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Since the last Newsletter, we closed one position for a gain.
ACELRX PHARMACEUTICALS (11/20/12). Closed position 1/22/13 at $5.80 for a 55% GAIN.
AcelRx Pharmaceuticals had been inching up since for picked it a few months back, and, for unknown reasons, the stock pierced our 50%-plus ceiling, and we’ll take the gain.
We just saw the best January in over a dozen years, thanks, mainly to the Fed pumping gobs of liquidity into the financial system. The markets even soared as Apple got whacked! Are we nearing a top? This is usually judged by when the small investor starts getting in, and we have seen some signs of this; although small investors have not piled in as they did from 2002 to early 2008. So, does this signal the top? Maybe, but remember that tops can last for some time. However, there still are lingering global issues and, of course, our friends in Washington are about to raise their ugly heads.
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.
Gevo, Inc. (GEVO)(1/20/13). Plans to repurchase $15 million in shares. We have never been major fans of company buybacks, because the money could to better purposes, such as R&D or capital improvements.
Galectin Therapeutics (GALT)(12/20/12). Presents new preclinical data on the efficacy of anti-galectin therapy on diabetic kidney disease. Announces submission of an IND application to the FDA for treating fatty liver disease.
Horizon Pharma (HZNP)(12/20/12). Sues Par Pharmaceutical for patent infringement over its drug Duexis, used to treat arthritis.
Limelight Networks (LLNW)(11/20/12). Sets earnings news for February 19. Names new CEO.
TeleCommunication Systems (TSYS)(11/5/12). Several news items about new patents, new products, and new orders, most notable is that the recent quarterly numbers looked good, as did the balance sheet.
Anthera Pharmaceuticals (ANTH)(10/5/12). Completes $40 million secondary stock offering; and these are usually hard on a stock in the short-term buy good for a company’s long-term health. Law firm launches probe into board of directors. Company shifts its strategy for Bilisibimod.
Zynga, Inc. (ZNGA)(10/5/12). Earnings news slated for February 5. Also, the usual several dozen news stories and releases about the company.
ImmunoCellular Therapeutics (IMUC)(9/20/12). FDA approves IND application for ICT-140.
AXT, Inc. (AXTI)(9/5/12). Sets earnings call for February 25.
Meru Networks (MERU)(8/20/12). Stock gets a nice lift on some very good quarterly numbers; balance sheet still looks good. Anderson University chooses company’s wireless solution for campus-wide support. Essa Academy deploys over 2000 Apples devices using Meru wireless platform.
Novatel Wireless (NVTL)(8/5/12). To report earnings on February 21. Launches 4G LTE mobile hotspot MiFi 5510L with Verizon Wireless. Receives technical approval for MT 3050 device.
pSivida Corporation (PSDV)(8/5/12). Sets earnings call for February 6. Spain grants ILUVIEN marketing approval for chronic diabetic macular edema.
Overland Storage (OVRL)(7/20/12). Slates earnings call for February 13.
Aviat Networks (AVNW)(7/20/12). Quarterly numbers pretty good; balance sheet still looks strong.
Avanir Pharmaceuticals (AVNR)(6/5/12). Sets earnings call for February 4.
Capstone Turbine (CPST)(5/20/12). Receives orders for $2.9 million from German distributor E-Quad Power Systems. To announce earnings on February 11. Gets another follow-on order from a large Australian coal seam gas company.
Bacterin International Holdings (BONE)(5/5/12). Claims that OsteoSponge product is generating positive clinical results.
Axcelis Technologies (ACLS)(4/5/12). To present at the Stifel Nicolaus confab on February 7. Sets earnings call for February 4. Showcases its ion implant technology.
Mattson Technology (MTSN)(4/5/12). Sets earnings call for February 1, the day we post this Newsletter. To present at the Stifel Nicolaus Technology Conference on February 6.
Echo Therapeutics (ECTE)(3/20/12). Presents positive clinical trial results of its Symphony tCGM System. Company plans secondary offering, which could put pressure on its stock price.
Majesco Entertainment (COOL)(3/5/12). Sadly, we are placing this on the “Endangered List” since the company seems to have lost its touch.
Revolution Lighting (RVLT)(12/5/11). We may remove this from the “Endangered List” since the company has a new president and claims to have landed orders with $10 million potential; key word there is “potential”.
ECOtality (ECTY)(11/5/11). Expands relationship with Sears and unveils electric vehicle chargers in TN and AZ. Announces new Minit Charger 12. Georgia Power enables electric vehicle charging at work locations.
Synthesis Energy Systems (SYMX)(8/20/11). Sets earnings call for February 6.
On Track Innovations (OTIV)(6/20/11). Regains NASDAQ compliance.
Gleacher & Co. (GLCH)(6/5/11). Company’s namesake and chairman resigns. Probably not a good thing. This, too, is now on the “Endangered List”.
