Companies featured in this edition of the newsletter: ACTC, CVM, ENZ, HYTM, IMUC, IWEB, NXOI, ONBI, PSID, SIHI, XSNX
Markets hit fresh highs for ‘09 yet again this week, as decreased concerns regarding the Dubai debt restructuring announcement and news that the US labor market is showing signs of recovery spurred broad based buying which led all of the major indices higher. All told, the Dow ended the week up 0.8%, gaining 79 points to close at 10388, extending its yearly gains to 18.4%. The Nasdaq gained 2.6% on the week, closing at 2194, up 39.1% on the year, while the S&P 500 and Russell 2000 gained 1.3% and 4.4% respectively, bringing their YTD gains to 22.4% and 20.7%.
Concerns stemming from the post-Thanksgiving announcement that Dubai was attempting to restructure debt subsided early in the week, as investors recognized that US exposure to the debt was minimal, and developments would be ongoing for some time. With these fears allayed, investors focused in on economic news in the absence of any market moving earnings releases, and were not disappointed, as the seemingly endless streak of negative headlines associated with US labor markets was finally snapped when unequivocally upbeat employment reports were released late in the week. Employers shed only 11,000 jobs during the month of November, handily beating estimates calling for 125,000 cuts and marking the labor market’s best performance since December of 2007. Unemployment figures also dropped unexpectedly, declining to 10.0% in November from 10.2% the prior month.
In corporate news, Bank of America announced plans to repay $45 billion in TARP funds which sparked buying in financials and helped the sector to a 2.3% gain on the week, while gold continued its run, hitting a new high at $1226 per ounce before losing 4.6% on Friday to close at $1161 an ounce. Following the week’s activities, nine of the ten sectors comprising the S&P 500 finished the week in positive territory, lead by utilities at 3.9% and telecom at 2.4%.
What should investors look for this week? Earnings reports will continue to trickle in slowly; expect results from AutoZone (NYSE: AZO) and supermarket operator Kroger (NYSE: KR) Tuesday before the bell, followed by Costco (NASDAQ: COST) pre-market on Thursday.
Economic releases for the week begin on Monday with Consumer Credit for October due out at 2:00pm, followed on Wednesday by Wholesale Inventories for October at 10:00am and weekly crude inventories at 10:30am. On Thursday, expect weekly initial jobless and continuing claims at 8:30am, along with Trade Balance data for October. The week wraps up on Friday with Import and Export Prices for November, released along with Retail Sales for November at 8:30am, followed at 9:55am by Preliminary Michigan Sentiment for December and October Business Inventories at 10:00am.
Conference schedules will be busy again this week, beginning on Monday with the three-day UBS Media & Communications Conference in New York. On Tuesday, RBC Capital Markets hosts their Software-as-a Service One on One Symposium in New York, alongside the two day Bank of America Securities and Merrill Lynch Industrials Conference and Goldman Sachs US Financial Services Conference, both of which are also being held in New York; also beginning on Tuesday is the three day Barclay’s Technology Conference, being held in San Francisco. The week wraps up on Wednesday with Wells Fargo hosting their Global Real Estate Securities Conference in New York.
Earnings Preview: Enzo Biochem (NYSE: ENZ), a vertically integrated biotechnology company engaged in the research, development, manufacture, licensing and marketing of innovative health care products, technologies and services based on molecular and cellular techniques, is set to release results for its first fiscal quarter of 2010, for the period ended October 31, 2009, on Thursday after the close; the company will hold a conference call on Friday to discuss the results. During the fourth quarter of ‘09, Enzo reported a 16% increase in total operating revenue, to $24.5 million, and a 19% increase in gross profit, to $10.6 million, compared to the corresponding year ago period. The increased results were attributed to greater product sales and acquisitions at its Enzo Life Sciences subsidiary, in addition to higher testing throughput at its Enzo Clinical Labs division, but were offset by higher selling, general and administrative expenses amounting to 48% of net operating revenues. As a result of the widened costs, ENZ reported a net loss of $5.3 million or ($0.14) per share for the period, compared to a year ago net loss of $3.3 million, or ($0.09) per share; investors are likely to focus on the company’s ability to narrow net loss and continue to grow revenue from its Life Sciences and Clinical Labs divisions, which has recently expanded service offerings and product lines to include several new testing kits and diagnostic tools designed to expand marketability. Shares jumped over 14% on the week, gaining 75 cents to close at $5.91.
