with a company's stock. When its the options, shares of the company become the insurance for calls and cash becomes the insurance for puts. All of this is the reverse of scanning companies' stock charts for great options. It's a process of looking at option premiums first and then looking at the chart to insure it's in a channel with visual support and resistance levels. It's those levels that provide the information to determine which options to sell.

All of this may seem confusing but it's a similar process when looking for stock to swing trade. The difference is that swing trading involves only the support and resistance lines while this process of finding the best candidates for selling options also involve determining which options have large premiums. 

With practice, it becomes apparent that stock selection for swing trades, for long term holders that want to enhance their income, and for the sole purpose of option sales first, are intertwined and often just mirrors of each other. Perfecting one strategy can also perfect each of the others. 

Below are a few candidates with options that have large premiums. The thing to do now is to inspect the charts for limits of a trading range.
 
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0 Comments

Interesting Charts I'm Watching

5/14/2018

0 Comments

 
Creating a scan of the markets looking for companies that are pretty sound financially as well as having pretty good estimates forward produces a number of companies worth considering. It's the fundamentals and forward estimates that direct me toward those companies that are doing well from a business sense. But as all traders know, timing is everything. And that's where the charts come in. 

Here's a selection of charts of those companies that visually caught my eye based on a scan of fundamentals. None of these are recommendations but they are companies that are doing well and are expected to do well in the future AND appear to be timely for accumulation. I'll be watching this list over the next few weeks. Each of these may end up in my portfolio. 
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QuinStreet, Inc., an Internet performance marketing and media company, provides customer acquisition services for its clients in the United States and internationally. It offers online marketing services to its clients in the form of qualified leads, inquiries, clicks, calls, applications, customers, display advertisements, or impressions through its Websites or third-party publishers. The company provides its services in various verticals, such as financial services, education, business-to-business technology, and home services. QuinStreet, Inc. was founded in 1999 and is headquartered in Foster City, California.

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58.com Inc. operates online classifieds and listing platforms that enable local merchants and consumers to connect, share information, and conduct business in China. It primarily operates online multi-content category-classified advertising platforms under the 58 and Ganji names; and Anjuke, an online real estate listing platform. The company's platform contains local information of approximately 500 cities or towns in various content categories, including jobs, real estate, used goods, automotive, and yellow pages. It offers membership services, such as merchant certification and listing benefits, as well as display of online storefronts; and online marketing services comprising listing services, such as real-time bidding and priority listing, as well as marketing services through collaboration with third party Internet companies. 58.com Inc. was founded in 2005 and is headquartered in Beijing, the People's Republic of China.

