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Hello Readers,
Since the last Newsletter, we closed one position, for a gain.
NAVIDEA BIOPHARMACEUTICALS (1/5/12). Closed position 7/3/12 at $4.28 for a 68% GAIN.
For most of June Navidea BioPharma made a nice run on several pieces of upbeat news and we happily took the gain.
And, once again, as we have been saying for the last several months, the markets have still been about Europe, and, again, we are on the verge of another downward spiral. Now, we also have the specter of a lousy earnings season staring us right in the face, along with election uncertainties. Oh sure, over the next month, or so, we may get a few slivers of “good news” that will spawn some feel-good rallies, but the immediate market landscape remains a little bleak. And, once again, our Current Portfolio has been feeling the brunt of this.
Here are the headlines since the last Newsletter about companies in the Current Portfolio; dates in parentheses are when we first recommended them. We are not giving updates about companies on the “Endangered List” unless we feel the news to be highly significant.
Metabolix (MBLX)(7/5/12). Sets FY earnings call for July 26.
Athersys (ATHX)(7/5/12). Receives orphan drug designation from the FDA for MultiStem in Hurler’s Syndrome.
Avanir Pharmaceuticals (AVNR)(6/5/12). Announces notice of U.S. patent application covering NUEDEXTA.
Capstone Turbine (CPST)(5/20/12). Receives multiple orders from two natural gas service companies in Columbia that total two megawatts of prime power generation. Sells two C1000s to Regatta Energy for large California-based natural gas supplier.
Senomyx (SNMX)(5/20/12). Says flavor modifiers received positive determinations on safety.
Bacterin (BONE)(5/5/12). Signs its fourth national GPO contract with the Premier healthcare alliance.
Five Star Quality Care (FVE)(5/5/12). Enters into an agreement to sell its pharmacy business for $30.7 million.
Zogenix (ZGNX)(4/20/12). Begins Relday clinical trial for schizophrenia.
Mattson Technology (MTSN)(4/5/12). Company gets several brokerage downgrades as it lowers its quarterly guidance, which, of course, tanks the stock.
Axcelis Technologies (ACLS)(4/5/12). Sets earnings call for August 2.
Echo Therapeutics (ECTE)(3/20/12). Expands license pact with Ferndale Pharma Group. Wunderlich initiates coverage.
Complete Genomics (GNOM)(2/20/12). Announces new technology developed for clinical-grade genomes; says long fragment read technology provides much higher accuracy sequencing.
BioMimetic (BMTI)(9/20/11). Submits Augment Bone Graft PMA amendment to FDA.
Synthesis Energy Systems (SYMX)(8/20/11). Announces successful testing of high ash coal under joint study pact with Ncondezi Coal Company.
On Track Innovations (OTIV)(6/20/11). Receives order for 17,000 NFC and contactless payment readers to be deployed in Europe for use in mass transit market.
Neostem (NBS)(5/20/11). Updates shareholders. Upgraded by WBB Securities.
ThermoGenesis (KOOL)(4/5/11). Sells its wound care line for $2 million.
Jamba, Inc. (JMBA)(3/20/11). Opens new stores in Washington, DC.
Oculus Innovative Sciences (OCLS)(3/5/11). Receives Chinese SFDA approval of Microcyn Hydrogel.
Sprint Nextel (S)(1/5/11). To release earnings July 26. The usual several dozen stories and news releases.
RELM Wireless (RWC)(11/5/10). Receives blanket purchase order from U.S. Bureau of Land Management.
Inovio Pharmaceuticals (INO)(10/20/10). Initiates H1N1 universal influenza vaccine clinical trial targeting over-65 population, which represents 90% of flu deaths.
ProPhase Labs (PRPH)(10/5/10). Announces launch of NEW Cold-EEZE cold remedy daytime/nighttime QuickMelts and achieves National Product distribution.
Rexahn Pharmaceuticals (RNN)(7/20/10). Submits IND for RX-5902.
CD International (CDII)(4/5/10). Sadly, we need to place this on the “Endangered List” since the company is being bumped to the Bulletin Board.
Novavax (NVAX)(4/5/10). Reports on progress with RSV vaccine.
GlobalScape (GSB)(5/20/08). Joins forces with antivirus firm ESET on technology bundle.
Our picks for this Newsletter are a data storage provider and a wireless equipment provider, both are NASDAQ-listed.