Hythiam (NASDAQ: HYTM), a company providing behavioral health management services to health plans, employers and unions through a network of licensed and company managed healthcare providers, announced last week that it has been granted eligibility to continue listing on the Nasdaq Exchange subject to HYTM’s ability to meet certain requirements. Continued listing is subject to the company’s ability to demonstrate either stockholders’ equity of at least $10 million or a market value of its listed securities of at least $50 million, on or before February 24, 2010. Shares lost six cents on the week to close at $0.30.
PositiveID Corp. (NASDAQ: PSID) , a provider of unique health and security identification tools to protect consumers and businesses, announced last week that it has entered into a strategic alliance with Innovations Avocare to develop PositiveID’s Health Link personal health record within the medical facilities participating in the State of Florida regional health information organizations (RHIO). The companies will also work to advance compatibility between their Health Link system and the state Electronic Medical Record systems utilized by RHIOs. Avocare connects healthcare within a community through the Regional Health Information Networks, a hardware and software system that brings medical information together through a secure Physicians Portal website dedicated to offering a more efficient, private and secure replacement to paper, fax and phone communications between health care providers. In other news last week, PSID announced its intention to expand its exclusive license agreement with partner RECEPTORS, to include Patent No. 7,504,364 titled “Methods of Making Arrays and Artificial Receptors” and Patent No. 7,469,076 “Sensors Employing Combinatorial Artificial Receptors,” to use in conjunction with PositiveID’s Patent No. 7,125,382 entitled “Embedded Bio-Sensor SystemÃ¢â‚¬ to develop an in vivo glucose-sensing radio frequency microchip for animals, primarily dogs and cats. Shares lost 4 cents on the week to close at $1.17.
CEL-SCI Corporation (AMEX: CVM), a developer of vaccines for the prevention and treatment of infectious diseases and a late-stage oncology company, announced last week that it has retained the services of an international Contract Research Organization (CRO) to run its upcoming Phase III clinical trial in advanced primary head and neck cancer with lead product candidate, Multikine. This CRO is considered to be one of the world’s top CRO’s for running global oncology studies, and will manage the study which is expected to enroll up to 800 patients with advanced primary head and neck cancer in multiple countries around the world. In Phase II clinical trials Multikine was shown to be safe and well-tolerated, and to improve patients’ overall survival by 33% at a median of three and a half years following surgery. The U.S. Food and Drug Administration (FDA) gave the go-ahead for a Phase III clinical trial and granted orphan drug status to Multikine in the neoadjuvant therapy of squamous cell carcinoma (cancer) of the head and neck. Shares lost eight cents on the week to close at $1.21.
SinoHub (AMEX: SIHI) a company providing world-class supply chain management services with transparent information access for participants in the electronic components supply chain in China, announced last week that it has signed a new three-year lease, expanding its warehouse facilities in Hong Kong nearly three-fold to 79,500 square feet to support its growing business operations. SinoHub’s Hong Kong facility serves as its gateway for processing all electronic component imports into China. Currently, the company’s facility, which includes a procurement-fulfillment hub, bonded warehouse and transshipment hub, totals 26,900 square feet and processes nearly $70 million in monthly processing volume of electronic components; management expects that the expanded warehouse facilities will increase the value of electronic components that it can handle to a potential processing volume of approximately $200 million per month, assuming a similar business and product mix. Shares gained forty two cents on the week to close at $3.77.
Stem cell developer Advanced Cell Technology (OTCBB: ACTC) received encouraging news last week, as it was announced that the Obama administration has approved the first human embryonic stem cells for experiments by federally funded scientists in a move designed to expand government support for the up and coming science of regenerative medicine. The National Institute of Health authorized 11 lines of stem cells that will be eligible for federal research grants that would allow scientists to begin tapping millions in federally appropriated funds earmarked to advance the study of stem cells. While private funds are still required to be used in development of new embryonic stem cell lines beyond those eligible for grants from the NIH, proponents of the research are hailing the move as a long awaited step towards removing significant impediments put in place by the Bush administration; it is expected that the announcement is the first in a series of what will ultimately be a vastly expanded bank of stem cell lines eligible to be studied using federal funds. Shares ended the week unchanged at $0.105.