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TAL Education Group, through its subsidiaries, provides K-12 after-school tutoring services in the People's Republic of China. It offers tutoring services to K-12 students covering various academic subjects, including mathematics, physics, chemistry, biology, history, geography, political science, English, and Chinese. The company also provides tutoring services primarily through small classes, including Xueersi Peiyou, Mobby, and Firstleap tutoring services; personalized premium services under Izhikang name; and online courses. In addition, it operates jzb.com, an online education platform that serves as a gateway to its online courses through xueersi.com and other Websites, which offer college entrance examinations, high school entrance examinations, graduate school entrance examinations, preschool education, Chinese composition, and raising infants and toddlers. Further, the company provides educational content through mobile applications; operates mmbang.com and the Mama Bang app, an online platform focusing on children, baby, and maternity market; and provides consulting services for overseas studies and test courses preparation under the Shunshun Liuxue name. Additionally, it offers tutoring services for students aged two through twelve under the Mobby brand; education and management consulting, and investment management and consulting services; and develops and sells software and networks, as well as offers related consulting services. As of February 28, 2017, the company's educational network included 507 learning centers and 401 service centers in 30 cities. TAL Education Group was founded in 2003 and is headquartered in Beijing, the People's Republic of China.
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World Wrestling Entertainment, Inc., an integrated media and entertainment company, engages in the sports entertainment business in North America, Europe, the Middle East, Africa, the Asia Pacific, and Latin America. The company operates through Network, Television, Home Entertainment, Digital Media, Live Events, Licensing, Venue Merchandise, WWEShop, and WWE Studios segments. It operates WWE Network, a live streaming network that offers pay-per-view events, original programming, and video-on-demand library; and produces television programming, reality shows, and other programming, as well as produces content via home entertainment platforms, including DVD, Blu-Ray, subscription, and transactional on-demand outlets. The company also offers broadband and mobile content through its Websites and third party Websites; produces live events; and licenses various WWE themed products, such as video games, toys, apparel, books, and music. In addition, it designs, sources, markets, and distributes various WWE-branded products, such as T-shirts, belts, caps, and other novelty items; operates WWEShop, an e-commerce storefront; and WWE Studios that produces and distributes filmed entertainment content, such as movies for theatrical, home entertainment, and/or television release. World Wrestling Entertainment, Inc. was founded in 1980 and is headquartered in Stamford, Connecticut.
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Bio-Rad Laboratories, Inc. manufactures and supplies products and systems to separate complex chemical and biological materials, as well as to identify, analyze, and purify components for life science research, healthcare, analytical chemistry, and other markets. The company operates through two segments, Life Science and Clinical Diagnostics. The Life Science segment develops, manufactures, and markets a range of reagents, apparatus, and laboratory instruments that are used in research techniques, biopharmaceutical production processes, and food testing regimes. It focuses on selected segments of the life sciences market in proteomics, genomics, biopharmaceutical production, cell biology, and food safety. This segment serves universities and medical schools, industrial research organizations, government agencies, pharmaceutical manufacturers, biotechnology researchers, food producers, and food testing laboratories. The Clinical Diagnostics segment designs, manufactures, sells, and supports test systems, informatics systems, test kits, and specialized quality controls that serve clinical laboratories in the diagnostics market. Its products include reagents, instruments, and software which address specific niches within the in vitro diagnostics (IVD) test market. This segment sells its products to reference laboratories, hospital laboratories, state newborn screening facilities, physicians' office laboratories, transfusion laboratories, and insurance and forensic testing laboratories. The company offers its products through its direct sales force, as well as through distributors, agents, brokers, and resellers. It operates in Europe, Pacific Rim, the United States, and internationally. Bio-Rad Laboratories, Inc. was founded in 1952 and is headquartered in Hercules, California.
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TPI Composites, Inc. manufactures and sells composite wind blades, and related precision molding and assembly systems to original equipment manufacturers. The company also provides composite solutions for the transportation industry. It operates in the United States, Asia, Mexico, Europe, the Middle East, and Africa. The company was formerly known as LCSI Holding, Inc. and changed its name to TPI Composites, Inc. in 2008. TPI Composites, Inc. was founded in 1968 and is headquartered in Scottsdale, Arizona.
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Supernus Pharmaceuticals, Inc., a specialty pharmaceutical company, focuses on the development and commercialization of products for the treatment of central nervous system diseases in the United States. It offers Oxtellar XR, an extended-release oxcarbazepine for use in the treatment of epilepsy; and Trokendi XR, an extended-release topiramate, which is used for the treatment of epilepsy. The company's product candidates comprise SPN-810, a molindone hydrochloride that is in Phase III clinical trial for the treatment of impulsive aggression in patients with attention deficit hyperactivity disorder (ADHD); and SPN-812, a viloxazine hydrochloride, which is in Phase III clinical trial that is used for the treatment of ADHD. It also develops SPN-809, a viloxazine hydrochloride, which is in Phase II ready clinical trial for the treatment of depression. The company markets its products through wholesalers and pharmaceutical distributors. Supernus Pharmaceuticals, Inc. was founded in 2005 and is based in Rockville, Maryland.
