I don't know, but it's frustrating when you dump your shares on the prospect of more bad news, and the stock goes on a run. It's outperformed other biopharmas that I own that are up for approval 2012! This is what makes investing so risky. Sometimes, you really can't predict what a stock will do based on news or even no news at all...
1) Probably a few shorts covering as you suggested.
2) Could be an institutional investor, mutual fund or other type of "whale" moving into MNKD (or increasing their shares).
3) On Tuesday of this week, another small biotech, ACADIA Pharmaceuticals Inc. (ACAD), similar in some ways to MannKind, had great news on its drug canidate "pimavanserin" for those afflicted with Parkinson's disease. ACAD reported that the trial met the primary endpoint by in their 3rd Phase of testing.
The stock shot up from $2.30 to close at $5.43 after reaching a high that day of $6.54.
This pushed up slightly several of my small biotechs this week.
4) The overall markets have been green last two days. Fiscal Cliff help etc.
However, I think that the Market has not enitrely factored in the news about the special meeting for Dec 20 2012, seeking an increase in authorized shares.from 350 million to 550 million. An increase in authorized shares of over 57%! And anyone that thinks that these shares will not be used to raise more capital or be used to fund the 4 generous stock option plans and ultimatley dilute existing shares just does not understand markets and or trying to deceive others.
(I think that the shorts are hoping and even contributing to the slight upward trend here because I think that MNKD will get smacked once more headlines surround the special meeting comes up.)
Despite this, I plan on holding onto more shares and hope that I am wrong about the drop.
It sure would be nice to hear some positive news on the trials (sometime in April 2013 ? ) from MannKind. If Acadia is any indication of what the future may hold for MNKD hareholders, it will be a thrill.
The increased in authorized shares has already been figures in the PPS, mind you the increase in outstanding shares is not in the outstanding shares so there is no dilution unless that happens, and it never might. $200 million till 2014 is more than enough, plus an additional 80 million if warrants are exercised.
There should be no dilution till 2014 at least, they have enough money especially if the warrants are excised. The increase in auth shares are only for just in case. They may need additional funding after approval too for marketing etc. Besides the extra shares may be for partnership in future or to prevent hostile takeover
Agreed. I would also add a personal opinion that the clarity around the partnership discussions, albeit not what some would prefer, is a positive catalyst. Perhaps not as positive as an outstanding deal struck today, but better than no news.
Some would disagree - those who would prefer a mediocre partnership today vs. a better negotiated one mid next year. Sophisticated investors (ones who can drive volume) appreciate the removal of uncertainty and the strength that will be brought to the negotiating table following announcement of topline results. Sure, partners in the past have been privy to data - but to say that the share price (which has direct correlation to negotiating leverage) will be the same in August as it is today is just dumb. (take note OPC)
Timelines are clear and an unobstructed runnup to trial results paints a pretty clear picture of share price at announcement. You can get that price in August, or get ~$2 today. This is on sale and that is driving volume and appreciation.
Sentiment: Strong Buy