Well bunker dwellers, I think we need a pep talk. If you’re looking for an image, think of George C. Scott playing Patton, and standing in front of that big flag. It’s time for some inspiration.
This week marks 3 straight in the red. It’s discouraging. It feels like we’re in a boxing match that’s gone very, very badly. We can’t get our balance and we just keep getting pummeled. We need for the bell to ring…
Ok, so much for inspiration. Let me start again. How’s this: Was AAPL over-valued when it was over $700 per share last September? Was it under-valued when it hit $435 on January 25? That’s a 38% swing over the span of about 4 months. What’s my point? At a given time, a stock’s price can have very little to do with the value of a company. It fluctuates like the weather has this winter in the southeast.
Let’s look at the *%^$ numbers: AVNR lost 5 cents on the week to close at $2.91 which is 1.68%. The NASDAQ was green, gaining 0.9%. YTD, the stock is still green by 11.2%. Last February 2, the stock closed at $3.24. So the YOY comparison is now negative by 10.1%. This of course has appeared inevitable for the past few weeks.
Here’s how the week went day by day:
Monday: NAS had a green day but stayed in a narrow range, closing up 4.59 points (0.15%) to close at 3154.3. With good numbers reported in the morning-over 3,100 NRx!!—AVNR gained 6 cents or 2.03% to close at the HOD at $3.02. Volume was 1.405 million.
Tuesday: The NAS had a mostly red day but climbed to green in the last half hour, only to close down by 0.64 points, or 0.02%. ANVR had a see-saw day ending even to close at $3.02. Volume was 1.02 million.
Weds: The NAS had a mostly red day, closing down 11.35 points or 0.36%. AVNR was red for the day, closing at the day’s low of $2.92, down 10 cents or 3.31%. Volume was only 899K.
Thurs: NAS was mostly green all day but closed down 0.18 points or 0.01%. AVNR was green all day until about 3:10, when the bottom fell out. Closed a very unsatisfying even at $2.92. Volume was very low at 696K.
Friday: NAS was green, following the DOW as it went over 14,000. It ended with a gain of 31.79 points (1.18%). AVNR tried, staying green until 1:00, but closing down a penny, or 0.34% to close at $2.91. Volume was again low at 646K.
This week has been a rather unpleasant trip down memory lane. A harkening to the days of low volume, when a 100 share trade could take the wind out of the sails of a rally. Wednesday’s loss of 3.3% was on 899K of volume, while the average over the past several weeks has been 1.2 million. That’s hardly a sign of conviction in the selling. Thursday was even more galling. The stock was cruising, until it hit a wall. Look at the chart! It didn’t go red, but there was a moral loss (the opposite of a moral victory). Volume? 696K. How did that happen?
Longs, for whatever reason, we have some powerful enemies. There are still 22 million shares short, as per the Falconi Line. Do you know how much money it takes to hold that many shares short? Heck, even 50,000 shares short would be an expensive gamble. Some heavy hitters are betting big this stock is going to go down, or at least not go up. If you think they’re not doing anything behind the scenes to protect their position, I’ve got a bridge I want to sell you.
The tone here on the board is grim. Longs are whistling in the dark, and the shorts are pouncing. And they aren’t confined to the truth. A comment was made late in the week that Avanir was “hemorrhaging cash”. An impressive term, used appropriately, if inaccurately. Yes, the company is still in the red, but not for long. I’d say the company becomes profitable by the middle of this calendar year (Q3 2013). [Now, I know that I “predicted” that AVNR would be break-even by 12/31/12, but I wanted to participate in Ray’s contest, and no one had at the time I weighed in. I guessed early—so sue me.]
But the Rx numbers are truly encouraging. That NRx number reported Monday (thanks, Jean) is very, very cool. Over 3,100. Don’t look now, but the updated marketing plan may just be working.
And here’s the kicker: this is my horoscope for today: “An important situation, whose slowness to develop has caused you considerable concern, could suddenly start to turn in a favorable direction.” That’s a direct quote. And who can doubt my trusted astrological advisor, Bernice Bede Osol? Our good fortunes are written in the stars!
But seriously, it’s not that bad, longs, and it may be getting better. Pull up a 9-month chart on your favorite investment site. Take a look at the peaks last July and September. The stock rushed to a high, and then rushed back down immediately afterward, both times. Now look at the last few weeks. Yeah, we got over 3 bucks again, and we have been going down. But not as fast. I think that’s significant.
For today’s song, I’m returning to Pete Townshend. I wanted a song that spoke of unrequited love (you can guess why). I thought of this one—A Little Is Enough. This is a live performance, and the HUGE band is really, really on top of a complex song. And Pete’s vocal is crystal clear. Note: the drummer is wearing a 49ers shirt with Joe Montana’s number 16. I’m juust saying. Turn up your speakers. Go to you tube, and paste this in after the back slash.
Nice weekly summary as always, sarge. Just to look ahead a bit, remember that this week
AVNR will report financial results for the quarter ended December 31, 2012 after market close on Thursday February 7, 2013. CC slated for 4:30 EST. I think it's possible that KK & Krew might just throw the long-suffering longs a bone. At any rate, we'll probably get some information that we can pick apart here in YA-YA land. Seems like they might even be able to give us a forecast for next quarter.
On the subject of the script #s, I'm leaning toward a decrease because SRK's WK info seems to front-run the IMS figures, though the correspondence is somewhat erratic.
I'm also invested in SPPI, and I believe the bump in BlackRock's shareholdings revealed last week is a good sign. If we see good Fusilev sales last Q, the stock might break out of the doldrums, AF's poo-pooing notwithstanding.
Thanks for the note, #$%$-man. It sure is good to see your familiar handle around here. I appreciate you keeping your finger on the pulse of the short interest--it means I don't have to!!