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IAMGOLD Corporation explores for, develops, and operates gold mining properties in North and South America, and West Africa. It also explores for copper and silver. The company owns interests in the Rosebel gold mine located in north eastern Suriname, South America; the Essakane gold mine in north-eastern Burkina Faso, West Africa; the Westwood gold mine in southwestern Quebec, Canada; and the Sadiola Gold Mine located in southwest Mali, West Africa. It holds interests in various other projects, including the Boto gold project in Senegal; the Pitangui project in Brazil; the Siribaya project in Mali; the Loma Larga project in southern Ecuador; and the Eastern Borosi project in Northeast Nicaragua. IAMGOLD Corporation was incorporated in 1990 and is headquartered in Toronto, Canada.
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AAR CORP. provides products and services to commercial aviation, government, and defense markets worldwide. The company's Aviation Services segment offers aftermarket support and services; inventory management and distribution services; and maintenance, repair, and overhaul, as well as engineering services. This segment also sells and leases new, overhauled, and repaired engine and airframe parts and components; and provides inventory and repair programs, warranty claim management, and outsourcing programs for engine and airframe parts and components, as well as performance-based logistics programs in support of the U.S. Department of Defense (DoD) and foreign governments. In addition, it offers airframe inspection, maintenance, repair and overhaul, painting, line maintenance, airframe modification, structural repair, avionic and installation, exterior and interior refurbishment, and engineering and support services; repairs and overhauls landing gears, wheels, and brakes; and sells and leases used commercial aircraft. The company's Expeditionary Services segment provides products and services supporting the movement of equipment and personnel by the U.S. DoD, foreign governments, and non-governmental organizations. Its expeditionary airlift services offer fixed- and rotary-wing flight operations, such as search and rescue operations, and transporting personnel and cargo. This segment also designs, manufactures, and repairs transportation pallets, and various containers and shelters, as well as composite materials for commercial, business, and military aircraft; and provides engineering, design, and system integration services for command and control systems. The company primarily markets and sells products and services through its employees and foreign sales representatives. As of May 31, 2017, its portfolio consisted of two aircraft owned through joint ventures. AAR CORP. was founded in 1951 and is headquartered in Wood Dale, Illinois.
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CryoLife, Inc., together with its subsidiaries, manufactures, processes, and distributes medical devices and implantable human tissues for use in cardiac and vascular surgeries worldwide. The company operates in two segments, Medical Devices and Preservation Services. It offers BioGlue, an agent for cross-linking proteins for cardiac, vascular, pulmonary, and general surgical applications; On-X mechanical heart valves for aortic and mitral indications; cardiac preservation services; PhotoFix, a bovine pericardial patch for use in cardiac and vascular repairing activities; and PerClot, an absorbable powdered hemostat for use in surgical procedures, including cardiac, vascular, orthopedic, neurological, gynecological, ENT, and trauma surgeries. The company also provides cardiac laser therapy products, which include laser consoles, related service and maintenance, and single-use, as well as fiber-optic hand-pieces for the treatment of coronary artery disease in patients with severe angina. In addition, it distributes E-vita OPEN PLUS, a hybrid stent graft systems for the surgical and endovascular treatment; E-xtra DESIGN ENGINEERING products for the treatment of aortic vascular diseases; E-ventus BX, a balloon-expandable peripheral stent graft for the endovascular treatment of renal and pelvic arteries; E-liac, a stent graft used to treat aneurysmal iliac arteries, as well as aneurysmal iliac side branches; E-vita THORACIC 3G is a stent graft system for the endovascular treatment of thoracic aortic aneurysms; and E-tegra, an abdominal aortic aneurysms stent graft system for the endovascular treatment. Further, the company offers vascular preservation services; and synthetic vascular grafts for use in open aortic and peripheral vascular surgical procedures. The company serves physicians, hospitals, and other healthcare industries, as well as cardiac, vascular, thoracic, and general surgeons. CryoLife, Inc. was founded in 1984 and is headquartered in Kennesaw, Georgia.
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Axon Enterprise, Inc. develops, manufactures, and sells conducted electrical weapons (CEWs) worldwide. The company operates through two segments, TASER Weapons, and Software and Sensors. It offers TASER X26P and TASER X2 smart weapons for law enforcement; consumer CEWs; and replacement cartridges and consumables, as well as performance power magazines. The company also provides Axon Body 2; Axon Flex 2 that builds upon the Axon Flex camera system; Axon Fleet, an in-car video system; Axon Dock, a camera charging station; TASER Cam HD, a recording device; Axon Signal, a technology; and Signal Sidearm, a device compatible with firearm holsters. In addition, it offers Evidence.com, a cloud-based digital evidence management system that allows agencies to store data and enables new workflows for managing and sharing that data; Evidence Sync, a desktop-based application that enables evidence to be uploaded to Evidence.com; and Commander, an on-premise application that consolidates customer's digital evidence in one secure location. Further, the company provides Axon Citizen, a mobile application that offers a public safety portal, where community members can submit photos and videos of an incident; Axon Capture, a mobile application to allow officers to capture digital evidence from the field; Axon View, a mobile application to provide instant playback of unfolding events; and Axon Interview, a recording system designed for the interview room. Axon Enterprise, Inc. sells its products to military forces, private security, correctional facilities, and consumer personal protection markets, as well as to federal, state, and local law enforcement agencies through its direct sales force, distribution partners, online store, and third-party resellers. The company was formerly known as TASER International, Inc. and changed its name to Axon Enterprise, Inc. in April 2017. Axon Enterprise, Inc. was founded in 1993 and is headquartered in Scottsdale, Arizona.