ImmunoCellular Therapeutics (OTCBB: IMUC), a clinical-stage biotechnology company that is developing immune based therapies for the treatment of brain and other cancers, announced last week that it has entered into an option agreement with The University of Texas M. D. Anderson Cancer Center relating to an immunotherapy targeting cancer stem cells (CSCs) which has demonstrated significant abilities to target and destroy CSCs in pre-clinical animal models. The technology being licensed is an immunotherapy targeting cancer stem cells using abnormal Notch and Numb pathways, two mechanisms implicated in many common solid tumors including breast, colon and ovarian cancers. Research indicates that cytotoxic T cells induced by these peptides preferentially target cancer stem cells derived from breast cancer, ovarian cancer and pancreatic cancer; expression of these peptides has been demonstrated on clinical samples from ovarian cancer patients. This latest addition serves to further increase IMUC’s ability to specifically identify and destroy CSCs by targeting additional pathways that were not addressed by its current portfolio. Shares gained eight cents on the week to close at $1.05.
IceWEB (OTCBB: IWEB), a leading provider of purpose built appliances and building blocks for cloud storage networks, announced last week that its Iplicity Unified Storage Platform has successfully passed a series of tests established by Citrix, and has been verified as Citrix Ready, a certification designed to help customers identify third-party solutions that add the greatest value in Citrix Delivery Center Infrastructure solutions. Iplicity provides highly scalable virtualized storage to Citrix deployments and is simple to deploy and manage. From server virtualization projects to Virtual Desktop deployments, Iplicity adds value to Citrix customers by reducing their storage costs, providing lightening fast performance, and easing the burden of administering a complex SAN or NAS storage solution. As a result of the recently granted certification, Iplicity products will carry the Citrix Ready logo, and will be featured in an online catalog along with other products carrying the certification, which management expects will greatly enhance visibility to Citrix customers and channels. Shares gained a penny and a half on the week to close at $0.135
Next One Interactive (OTCBB: NXOI), an interactive media company specializing in Digital Media with a focus on Travel and Real Estate, announced last week that its Resort and Residence (R&R) TV network has completed the first episode of its original series Yacht TV, which will debut December 15. The series will be sponsored by The Sacks Yacht Group, a 25-year-old luxury yacht vacation and sales company, and NXOI’s wholly owned subsidiary, Maupintour, a leader in tour packages for over 50 years, who will leverage the forum to market yacht charters to their customer base, making them one of the only traditional tour companies to offer yacht vacations. The show will feature Sacks Group’s luxury vessels ranging from 70 to 150 feet located in a variety of destinations worldwide, and is expected to generate revenue through several channels including, referrals, booking fees, advertising and sponsorships enhanced with interactive applications; Yacht TV has deals in place that are expected to generate over $60,000 a month from a combination of revenue streams. In related news, NXOI announced last week that it has entered into a partnership with Elite Island Resorts, a premier group of beachfront resort properties in the Caribbean, to feature the company’s Antigua properties in programming for the Resort and Residence TV network; R&R will feature The Verandah Resort and Spa, The St. James’s Club and Villas and Galley Bay Resort and Spa, in addition to providing viewers with a tour of Antigua. Shares lost twelve cents on the week to close at $0.89.
One Bio (OTCBB: ONBI), a company utilizing green process manufacturing to produce raw chemicals and herbal extracts, natural and health supplements and organic products, announced last week that its subsidiary, Green Planet Bioengineering, has secured key certifications on its recently leased land in Sanming China, to initiate botanical extractions of highly demanded and highly profitable herbs. The land includes 1,270 acres for the cultivation of Sarcandra Glabra, a valuable plant whose extracts are used in traditional Chinese medicine for many treatments including bruising, bone fractures, arthritis, nausea, internal pain, and cough. In addition, the lease includes 480 acres for the cultivation of Polygonum Cuspidatum, which yields Resveratrol, a highly demanded raw extract believed to have various health benefits which is extensively used for treatment and research of various cancers and Alzheimer’s disease. Shares gained ten cents on the week to close at $6.10.
XsunX (OTCBB: XSNX), a developer of advanced, thin-film photovoltaic (TFPV) solar cell technologies and manufacturing processes, released a letter to shareholders last week highlighting the presentation given last week by its CTO, Robert Wendt, at the second annual Thin-Film Solar Summit in San Francisco. At the conference, which attracts a wide array of solar industry professionals including scientists, engineers, manufacturers and project developers, Mr. Wendt presented an overview of the company’s technological platform and highlighted the benefits of the platform, citing low risk, speed to market and economic viability as reasons for its revolutionary potential. The presentation is available on the XSNX website, and can be accessed by visiting http://www.xsunx.com/pdf/Thin%20Film%20Summit_Final_2009_11_24.pdf Shares remained unchanged at $0.17 on the week.