At recent earnings conferences, the company has not seemed eager to put out forecast numbers. Given how recently they re-vamped and augmented the sales force, I'd be surprised if they gave real numbers. But they MAY just forecast when the company will become profitable, as in which quarter, based on current numbers and trends. I'd take that bone.
SPPI. I got a little lucky on that one. Needed some cash, so sold some shares last year when the stock was in the mid-teens. Even given the % of shares held short, which is, what? close to 50? Anyway, even with that, I'm amazed they've been able to keep that stock's price held this low for so long. They're swimming in cash--how many biotechs are even profitable? And they're giving a dividend! And yet, the stock price keeps a P/E of around 7.
Yeah, that AF, leading the charge of the bears, is a real gem.
Enjoy the game tonight if you're watching. See ya around.
As the old saying goes rinse and repeat as far as avnr goes. Never get married to a stock! Just think for a moment all the missed opportunities that you have missed out there with other. Stocks while stuck here cheerleading for avnr. Stock price $5.80 post approval. 2 plus years of sales data and can't break $3 food for thought to put it mildly!
I actually bought some AAPL on January 25th! Thought it was way oversold also! I would like to see news about AVNR that would cause a good run to just below $10. With all the shorts it would explode like that if KK can either deliver Europe news or deliver an quarterly profit. I think both are achievable soon!
Hi Sarge, nice report as always. I hope last week's script numbers are a sign that the new marketing initiatives are working and the focus on LTC is beginning to produce tangible results. I understand that consistent, fundamental company results are what are truly needed to break this share price to higher levels.
I also believe there are powerful interests that negatively weigh on Avanir's throat that most likely include shorting and swing trading hedge funds, complicit MM's and blue chip, prime brokers whose billion dollar profits depend on the hedge fund premium commissions. This institutional manipulation is no longer dismissed as the ravings of the lunatic fringe and if we are ever going to restore the integrity of our financial markets, it will take victimized companies management speaking out loudly to the news media, their members of Congress, the SEC, DOJ and the trading exchanges to call for investigations. Cockroaches don't like light being shined on them and it is time for this systematic abuse to end.
Katkin and other well-compensated company CEO's are not going to rock the boat unless they face relentless pressure to do so. I think it is reprehensible that Katkin (following the customary trend of CEO's) does not discuss share price to any significant degree in the many conference calls he has conducted. It is inexcusable that Katkin doesn't weigh in on why Avanir's relative shareholder value continues to languish these past two plus years despite FDA approval, albeit slow but progressive sales growth now approaching approximately $80M per year. Yet still no significant increase in value and the CEO doesn't believe he owes his shareholders any explanation as to why? I am sure there are many here who have grown tired of my occasional vents on Katkin's (and BOD's) bloated compensation while us shareholders continue to twist in the prevailing, manipulated winds. I am disgusted when I see these managers rake in millions at the expense of their shareholders while showing indifference to their shareholders not realizing any increase in value.
I believe it is time for a consistent, concerted effort by shareholders to write Katkin and the BOD and demand that they publicly speak on concerns with share price manipulation and call for an investigation into Avanir's trading. Sarge, if you concur, I think you can be a catalyst for this initiative with your deserved popularity on this board and periodic prompting with your Saturday report. Please give it some thought as we retail investors are the true victims of this travesty.
All just my opinions only.
"I believe it is time for a consistent, concerted effort by shareholders to write Katkin and the BOD and demand that they publicly speak on concerns with share price manipulation and call for an investigation into Avanir's trading. "
I suspect that conspiracy theories about market manipulation are overblown and a knee-jerk response to company stock prices that aren't as high as companies and their sycophantic analysts have led people to believe they should be.
I think a market cap of $400 million is fair for a company like Avanir with one drug that, almost 2 years after launch, is doing only about $68 million per year of NET Nuedexta sales
One thing that leads to the perpetuation of such conspiracy theories is people think they are helpless victims.
To that end, I point out that anyone can report suspicions to the SEC. So to paint the situation as one where alleged victims need to get their company to report, "concerns with share price manipulation" perpetuates the helpless victim mentality and fosters the continuation of conspiracy theories. Especially when the company does not agree that anything needs to be complained about to the SEC.
To stop the helpless victim mentality and to limit conspiracy theories, I therefore suggest anyone who has any, "concern with share price manipulation" report their, "concern" to the SEC directly. I would then assume the SEC would take any appropriate steps to investigate anything they thought was the least bit suspicious.
I'm right with you, OBH Friend. I think it's time our officers and board started acting like the fiduciaries they are supposed to be, and step up to protect shareholder value.
Any who have time, call or e-mail or tweet or whatever to Ian, KK, Kristine, and anyone who'll listen. We INVESTORS are hanging out here, apparently alone. We could use some support!
Thanks Sarge........great report. Patience is the word. Strangely enough, I have 6 other biotech stocks and none of them had a really good week with the exception of SPPI, which showed a little life.
I'll be pulling for the 49er's. Totally sick of the Ray Lewis hype and RAH RAH bull.
EPS report after Thursday's close.
Hey, I saw you posting on the SPPI board, Kel. Yet another in the "club" of companies being trashed by AF. Some day, that guy's gonna be brought to justice.
I like the looks of Spectrum. Clicking on all cylinders, and making $300 million a year. It must be one of the most undervalued stocks on the market.
Should be a great game tomorrow. If the 49ers win, Jim H. will be annointed the game's new Genius, with his switch to Kaepernick mid-year.
That song--wow. And I thought I was depressed! I understand your feelings. It has been a long, strange, and unrewarding trip indeed. To paraphrase a Bay Area band.