Why Everspin Technologies Is Fading And Will Continue To Downtrend
10/12/2017 at 9:00 AM
In October 2016, Everspin (MRAM) IPOed at $8 per share and traded there until a Barron’s article in May caused a strong rally. It is now fading back to $8.
Everspin’s MRAM is too expensive to compete with DRAM, as DRAM will continue to get cheaper and better, and Moore’s Law will continue for many years to come.
Everspin has overly high analyst estimates, and management has hinted that it will miss guidance.
Small companies like Everspin do not last in the memory chip business, economies of scale are essential for profitability, and system designers are reluctant to purchase from a small, and sole, vendor.
At $5M per quarter cash burn, Everspin will need to do an equity raise sometime next year.Read more
ShiftPixy Is Just A Struggling Staffing Agency, It Has Very Few App Downloads, 50%+ Downside
09/01/2017 at 8:21 AM
ShiftPixy uses a social networking app to match employers with part-time “shift” employees.
ShiftPixy’s CEO, Scott Absher, has a checkered past with some pump and dump scams where the SEC had to step in.
ShiftPixy management talks a lot about the new app, but it’s dysfunctional, and has very few downloads after being released a month ago.
We believe ShiftPixy is nothing but a struggling staffing agency trying to look like it has a revolutionary “Uber-like” technology.
With very small net revenue and high expenses, we see 50%+ downside in the stock within a year, and likely an eventual delisting.Read more
Ethema Health: A Ground Floor Opportunity In The Rapidly Growing Substance Abuse Treatment Industry
08/25/2017 at 9:00 AM
Ethema Health (GRST) has limited downside risk at an adjusted book value of $0.066, and is a potential 10x bagger over time.
Ethema Health owns two treatment centers, runs one, rents the other, and is currently acquiring a detox center.
Ethema Health’s treatment center in Delray Beach, Florida is breakeven at only 14% capacity.
There are only two other publically traded behavioral health companies – AAC Holdings (AAC) and Acadia Healthcare (ACHC) and they have gone on a strong uptrend recently. We expect GRST to go on a similar tear soon.
Management has the steps in place to fill up its facilities with patients and demonstrate superior treatment to its competition.
We have a $0.24 price target on GRST.Read more
Delcath Systems Death Spiral Financing And Luxurious Spending Will Result In A Speedily 90% Decline In Share Price
07/12/2017 at 11:00 AM
In the past month, Delcath has risen 1000%+ on promotional hype and no fundamental news.
Delcath is engaging in death spiral financing, the convertible note holders can buy shares at a 15% discount to the recent market price and then immediately sell in the open market.
Delcath’s outstanding share count went from 39 million on February 10, 2017, to 374.4 million on June 5th, 2017, and likely even higher today.
Delcath is conducting clinical trials on its same technology that failed to be approved by the FDA in 2013.
Despite being a struggling company, Delcath’s gluttonous executives award themselves high salaries, fly first class, and are in a ritzy office located in midtown Manhattan.Read more
PDL Biopharma Is A Solid Biotech Investment In A Favorable Regulatory Environment
07/10/2017 at 3:38 PM
Specialty pharma company PDL BioPharma has invested a lot in its acquisition of hypertension drug Tekturna, and has hired a 40 person salesforce solely for it.
PDL’s salesforce is already rolling with convincing doctors and copayers to prescribe and pay for Tekturna, and its sales will grow.
Despite reaching a low in its downtrend, PDL expects to remain profitable, has a large cash position, and a share buyback is in place.
It has very low interest rates with its convertible bonds, and there is very little dilution risk because the bond conversion price is far above the current share price.
PDL BioPharma has a book value of about $4.50, almost double the current share price.Read more
If Ominto Was A Private Company It Would Be Worth A Fraction Of Its Current Price
04/12/2017 at 10:49 AM
Ominto, an online cash back provider, has risen over 150% solely on the hype and exposure of being uplisted to the Nasdaq from the OTC exchange on 2/14/17.
It has tiny sales, stagnant growth and consistently loses $1M-$3M per quarter over the past four years.
A CEO of a top cash back website we interviewed hasn’t even heard of Ominto or its cash back website Dubli.com.
Ominto has made what appears to be a non-arm’s length merger with a company that has a completely different business.