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AeroVironment, Inc. designs, develops, produces, supports, and operates unmanned aircraft systems (UAS) and efficient energy systems (EES) in the United States and internationally. The company offers small UAS products to deliver intelligence, surveillance, and reconnaissance; and communications, such as real-time tactical reconnaissance, tracking, combat assessment, and geographic data to the small tactical unit or individual operator. Its small UAS wirelessly transmit critical live video and other information to a hand-held ground control unit enabling the operator to view and capture images; ground control systems allow the operator to control the aircraft; and tactical missile systems designed to be reusable for various flights and to be recovered through an autonomous landing feature that enables a controlled descent to a designated location. The company also provides spare equipment, alternative payload modules, batteries, and chargers; repair, refurbishment and replacement, training, and customer support services to small UAS; turnkey information solutions; and engineering services. In addition, it offers electric vehicle charging systems, services, and related solutions for plug-in passenger vehicles; PosiCharge industrial electric vehicle charging systems for electric material handling vehicles and airport ground support equipment; and power cycling and test systems for developers and manufacturers of electric vehicles, as well as battery packs, electric motors, and fuel cells. The company sells EES products directly through sales force; and through retailers, resellers, industrial battery and lift-truck dealers, and distributors and representatives. It serves the U.S. Department of Defense, including the U.S. Army, Marine Corps, Special Operations Command, Air Force, and Navy, as well as commercial, consumer, and government customers. The company was founded in 1971 and is headquartered in Monrovia, California.
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Chart Industries, Inc. manufactures and sells engineered equipment, packaged solutions, and value-add services for the industrial gas, energy, and biomedical industries worldwide. It operates in three segments: Energy & Chemicals (E&C), Distribution & Storage (D&S), and BioMedical. The E&C segment primarily provides brazed aluminum heat exchangers, Core-in-Kettle heat exchangers, air cooled heat exchangers, cold boxes, and process systems, as well as axial cooling fans for power, heating, ventilation, air conditioning, and refining end user applications. The D&S segment designs, manufactures, installs, services, and maintains bulk and packaged gas cryogenic solutions for the storage, distribution, vaporization, and application of industrial gases; and offer cryogenic components, including vacuum insulated pipes, engineered bulk gas installations, specialty liquid nitrogen, end-use equipment, and cryogenic flow meters. This segment also supplies cryogenic trailers, ISO containers, railcars, bulk storage tanks, fuel stations, loading facilities, and regasification equipment for delivering LNG into virtual pipeline applications; and large vacuum insulated storage tanks as equipment for purchasers of standard liquefaction plants. The BioMedical segment offers respiratory oxygen product line that comprises medical respiratory products, including liquid oxygen systems, as well as stationary, transportable, and portable oxygen concentrators primarily used for the in-home supplemental oxygen treatment of patients with chronic obstructive pulmonary diseases, such as bronchitis, emphysema, and asthma. This segment also provides vacuum insulated containment vessels for storing biological materials; and on-site generation products that consist of self-contained and standard generators, and packaged systems for industrial and medical oxygen and nitrogen generating systems. The company was incorporated in 1992 and is headquartered in Ball Ground, Georgia.
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TETRA Technologies, Inc., together with its subsidiaries, operates as a diversified oil and gas services company. The company's Fluids division manufactures and markets clear brine fluids, additives, and associated products and services to the oil and gas industry for use in well drilling, completion, and workover operations in the United States, as well as in Latin America, Europe, Asia, the Middle East, and Africa. This division also markets liquid and dry calcium chloride products; and provides water management services for onshore oil and gas operators. Its Production Testing division provides frac flowback, production well testing, offshore rig cooling, and other associated services in oil and gas producing regions in the United States, Mexico, and Canada, as well as in various basins in South America, Africa, Europe, the Middle East, and Australia. The company's Compression division engages in the fabrication and sale of standard compressor packages, custom-designed compressor packages, and oilfield pump systems; and the provision of compressor package reconfiguration and maintenance services, and compressor package parts and components manufactured by third-party suppliers. This division provides compression services and equipment for natural gas and oil exploration and production, midstream, transmission, and storage companies operating throughout in onshore producing regions of the United States, as well as in Mexico, Canada, and Argentina. TETRA Technologies, Inc. was founded in 1981 and is headquartered in The Woodlands, Texas.
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Nine Companies Channeling Higher

