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With profit-takers temporarily satisfied with Friday's sell-off, the bulls were eager to re-take the markets this morning and re-establish recently set thresholds. SmallCap stocks PRKR, SUPG and ELRN all surged on good corporate news during early in today's rally.
A Key Product Delivery, a Deal with a Major Pharmaceutical Company
and Getting a Very Good Price for a Subsidiary
Gaining 17.83% this morning is Parkervision Inc., (PRKR) http://www.parkervision.com/ currently trading in the $3.30 range. PRKR topped its 3-Month daily trading average within the first hour.
PRKR announced today that it has successfully delivered sample 3G mobile handsets incorporating its d2p radio frequency integrated circuits to a commercial chipset customer. The PRKR handsets met all relevant industry standards and passed a series of tests that verify operational performance of the hardware when deployed on mobile phone networks.
The PRKR customer verified that the d2p transmit chain achieved power consumption savings at all points along the RF transmit power curve when compared against the mass produced transmit chain that d2p replaced in the mobile phone reference design.
PRKR and the Military
What I like about PRKR is that it has a strong military connection for its mobile telecomm devices. Earlier this month, PRKR received a purchase order from ITT Corporation (ITT) to incorporate PRKR's Direct2Power (d2p) wireless technology into a highly-integrated transceiver radio platform for use in military radio applications. The contract was awarded to ITT by the U.S. Army Communications-Electronics-Research, Development and Engineering Center. PRKR was designated as a sub-contractor.
The PRKR Q2 2009 numbers released in early August posted a loss of 17 cents a share (which was better than Q2 2008) and at $3.30, the stock is nearly half its 52-week high of $6.04 set on 11-04-08. AS you can see on the chart, PRKR has dipped since its mid-September $4.75 range. I like this company because its management team is thinking 'top-line' and another sale will easily push it back to the $4.75 level. I think it's a good buy at this price if you're interested in getting in on integrated circuits and the wireless communications market. Another military contract could push it past its current 52-week high.
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PRKR
Gaining as much as 19.75% this morning is SuperGen Inc., (SUPG) http://www.supergen.com/ currently trading in the $2.71 range. SUPG also beat its 3-Month average daily trading volume within an hour of today's open.
SUPG announced today that that it had entered a multi-year deal with GlaxoSmithKline (GSK) to research and develop cancer therapeutics based on SUPG drug candidates. SUPG will get $5 million upfront; $3 million of which is a common stock investment. SUPG management also noted today that total potential development and marketing milestones could exceed $375 million from GSK.
The deal has SUPG working on clinical developments and in turn, GSK will have the right to exercise an option to develop them further and commercialize the drugs globally.
SUPG and GSK will develop cancer therapeutics based on epigenetic targets, which refer to the regulation of genes with mechanisms other than changes to the underlying DNA sequence. Epigenetic processes are widely believed to play a central role in the development and progression of almost all cancers.
In the $2.71 range, this stock is a 'Buy'. The SUPG 52-week high is $3.30 and as the partnership gets underway, the stock will bounce back to its mid-September, $3.25 range as seen in the chart. The resulting test performances of SUPG drugs in the near-term will propel the stock. SUPG has numerous drugs in Phase III and Phase II trails.
SUPG management is set to release Q3 numbers today, after the market closes, and even if they are poor (analysts are looking for a 7 sent loss), they won't hold back the GSK momentum beyond reason.
SUPG ELRN
Gaining as much as 15.48% this morning is Elron Electronic Industries Ltd., (ELRN) http://www.elron.com/ currently trading in the $7.02 range. ELRN also passed its 3-Month average daily trading volume in the first hour.
ELRN said today that it entered into 'a non-binding indication of interest of a third party regarding a potential acquisition'. That's a mouthful. LawyerSpeak. Someone is looking to buy Medingo Ltd., an ELRN subsidiary.
The 'Indication' relates to an acquisition of Medingo's entire share capital for a cash consideration ranging from $150-170 million. Milestones could put the deal in the $185-213 million range.
Here's the good news for investors: In the event of the deal going through, ELRN could be expected to record a net gain initially estimated at this stage to be between approximately $54 million and approximately $80 million. And here's the official disclaimer: There is no assurance of the occurrence, timing or terms of any such transaction. Medingo is 92% held by ELRN (including 83% held by RDC, ELRN's 50.1% subsidiary).
Medingo is engaged in the development and commercialization of a miniature insulin dispensing patch pump for the needs of insulin-dependent diabetic patients.
ELRN has made a nice climb from its September valley (see the chart) and is approximately $1.40 off its 52-week high set on 07-29-09. There could be money to be made here as the deal progresses. I put ELRN on my 'Watch Closely' list.
If you'd like to know of any changes in our opinion of PRKR, SUPG or ELRN
(or if SCN officially recommends them as trades)
