Trends, Charts and Exclusive Opinion
Three SmallCaps that are in Rally Mode
QCOR: The Rally Is On Despite Slightly Weaker Quarter
BKMU: Regional Bank Handily Deals with 2009 Setbacks
CLDX: Acquisition of Curagen Will Bring in New Revenues
First up this morning is Questcor Pharmaceuticals Inc., (QCOR) http://www.questcor.com/ currently trading in the $7.41 range on 700k+ shares traded daily. QCOR was trading in the $4.50 to $5.50 range for the early part of 09 and in the summer, broke out into the $6.50 range. QCOR dropped back in the fall and node-dived in Nov to the $3.50 level. But that didn’t last long. QCOR was back up in the $4.50 range rather quickly and this month; shot up to its current price. QCOR has a 52-week high of $7.73 set on 03-18-10. QCOR has trailing twelve month revenues of $88+ million and a positive, corresponding diluted EPS of +$0.40. There are a few more shorters of this stock than I like, but the rally is on for QCOR and they’ll be thinning out to cover their positions. QCOR is a long-term (1 Yr) ‘Buy’ consideration for me. Here’s why...
QCOR’s primary drug is Acthar, approved to treat flare-ups with multiple sclerosis, an autoimmune disorder that affects the central nervous system. The drug is very, very popular as a treatment and is kept in high regards by the medical community. QCOR has a winner in Acthar. On March 2, QCOR Q4 numbers posted earnings of $8.4 million, or 13 cents per share, down from $16.2 million, or 24 cents per share, in the same period a year ago. Revenue fell to $25.9 million from $27 million. Operating expenses rose 38% to $10.6 million while the company's tax expense jumped to $5.1 million from $1.5 million. For the full year 2009, QCOR earned $26.6 million, or 40 cents per share vs. $35.3 million, or 49 cents per share, in 2008. Revenue fell to $88.3 million from $95.2 million.
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Next up is S&P SmallCap 600 company Bank Mutual Corporation (BKMU) http://www.bankmutualcorp.com/ currently trading in the $7 range on 1 3-Month average daily trading volume of 161,954 shares. BKMU was trading in the $9 range a year ago. The stock did rise to $11 in May of 09, but gave up those gains and found some stability through Oct in the $8 to $9 range. BKMU dipped in late-Oct, found $7 and stayed there for the next 3-Months. BKMU dipped to $6 in Feb and is now in a rally mode.
BKMU has a 52-week high of $11.16 set on 04-22-09. BKMU has trailing twelve month revenues of $86+ million and a positive, corresponding diluted EPS of +$0.29. Considering the loan losses many regional banks sustained in 2009 (BKMU included), to still return 29 cents to shareholders in earnings really says something about management and the integrity of a bank. BKMU, which operates 78 banking offices in Wisconsin and 1 in Minnesota, is a long-term (1 Yr) ‘Buy’ consideration for me at $7.
In Jan BKMU reported net income for the year ended December 31, 2009, of $13.7 million or $0.29 per diluted share vs. $17.2 million or $0.35 per diluted share in 2008. Net income for the fourth quarter of 2009 was $1.5 million or $0.03 per diluted share vs. $6.2 million or $0.13 per diluted share in the same quarter last year.
Finally this morning is Celldex Therapeutics Inc., (CLDX) http://www.celldextherapeutics.com/ currently trading in the $5.54 range on a 3-Month average daily trading volume of 377,682 shares. CLDX was trading in the $7 range a year ago, spiked up to $14 in June on what must have been an anomaly and fell back to $8 by the end of the month. CLDX dropped down into the $5.50 range over the next 3-Months and has stayed there for the last 7-Months. CLDX has a 52-week high of $14.19 set on 06-01-09. On a public float of 29+ million shares, CLDX has a short % of float as of 02-26-10 of 14.70%. That’s a lot of shorters putting downward pressure on the stock. At the $5.54 range, CLDX is a long-term ‘Buy’ consideration for me. Here’s why...
There is a rally beginning to take form on CLDX and it is because of its acquisition of Curagen, the charges have already been factored into the price, and the CLDX pipeline. CLDX had a weak Q4 with a loss of $13.5 million, or 43 cents per share vs. a $7.5 million, or 47 cents per share, loss a year ago. Celldex had about 31.6 million shares on the market during the most recent quarter, up from 15.8 million in the last quarter of 2008. Revenue increased to $4.7 million from $3 million. In Q4, CLDX’s product royalties nearly doubled to $2.5 million from $1.4 million. For the 2009 year, CLDX lost $37.1 million, or $1.87 per share, down from $47.5 million, or $3.34 per share in 2008. Revenue more than doubled to $15.2 million from $7.5 million.
CLDX makes and sells targeted immunotherapies that prevent or treat specific forms of cancer, autoimmune disorders, and diseases caused by infectious organisms. Even a partial listing of its pipeline is too long for this article. CLDX has collaborative partnership agreements with GlaxoSmithKline, Pfizer, Vaccine Technologies, and TopoTarget, as well as research collaboration and licensing agreements with Medarex, Alteris Therapeutics, 3M Company, Amgen, Amgen Fremont and Seattle Genetics.
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