We estimate Ominto’s value to be $1-$2 per share, for an eventual 90% decline.Read more
Matinas BioPharma Has A Weak Drug Pipeline And Investors With Fraudulent Histories
03/24/2017 at 11:30 AM
Matinas BioPharma (MTNB) is one of those rare, no-brainer, diamond in the rough, short ideas.
Matinas BioPharma’s stock has moved from the OTC to the NYSE MKT on March 2, after running up 200% in two months. It has since fallen 20%.
We value MTNB at $0.63 per share, and believe the stock will continue downtrending for a 45-80% decline from here.
We uncovered evidence that Matinas’s largest shareholder, GJG Capital, is covertly run by a barred broker, and on 3/15/17 converted warrants into common stock, suggesting its ready to sell.
Matinas’s entire pipeline consists of two preclinical drugs that were acquired from Rutgers University in 2015 for $2.5M. One of them, MAT2203, had already failed with another biotech company.
Matinas has yet to present clinical efficacy data on its two drugs, yet its market cap is over $200M, we believe it should be below $100M.Read more
Straight Path Spectrum Value: The Truth Is Revealed In Less Than 1 Year
01/27/2017 at 2:52 PM
Lead attorney for Straight Path’s shareholder lawsuit says Straight Path management perpetrated a “years-long fraud”.
“Use it or lose it” is the FCC’s harsh attitude towards unused spectrum like Straight Path’s. Straight Path has a one year deadline to sell its spectrum.
Evidence from the FCC, telecoms, and technology firms all suggest 28GHz spectrum is far superior to 39GHz spectrum. 86% of Straight Path’s spectrum is 39GHz, 14% is 28GHz.
Verizon has the option to buy XO’s spectrum for only $200M, which the vast majority is 28GHz. XO has almost as much total spectrum as Straight Path in MHz-POP.
We believe Straight Path raises many red flags with its statements and actions.Read more
Corrections Corp – Delayed Bullish As Private Prisons Are Here To Stay
09/30/2016 at 12:30 PM
Corrections Corp (CXW) stock has continually drifted lower and now is trading just above book value. A dividend reduction is already partially priced in and expected, so the play is to wait for it to happen and buy up shares on the corresponding dip.
Hillary Clinton’s statements about doing away with private prisons is primarily to gain votes as major changes won’t likely pass through Congress.
While some private prison business will likely be lost from the Bureau of Prisons (BOP), it only makes up 7% of CXW’s revenues. Its business with the rest of its government customers won’t be affected much, with most governments there will be no change.
The national debt is almost at $20 Trillion, a psychological number that will take the conversation in Washington away from expensive and unnecessary projects like investing in new public prisons.
It costs the government much less per prisoner to use private prisons than public prisons. This fact will further prevent Congress from voting on anti-private prison measures.Read more
Scientific Games Dominates Gaming Technology – Could Double In The Next Couple Years
09/01/2016 at 4:05 PM
With Scientific Games large size, the recent CEO change was likely the right choice and investors should buy on current weakness.
Billionaire Ron Perelman, a 40% shareholder of SGMS, late last year bought shares at $8 so that price may serve as a floor of its current weakness.
With the rise and spread of legalized gambling worldwide, there are many positive upcoming catalysts for Scientific Games.
Scientific Games technology is thriving in the hot online gaming market and in person gaming.
The current global economic boom is good for the gaming industry.
Why Relypsa Is Likely A Zero: The Chronic Hyperkalemia Treatment Market Is Small
06/14/2016 at 1:09 AM
Hyperkalemia, or high potassium in the blood, is unnecessary to treat unless it’s at a severe level.
Most medicare and most insurance companies don’t cover Veltassa for a reason.
Veltassa is inferior to its competitor, ZS-9, because ZS-9 can treat both acute and chronic hyperkalemia patients, while Veltassa can only treat the chronic market.
Veltassa’s black box label is a big drawback.There are problems with the drug and its trials, as revealed by government-funded researchers.
A potential Veltassa black swan event, And Relypsa’s CEO, John Orwin’s previous company’s deadly drug.Read more
Synthesis Energy Is All Talk And No Walk – Inefficient Tech
05/17/2016 at 12:30 PM
With energy prices low, Synthesis Energy’s (SYMX) syngas technology is even more uneconomical than it was when energy prices were high.
The company hasn’t had a profitable quarter in over 7 years.
SYMX has a shady past with deals that never go through, and that won’t change despite management’s big talk.
