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ADVANCED CELL TECH Message Board

  • pstrgod pstrgod Jan 8, 2013 7:28 AM Flag

    Nouvelle Asset Management

    Advanced Cell Technology (ACTC.OB) is much loved by the biotech trading community and has generated a cult following of sorts due to its volatility and momentum swings; following some insider buying towards the end of last week, ACTC shares gained 32% ($0.02) in a single session on Friday with volume of more than 25M. Nevertheless, the stem cell technology developer is one of a few stem cell companies to demonstrate promise with its technology. Its lead candidate in the clinic is being tested as a treatment for degenerative retinal diseases (age-related macular degeneration and Stargardt's disease), and while the company operates in a controversial space, it may pan out for shareholders in the long run. The market for an effective macular degeneration treatment is enormous (the company pegs the market opportunity at more than $25B), and Advanced Cell's retinal pigment epithelium (RPE) program, its lead program, has already shown tolerability and safety in early clinical trials. More importantly, the company will finish up Phase II studies in the next year, which will be major catalysts for the stock if positive. And ACTC secured a common stock purchase agreement with Lincoln Park Capital in September, obligating the institutional investor to purchase $35M in common stock over three years. With the Lincoln Park agreement, $8.3M in cash and equivalents at Sept. 30, and an average annual burn of $16M, the company should have sufficient capital for a year or two of operations.

    Oddly enough, ACTC decided against uplisting to a major exchange at the end of last year and remains on the OTC BB. That and a history of questionable debt deals, plus an immense amount of shares outstanding, suggest that investors should proceed with caution. While ACTC holds some promising technology, management needs to prove its commitment to shareholders (high compensation, lack of a CFO, no uplisting) before investors throw caution to the wind. ACTC may be best suited for the day traders and long-term value-seekers with some cash to gamble.

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ACTC
6.98+0.18(+2.65%)Nov 13 12:19 PMEST

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