5/8/2018

1 Comment

 
Shares of companies that move higher on increased volume tend to bring in more volume that often pushes the shares even higher. It's an example of crowd behavior and the illusion that someone knows something more than someone else and therefore needs to be followed.

These companies are easy to find with a decent screener, but it's a rather simplistic method of finding companies to invest in. It's just the first step in finding great companies. Once a list is created, further research need to occur into the fundamentals and technicals surrounding the shares. 

Below is a list of nine companies that are moving upward along a very easily defined channel. They're each good candidates for further research to see if this upward movement will continue. A simple look at the chart shows that they're most likely to continue higher but as everyone knows, there's no guarantee in the stock market. 

If you're looking for new ideas, these nine companies may just be a great place to start.
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1 Comment

The Fallacy of the B-School Degree

5/7/2018

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Stock charts are historical records of human behavior and are beautiful works of art to someone who has studied human behavior (I have my Master’s Degree in Social Psychology from NC State University). Those charts are the visual end result of the human decision making process. If we can discover the reasoning behind those decisions and act upon that knowledge in a timely fashion, the American Dream is within our grasp. 

Every stock price quote has both a bid and an ask price rather than one single price. There's someone who is actually bidding the bid price and someone else who is actually asking the ask price. The price you see when you look up the price of a stock is really the price that was transacted on the last trade, not the current bid and ask price. In order for that last trade to have occurred, there had to have been an agreement on price between a buyer and seller. If buyers are locked at the bid price and sellers are locked at the asking price, then trades would never occur. And if no trade ever occurred, there would be no volume in that stock. The act of trading is what creates volume.

Seeing the volume charted along with the stock’s price provides me with a clue in determining the amount and direction of the activity occurring in the stock. Another clue is knowing what the average volume is for a given day so I can know if today’s trading volume is above or below that daily average. Since I know that trading creates volume and volume only occurs when one of the traders breaches the spread between the bid and ask, I know that someone had to have flinched. As the trading volume increases I am seeing an increasing number of people who are flinching and completing the trade. 

If volume starts to increase and the price starts to rise, I’m seeing buyers cross the spread and bid the stock higher. If volume starts to increase and the price starts to fall, I’m seeing sellers cross the spread and push the stock lower. Regardless of why these traders are creating volume and pushing the price higher or lower is something I may never know but I can visibly see what they are doing right there in the chart. I can see people act upon decisions they have made right there on the chart in real time. And the more volume I see tells me that an increasing number of traders are coming to the same decision and acting on that decision by trading the stock. Charts are a fascinating view on the decisions and behavioral patterns of stock traders. 

Remember how all your life you were told to be a leader and not a follower? In the stock market being a leader is the quickest way to bankruptcy. At some point I’ll write more about the concept of trend following but for now the idea is to figure out which way the price and volume are moving and trade in that direction. If traders are pushing a stock higher I want to be long that stock and if traders are pushing a stock lower I want to be short that stock. I really don’t want to be on the wrong side of a trade. That’s detrimental to my financial health.