Even though its production is idled, the company is putting out PRs saying it will take on more projects in order to excite retail investors.
Read full article on Seeking Alpha here.
See our next day follow-up article about their fruitless hydrogen plant project here.Read more
MannKind Is On Its Way To Bankruptcy – Are Executives Jumping This Sinking Ship?
03/30/2016 at 8:55 AM
MannKind’s distribution partner, Sanofi, has given up on Afrezza, MNKD’s only product, after investing over $300 million in it.
MNKD executives seem to be moving over to their new collaborative partner, Receptor Life Sciences. Is this to transfer over some assets before bankruptcy?
MNKD was burning $25 million of cash per quarter and will burn even more now as it takes on all the marketing costs for Afrezza.
The bullish thesis that Sanofi was intentionally trying to sabotage Afrezza and make it fail doesn’t make logical sense.
The full report is published on Seeking Alpha here.Read more
TransEnterix Has Unsellable, Impractical Surgical Bots, Massive Share Dilution Pending
02/18/2016 at 9:50 AM
– We have a price target on TransEnterix (TRXC) of $1.20 by the end of the year. TRXC real goal is to sell stock to uninformed retail investors. The company, insiders, and institutional shareholders are selling their shares, or filing to, on this recent pump.
– TRXC has three products their SPIDER surgical system, a failed product which they are discontinuing, and two surgical robots: the ALF-X and the SurgiBot. Evidence shows both are impractical and have little to offer surgeons.
– The ALF-X has already been a commercial failure. It has been on the market since 2012 with the plan to take market share from Intuitive Surgical (ISRG). The ALF-X didn’t sell a single unit in 2013, 2014, or 2015. TRXC acquired the ALF-X for $25M in cash plus stock in late 2015 for the purpose to parade it in front of uninformed investors.
– The SurgiBot is an impractical surgical robot that TRXC has done enough for it to likely gain FDA 510(k) clearance. It will also likely be a commercial failure like the ALF-X and SPIDER.
– In TRXC sponsored studies of the SurgiBot, surgeons say it “has potential” but isn’t quite there yet.
– TRXC management knows its products aren’t very good, one indication of this is the lack of patents. TRXC has only one US patent for its SurgiBot.
– Management aren’t robotics experts, but their competitors are.
– Johnson & Johnson has its own surgical robot company that will compete with TRXC.
– TRXC’s CFO, Joseph Slattery, former company was Trans1 which settled with the US Department Of Justice for $6M for medicare fraud.Read more
ReWalk Robotics Will “ReWalk” Back To Single Digits
12/30/2015 at 9:58 AM
– ReWalk’s (RWLK) Veterans Affairs (VA) coverage was expected from the last two earnings calls and already partially priced in.
– No sell-side analyst showed excitement on the coverage news. Barclay’s analyst raised the PT from $9 to $11, 25% below the current price.
– With only $25M in cash, and $6M per quarter cash burn, RWLK is filed and ready to do a large share dilution soon.
– Due to a low gross profit margin, RWLK needs to sell at least 2,000 exoskeletons per year to break even. It will only sell about 70 in 2015.
– RWLK’s President and Founder resigned last month. He previously criticized their exoskeleton as being “too bulky”.
– Lack of scale will prevent RWLK from expanding to many other countries.Read more
Emerge Energy Services Is Poised To Drop 50% On Three Possible Negative Catalysts
11/11/2015 at 11:00 AM
– Emerge Energy Services (EMES) had an atrocious 3rd quarter and is a bankruptcy risk. We have a $2.50 price target on the stock.
– There are three possible upcoming negative catalysts for EMES: 1.The amendment of its credit facility 2. The start of an ATM equity financing. 3. The 10-Q with “going concern” language in it.
– OPEC is picking up production while US shale is decreasing. Iraq is suddenly flooding the US market with crude! Kuwait’s OPEC rep says the oil glut could last 5 years.
– EMES earnings call sounded pessimistic, but management spun some M&A false hope which propped up the stock price.
– The price action of EMES will likely mimic that of ZINC, which bounced off lows and quickly faded.
Note: on 11/15 we posted a follow-up report on EMES: Has the bear case gotten stronger?Read more
Horsehead Holdings Is A Bankruptcy Risk With Its Dysfunctional Plant And Low Zinc Prices
10/15/2015 at 10:05 AM
– Horsehead Holdings (ZINC) has risen 100% over the past two weeks from a spike up in zinc prices, which has created a ripe shorting opportunity.