OVERLAND STORAGE, INC. (NASDAQ: OVRL) – $1.78. Twelve-month hi-low has been $3.24 – $1.18. Based in San Diego, CA, with about 190 employees, this data storage provider has 27.6 million shares outstanding, $37.38 million in total current assets, $41.32 million in total assets, and $37.31 million in total liabilities, of which $3.5 million is long-term debt. Institutional ownership is around 19%. Three analysts rate the stock a “buy”. www.overlandstorage.com
The last few years have not been kind to companies like Overland Storage, Inc. but things seem to be getting a little better. The company has been showing some revenue growth and it has been paring the losses over the last three quarters.
Founded in 1980, and public for over fifteen years, Overland Storage is a global provider of data management and protection solutions for primary or nearline storage, disk backup and recovery, and data management. With over 300,000 installations worldwide, it offers Snap Server, a line of network attached storage and storage area network solutions designed for primary and secondary data accessibility and protection; and are available with backup, replication, and mirroring software in fixed capacity or highly scalable configurations.
Overland Storage also provides NEO SERIES and REO SERIES of virtual tape libraries, tape backup, and archive systems designed to meet the need for data storage for long-term archiving and compliance requirements. In addition, the company offers data management software, including GuardianOS, a storage-optimized platform operating system; Snap Enterprise Data Replicator, which provides multi-directional, WAN-optimized replication for Snap Server systems; and Protection OS software that offers virtualization, data protection, data management, and connectivity features for REO virtual tape library systems. It serves such industries as financial services, video surveillance, healthcare, retail, manufacturing, telecommunications, broadcasting, and R&D, along with various government and educational facilities.
The company’s stock price was kept down over the last year or so due to questions about its patents being valid. However, at the end of June, the International Trade Commission (ITC) ruled that they are valid, which help to lift the stock from its recent lows.
For the FY ending 6/30/11, revenue was $70.19 million with $14.5 million in net losses. During the first nine months of the current FY, ending 3/31/12, revenue was $44.33 million with $13.47 million in net losses.
Besides shedding the patent validities, the company also claims to be seeing some positive results from recent investments made to update its technology.
Our 24-month target for the stock is $3.25 to $3.50.
For more information, contact OVRL at 858-571-5555.
AVIAT NETWORKS, INC. (NASDAQ: AVNW) – $2.71. Twelve-month hi-low has been $4.40 – $1.62. Located in Santa Clara, CA, with about 1000 employees, this provider of communications equipment has 61.25 million shares outstanding, $303.6 million in total current assets, $329.8 million in total assets, little long-term debt, and $170.3 million in total liabilities. Institutional ownership is around 84%. Two analysts rate the stock a “buy” and three have it as a “hold”. www.aviatnetworks.com
Small tech companies have had a pretty dismal year, for the most part, but some, like Aviat Networks, Inc. have begun to see life in their stocks. Aviat is a long-established entity that has seen ups and downs. This may be time for another up.
Formerly known as Harris Stratex Networks until 2006, and public for over 25 years, Aviat Networks supplies wireless transmission solutions. With over 750,000 systems installed worldwide, Aviat offers point-to-point and point-to-multipoint digital microwave transmission systems for first/last mile access, middle mile/backhaul, and long-distance trunking applications. Their products include broadband wireless access base stations and customer premises equipment for fixed and mobile; point-to-point digital microwave radio systems for access, backhaul, trunking, and license-exempt applications; and supporting network deployments, network expansion, and capacity upgrades. It also provides network management software solutions to enable operators to deploy, monitor, and manage its systems, as well as third party equipment, such as antennas, routers, and multiplexers to build and deploy a wireless transmission network and a suite of turnkey support services.
Aviat Networks also offers professional services such as network planning and design, site surveys and builds, systems integration, installation, maintenance, network monitoring, training, and customer services. It serves mobile and fixed communication providers, OEMs, private network operators, government agencies, and a wide variety of industries.
At the end of June, Aviat garnered a multi-year agreement with East Bay Regional Communications Systems Alameda and Contra Costa counties in California.
For the FY ending 6/30/11, revenue was $452.1 million with $90.5 million in losses. During the first nine months of the current FY, ending 3/31/12, revenue was $328 million with $22.8 million in net losses. Current QT guidance calls for nearly $110 million in revenue, which means that current FY revenues will be under last year’s, but the losses may not be as ugly.
As we have alluded, this is an established tech that has had a recent bumpy road, but whose stock is poised to move higher.
Our 24-month target for the stock is $4.25 to $4.50.
For more information, contact AVNW at 408-567-7000.
Look for the August 5, 2012 Newsletter to be posted on 8/1 or 8/2.
Thank you,
George