I can and have traded successfully throughout my career using only price and volume as indicators. But I’ve done this only when no other indicators were available. Today there are so many additional indicators that I can use to confirm my trading decisions that I rarely trade using only these two things - price and volume. Today I use momentum indicators and oscillators to confirm my trading decisions. I have my favorites and they’re wonderful tools to increase my probability of success and I’ll explain the ones I use in a future post. 
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Aquinox Pharmaceuticals

5/2/2018

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Aquinox Pharmaceuticals is a clinical-stage pharmaceutical company developing novel therapeutics for chronic urological conditions marked by inflammation and pain. Their lead drug candidate, rosiptor, is in Phase 3 development for the treatment of patients with interstitial cystitis/bladder pain syndrome (IC/BPS), a condition for which there are currently few FDA approved and/or effective treatment options. The Company is focused on leveraging their library of novel compounds that activate SHIP1 (SH2-containing inositol-5’-phosphatase 1) to develop therapeutics for application in inflammation, inflammatory pain, and blood cancers.

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​Aquinox Pharmaceuticals, Inc., a clinical stage pharmaceutical company, engages in developing novel therapeutics for chronic urological conditions by inflammation and pain. The company focuses on a library of novel compounds that activate SH2-containing inositol-5'-phosphatase 1 (SHIP1) to develop therapeutics for application in inflammation, inflammatory pain, and blood cancers. Its lead product candidate is Rosiptor (Leadership 301), a small molecule activator of SHIP1 that is in Phase III clinical trials for treatment in interstitial cystitis/bladder pain syndrome. The company was formerly known as Aquinox Pharmaceuticals (USA) Inc. and changed its name to Aquinox Pharmaceuticals, Inc. in January 2014. Aquinox Pharmaceuticals, Inc. was founded in 2003 and is headquartered in Vancouver, Canada.
(Summary) (Company) (Chart)
30 April 2018
Price $12.19
1yr Target $25.25
Analysts 4
Dividend $0.00
Payout Ratio 0.00%

1yr Cap Gain 107.13%
Yield 0.00%
1yr Tot Return 107.13%

P/E ---
PEG ---
Beta ---
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EPS (ttm) $-2.24
EPS next yr $-2.10
Forward P/E ---
EPS next 5yr ---
1yr Price Support ---

Market Cap $304.38 Mil
Revenues ---
Earnings $-52.50 Mil
Profit Margin ---

Quick Ratio 9.90
Current Ratio 9.90
Debt/Equity 0.00


1yr RevGR ---
3yr RevGR ---
5yr RevGR ---

1yr EarnGR ---
3yr EarnGR ---
5yr EarnGR ---

1yr DivGR ---
3yr DivGR ---
5yr DivGR ---

ROA -39.50%
ROE -42.30%


Rosiptor is a first-in-class, once-daily, oral treatment being studied for its effects on inflammation and inflammatory pain. Rosiptor has a novel mechanism of action, activating SHIP1, an enzyme that serves to down-regulate inflammation through its role in the PI3K signaling pathway. Rosiptor has been generally well tolerated in multiple completed clinical studies, with more than 395 subjects dosed. Aquinox retains full worldwide rights of rosiptor and hold patents with terms through 2024 in Europe and 2028 in the United States with the possibility of further patent term extension avenues available to us.
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IC/BPS is a debilitating condition marked by chronic bladder pain and urinary symptoms. Patients may experience recurring pain, pressure, and/or discomfort perceived to be related to the urinary bladder as well as urinary frequency, urgency, and/or nocturia. The pain often worsens upon bladder filling and may be relieved upon bladder emptying. Many patients living with IC/BPS report that it takes a physical, emotional, and psychological toll, greatly impacting employment and social and intimate relationships. There are currently few FDA approved and/or effective treatment options for IC/BPS. Only about 1 million of the 5.5 million adults in the United States with symptoms of IC/BPS have been diagnosed or are receiving treatment.
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SHIP1 and the P13K Pathway

The PI3K pathway is a cellular signaling pathway that has been linked to a diverse group of cellular functions and biological processes such as cell activation and migration, which are related to inflammation, and cell growth, proliferation and survival, which are related to cancer. As a result, the PI3K pathway is being evaluated by the academic community as well as by pharmaceutical and biotechnology companies in the areas of immune disorders and oncology.