– If zinc prices don’t rise soon, Horsehead can go bankrupt in two years. Its zinc hedge expires after 2015.
– Horsehead has had perpetual problems getting its biggest plant, Mooresboro, to half capacity. Its latest update on 10/1/15 wasn’t good.
– Horsehead is in dire need of cash but can’t issue new debt, because its 2017 convertible bonds currently have a yield-to-maturity of 35%, way too high. Issuing equity will also be very hard in such an unfavorable commodities sector.
– We agree with Goldman Sachs that the Glencore production cuts are “not a reason to get bullish” on zinc, and zinc will give back its recent gains on the Glencore news.Read more
VBL Therapeutics’ VB-111 Cancer Drug Is A Colossal Failure
05/19/2015 at 9:32 AM
– VBL Therapeutics (VBLT) put out a PR for its ovarian cancer drug, VB-111 with the word “positive” in the title. However, the drug is a complete failure and the data isn’t positive at all.
– The word “positive” in the title mislead investors and is what caused the stock to rise from a close on May 13th of $4.08 to the mid $5 range today.
– VB-111 + chemotherapy combo has a worse response rate than chemo treatments alone. Avastin +chemo for ovarian cancer showed a much better response rate than both the VB-111+chemo combo and chemo alone.
– VB-111 didn’t show any improvement of reduction in muellerian (ovarian cancer) tumors , so had a 0% objective response rate.
– VB-111 is also very toxic, causing many serious adverse events, and even causing a death in the small 14 patient trial.
– VB-111 is ineffective and toxic, and should not be used in any more trials, for any type of cancer.
– VB-111 was VBLT’s last drug, and it has nothing more in its pipeline. The company is worth its cash value or less.Read more
InterCloud Systems: No Difference In Its Business From Before Its 150% Runup
05/05/2015 at 11:10 AM
– ICLD has risen over 150% since it closed at $1.52 on April 30th. Yet it has risen on PRs that weren’t really news, but were already known.
– The PRs that fueled this rally are 1: a slight increase in its backlog, and 2: an expected modification of its cloud product.
– ICLD’s earnings report and upcoming equity raise are catalysts that will put it back under $2 per share, as the company still has the same unprofitable business.Read more
Builders FirstSource: Was The ProBuild Buyout Expected And Already Priced In?
04/15/2015 at 10:36 AM
– It was discovered by Reuters on March 27th that Builders FirstSource (BLDR) was in talks to acquire ProBuild for approximately $1.5B.
– On that news, the stock only moved about 10% from the low $6s to the high $6s.
– It’s possible that major holders didn’t value the merger very highly, otherwise, they’d have bid the stock up higher before the merger happened.
– On April 13th, BLDR announced the buyout of ProBuild, for $1.63B, and the stock has almost doubled in two days.
– Could it be that the runup is overdone on expected news, or did the market think the buyout wasn’t going to happen?Read more
Ballard Power: Sacrificing Its Future For A Short Term Gain – $1.50 Price Target
02/20/2015 at 10:00 AM
– Ballard Power (BLDP) sold its fuel cell manufacturing patented technology to Volkswagen for $50 million.
– Selling assets is nothing new for Ballard as it continually depletes its cash, but it sold a core asset – its automotive fuel cell technology patents.
– Ballard has never made any money for the past 20 years.
– In a couple years, for the first time Ballard will be completely shut out of the automotive industry. All Ballard will have as customers are buses, stationary power, and forklifts, which don’t provide enough revenues for Ballard to be profitable.
– Signs indicate that BLDP will report missed earnings and/or guide down in its earnings report on 2/25/15.Read more
Aeropostale: The Next Teen Clothing Retailer To Go Bankrupt?
02/10/2015 at 3:05 PM
Today, Aeropostale (ARO) announced higher than expected earnings. But it’s not what it looks like. The following developments indicate that ARO is on its way to bankruptcy.
1. In a PR today, ARO said the forecasted earnings don’t include asset impairments. This likely includes inventory right downs. That will show up in the GAAP earnings statment.
2. Bigger decline in same store sales than expected. Aeropostale said the holiday quarter same-store sales fell 9% after a 15% decrease a year earlier. Analysts surveyed by Retail Metrics were looking for an 8.8% decline.