In the PI3K pathway, the key messenger molecule is phosphatidylinositiol-3,4,5-trisphosphate, or PIP3, which initiates the signaling pathway. In cells derived from bone marrow tissues (e.g. immune cells), key enzymes that control levels of PIP3 are the PI3 kinase, or PI3K, and the phosphatases, phosphatase and tensin homolog, or PTEN, and SH2-containing inositol-5’-phosphatase 1, or SHIP1. PI3K generates PIP3, thus initiating the signaling pathway. This signaling is reduced by degradation of PIP3 by PTEN and SHIP1. PTEN is generally considered to be constantly working in the pathway to control basal activity, whereas SHIP1 is engaged when the cell is stimulated. In preclinical studies, PTEN has been shown to suppress cancer by controlling cell proliferation, whereas SHIP1, has been demonstrated to control inflammation by reducing cell migration and activation.

If the PI3K pathway is overactive, immune cells can produce an abundance of pro-inflammatory signaling molecules and migrate to and concentrate in tissues, resulting in excessive or chronic inflammation. SHIP1 is predominantly expressed in cells derived from bone marrow tissues, which are mainly immune cells. Consequently, drugs that activate SHIP1 can reduce the function and migration of immune cells and have an anti-inflammatory effect.

SHIP1 as a Drug Target

Aquinox believes that inflammation can be reduced by activation of SHIP1, taking advantage of the natural modulation of the PI3K pathway. When activated, SHIP1 redirects signaling in immune cells to reduce their activation and migration, thereby reducing inflammation while still allowing these cells to maintain cell growth and survival. The Company's scientific founders, based at the University of British Columbia, were the first to discover SHIP1 and show that small molecules could activate it, thereby making it a potential target for a new class of anti-inflammatory drugs. Additionally, other academic scientists have shown that certain immune cell cancers have suppressed levels of SHIP1, making such cancers also potential targets for SHIP1 activators. SHIP1 is predominantly present in immune cells. Therefore, SHIP1 activators target immune cells to cause an anti-inflammatory effect while minimizing effects in other tissues.

Rosiptor

Rosiptor is a SHIP1 activator that has demonstrated preliminary safety, broad anti-inflammatory potential and favorable drug properties in multiple preclinical studies. The Company has also completed eight clinical trials, exposing over 395 subjects to once daily oral administration of rosiptor. These trials have demonstrated that rosiptor is generally well-tolerated, with over 200 subjects receiving rosiptor in two Phase 2 trials for periods of 12 weeks. Aquinox believes rosiptor is the only SHIP1 activator currently in clinical trials and that no SHIP1 activator has yet received marketing approval as a treatment for disease in humans.

Rosiptor has Desirable Pharmaceutical Properties

In addition to demonstrating strong in vitro and in vivo activity, rosiptor was also selected as a lead candidate based on its many desirable pharmaceutical properties. It is highly water-soluble and does not require complex formulation for oral administration. Rosiptor has low plasma protein binding, is not appreciably metabolized in vitro and is excreted primarily as parent compound in both urine and feces. In humans, rosiptor has shown pharmacokinetic properties suitable for once-a-day oral dosing. In addition, the absorption of the drug candidate is equivalent whether taken with or without food.

Interstitial Cystitis/Bladder Pain Syndrome

IC/BPS is a chronic urinary bladder disease characterized by erosion of the interior bladder lining and chronic inflammation of the bladder wall, bladder and pelvic pain and increased urinary urgency and/or frequency. Stress or a change in diet has been known to trigger IC/BPS symptoms. IC/BPS affects men and women of all ages. Only approximately one million of the five and a half million adults in the United States with symptoms of IC/BPS have been diagnosed or are receiving treatment. IC/BPS is considered to be one of the most challenging urological conditions without effective therapy.

Chronic inflammation within the bladder wall can lead to damage and fibrotic changes in the bladder. There have been several studies linking allergic sensitivity to worsening IC/BPS symptoms. Furthermore, the inflammation leads to the release of mediators that irritate and trigger surrounding nerve tissue and causes radiating pain. For many IC/BPS sufferers, their symptoms of pain and urinary frequency are severe and adversely affect all major aspects of their lives, including overall physical and emotional health, employment, social and intimate relationships, and leisure activities.

The diagnosis of IC/BPS is often challenging and is based on exclusion of other diseases, including bladder cancer, kidney stones, vaginitis, endometriosis, sexually transmitted diseases and prostate infections. Currently, IC/BPS is more commonly diagnosed in women than men. Sometimes patients have to see a number of doctors and specialists over a period of several years to obtain a correct diagnosis. The reported diagnosis rate for IC/BPS is significantly lower than the number of people estimated to suffer from IC/BPS.

IC/BPS Current Therapies

There is no known cure for IC/BPS, although a number of therapies have been reported to relieve symptoms. The only FDA approved oral therapy is an agent, pentosan polysulfate sodium (PPS) (Elmiron), first approved in 1996, which may help to temporarily restore the bladder lining but can take up to six months before any benefit is noted. Recent placebo controlled studies of PPS however have failed to demonstrate benefit. Other oral therapies used off-label include antihistamines, anticholinergics, antispasmodics, anti-infectives, analgesics and low dose antidepressants to block neurogenic pain. Many IC/BPS patients continue to suffer this debilitating condition, despite treatment with existing therapies.

In addition to oral therapies, direct instillation of drugs into the bladder via catheter (intravesical therapy) has been shown to provide temporary relief of symptoms. Dimethylsulfoxide (DMSO; RIMSO-50) is the only drug approved by the FDA for bladder instillation for IC/BPS. It offers anti-inflammatory, muscle relaxant and analgesic effects. DMSO is used alone or in combination with heparin, corticosteroids, bicarbonate and a local anesthetic (lidocaine) for intravesical administration. Instillations and cystoscopy with hydrodistension along with analgesics and pain medications are treatments used in Japan and certain European countries.

Instillation therapies are invasive and can be inconvenient. Oral therapies can offer significant potential advantages for IC/BPS patients. However, despite precedents for IC/BPS anti-inflammatory therapies, there are no satisfactory oral therapies currently available. We believe there is a significant medical need for new and innovative treatments that target the underlying inflammatory disease process.

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​My Path Forward


As with all clinical stage pharmaceutical companies, an investment in stock is an investment in the companies ability to complete successfully the clinical trials and the commercialization of a product. That process entails a lot of risk so these shares should be accumulated with funds that may fall in value. But if successful, investors will rush to the shares of the company propelling it higher. Therein lies the reward. 

My strategy will be to accumulate shares of this company while simultaneously selling covered calls. This obviously caps my potential gain at the benefit of lowering my costs. It's a tradeoff I'm willing to make to reduce the risk involved in owning these shares. The risk has also expanded the option premiums so selling OTM calls well above the current price will allow price appreciation while at the same time still reducing the current investment. 

My expectation is that the shares will be at or below the strike price at expiration yet sufficiently high enough that my investment was maintained or increased. Hopefully these shares will meet these expectations. 

0 Comments

Sell in May and Go Away?

5/1/2018

0 Comments

 
We’ll all be hearing this phrase a lot over this next month as well as throughout the entire summer if the market retreats during this period. It’s a well-known trading adage attributed to that famous author “Anonymous”. The entire quote is actually “Sell in May and go away, don’t come back 'til St. Leger day”. Unfortunately hardly anyone in the US knows when, or even what, St Leger day is. It’s the day that a very special horse race occurs in the United Kingdom and it's considered part of England's “Triple Crown” of races. The race is run on the second Saturday in September so it actually occurs on a different day each year.

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​The intent of the phrase is to warn all investors to sell all their securities in May and avoid the seasonal decline that often occurs during the long summer months. The idea is that by doing this an investor would be much better off than staying in equities throughout the entire year.


This strategy is based on the historical performance of securities during the May to September timeframe. According to the Stock Trader's Almanac, since 1950, the Dow Jones Industrial Average has had an average return of only 0.3% during the May-October period, compared with an average gain of 7.5% during the November-April period.

While no one knows exactly why this seasonal trading pattern occurs, it’s assumed that lower trading volumes that usually occur during the summer vacations is the reason for the discrepancy in performance during this period.


As for me, I’m not going anywhere.

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    I am an Individual Investor with specific interest in long term growth and then enhancing my returns with income from dividends and derivatives. I don't recommend stocks to anyone (it's a good way to lose friends) and no one reading this should misinterpret my blog as a recommendation for any type of investment. I am writing this solely for myself and my kids.


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