3. They have hired a CFO replacement, David Dick, who was the former CFO of bankrupt Delia’s, another teenage clothing retailer like ARO. This is a sign the company is getting ready for bankruptcy.
4. Once a certain style goes out of fashion, it doesn’t go back. Aeropostale will likely be the next in a line of bankrupt fashion clothing retailers.Read more
Why Organovo’s 3-D Bioprinting Technology Isn’t Worth An Investment
02/09/2015 at 12:49 PM
Checkout our article published on thestreet.com here.Read more
Gulf Resources, An Old School Chinese Fraud, Had Its Day Today
01/30/2015 at 5:55 PM
– Before today (1/30/15), Global Resources (GURE), a likely Chinese fraud, was trading at around half of net cash since September, 2014.
– Glaucus Research has reported that GURE is a fraud, and worth 0.
– Today, GURE flew as much as 140% as it announced that it found natural gas underneath its oil well, but not how much.We don’t know if there is any natural gas in GURE’s well from what’s said in the PR.
– It even says in the PR: “Gulf does not know,” Mr. Liu added, “if this project will be commercially viable.”Read more
Conflicts Of Interest With MD Anderson Suggests Ziopharm And Intrexon’s Licensed Cancer Therapy Has Little Value
01/20/2015 at 5:43 PM
– MD Anderson (MDA) has a lockup period of four months before it can sell its $115M of ZIOP and XON stock it received for selling them the license to its CAR-T cancer therapy, Sleeping Beauty.
– MDA’s Ex-VP of Research, Leonard Zwelling, wrote about a conflict of interest arising from the deal, in which it’s against MDA’s interest to report any negative findings of Sleeping Beauty and risk ZIOP and XON falling as a result.
– MDA’s engaging in this questionable deal likely means Sleeping Beauty will turn out to be an ineffective therapy.
– XON and ZIOP will likely do an equity raise ASAP while the hype is still fresh.Read more
Intrexon – A Shameful JPM Healthcare Conference Pump
01/15/2015 at 6:14 PM
– Intrexon (XON) licensed a cancer therapy from MD Andersen which cost them $50M in stock.
– Intrexon paid an extra $7.5M to get the deal done quickly so they could present it at the JPM Healthcare Conference and hype up the stock.
– Intrexon might have joined the cancer immunotherapy party too late.
– That’s too bad, because the company is almost out of cash and likely about to have a huge equity raise.Read more
Another Reason Globalstar’s Future Looks Cloudy: New Wi-Fi Technology
12/30/2014 at 5:14 PM
Check out our article published on thestreet.com here.Read more
Viggle’s Incentivized Ad Viewing Is A Weak Business Model
12/04/2014 at 6:39 PM
– Viggle’s (VGGL) business, incentivized ad viewing, is bottom of the barrel ad view quality.
– VGGL spends more money to get users than it gets paid by advertising companies.VGGL spends close to $2M per month on advertising and marketing.
– At this rate, they’ll need to raise more money in 1H15.
– VGGL makes almost 100% of its revenues on mobile phones from its mobile phone app, and the app has a low download ranking.
– The CEO has never bought common stock of VGGL, but is buying highly dilutive preferreds and debt. He is, however, buying common stock of his other company, SFX Entertainment (SFXE).
– VGGL common stock will eventually reach zero.Read more
Vimicro’s Government Connections Don’t Make Up For An Inferior Camera
10/07/2014 at 6:44 PM
– Vimicro’s (NASDAQ:VIMC) shares have gone up on the surveillance video hype, not fundamentals, and will inevitably crash down 50% to the $4-$5 range where it was one month ago.
– VIMC’s management has been on a promotional campaign for the stock, while aggressively selling their shares.
– Vimicro’s (VIMC) SVAC video coding standard isn’t new, it hasn’t caught on in China, and likely never will.H.264 video coding cameras are the mainstream in China, and worldwide, and that won’t change anytime soon.
– VIMC’s surveillance camera sales are entirely dependent on its Chairman’s political connections, something too fragile to count on in China’s ongoing intense anti-corruption campaign.
Holders of Great Northern Iron Ore Trust Will Lose 30% Of Their Money In 7 Months
09/09/2014 at 6:00 PM
There are a group of investors that look to capture dividends of high yield stocks. However, what they fail to realize sometimes is that trusts that terminate in the near future can be very overvalued.Read more