NeoStem (NBS)(5/20/11). Announces further expansion of intellectual property coverage.
Energy Recovery (ERII)(5/5/11). Sets earnings call for March 6. Ships its PX technology to largest desalination plant in Morocco.
GSE Systems (GVP)(4/20/11). Introduces 3Di-TouchWall, which it says is an affordable alternative to CAVE simulation for immersive 3D training.
Jamba, Inc. (JMBA)(3/20/11). About a dozen articles and releases.
Oculus Innovative Sciences (OCLS)(3/5/11). Sets earnings call for February 13.
Pixelworks (PXLW)(11/20/10). To present at the Stifel Nicolaus technology confab on February . Quarterly numbers not great; balance sheet still seems to be okay.
NovaBay Pharmaceuticals (NBY)(4/20/10). To present at the BIO CEO & Investor Conference on February 11.
Qualstar (QBAK)(10/20/09). Earnings news set for February 6.
Our picks for this Newsletter are a semiconductor and another one of those small biotechs, both are NASDAQ-listed.
TRANSWITCH CORPORATION (NASDAQ: TXCC) – 93 cents. Twelve-month hi-low has been $3.12 – 56 cents. Based in Shelton, CT, with about 165 employees, this semiconductor has 35.8 million shares outstanding, $9.09 million in total current assets, $18.67 million in total assets, little debt, and $14.98 million in total liabilities. Institutional ownership is around 14%. Three analysts rate the stock a “buy”. www.transwitch.com
The first thing to say about TranSwitch Corporation is that the company had a bumpy ride from mid-2011 to mid-2012, but there could be a smoother ride ahead. The next thing to say about the company is that a few months back it received a NASDAQ warning about the minimum bid requirement, but that doesn’t concern us, right now. And, yes, we wish they had more cash on the balance sheet.
Founded in 1988, and public for over fifteen years, TranSwitch designs and supplies semiconductor solutions that provide core functionality for voice, data and video communications equipment for network, enterprise, and customer premises applications. The company provides integrated multi-core network processor system-on-a-chip (SoC) solutions and software solutions for fixed, 3G and 4G mobile, VoIP, and multimedia infrastructures; and a family of communications processors. It offers converged network infrastructure products, including infrastructure VoIP processors for wire-line and wireless carrier equipment; EoS/EoPDH mappers and framers for carriers to transport data traffic over SONET, SDH, and PDH networks; switch fabric devices and adjunct switching devices that enable traffic to be switched of re-arranged to use network capacity; carrier Ethernet solutions, including Ethernet controllers and switches, and circuit emulation and clock recovery devices; FTTx protocol processors; access VoIP processors; and access controllers.
TranSwitch also offers broadband customer premises equipment, such as connectivity solutions comprising HDMI, DisplayPort, HDP, Ethernet IP cores, and HDP transceivers for consumer electronics, home network equipment, and industrial applications; and multi-servicing SoCs that support telephone voice, fax, and routing functionality over broadband access networks.
In early January, TranSwitch launched new HDplay products with MHL capability that supports mobile device connectivity for HDTVs and Pico projectors. In December, the company completed licensing agreements totaling $4 million.
For FY2011, ending 12/30/11, revenue was $28.25 million with $22.87 million in losses. During the first nine months of FY2012, ending 9/30/12, revenue was $12.25 million with $15.08 million in losses. The bright spot was that 3rd QT revenue was 24% higher than the previous quarter, as the company sees an improved 2013 due to such things as an increased backlog of telecom products and IP licensing opportunities.
This looks ripe for some sort of a bounce, especially if 4th QT keeps showing sequential growth in revenues and paring of the loss. At around $1 a share, it’s a semi-risky crap shoot.
Our 24-month target for the stock is $1.65 to $1.85.
For more information, contact TXCC’s Mary Lombardo at 203-929-8810;
APRICUS BIOSCIENCES, INC. (NASDAQ: APRI) – $2.60. Twelve-month hi-low has been $5.23 – $1.89. Based in San Diego, CA, with about 25 employees, this biotech has 29.9 million shares outstanding, $26.7 million in total current assets, $40.75 million in total assets, little debt, and $17.21 million in total liabilities. Institutional ownership is around 5%. One analyst rates the stock a “strong buy” and four as a “buy”. www.apricusbio.com
It is rare to come across a small biotech that has a nice variety of product candidates in its pipeline, but Apricus Biosciences, Inc. appears to be one of those rarities. It also has nearly a half dozen analysts recommending it along with a pretty good balance sheet.
Founded in 1987, and public for over a dozen years, Apricus Biosciences is developing pharmaceutical drugs and drug candidates based on its proprietary NextACT drug delivery technology, which is designed to enhance the delivery of an active drug to improve therapeutics outcomes and reduce systemic side effects that accompany existing oral and injectable medications. Its pipeline products include Vitaros for treating erectile dysfunction (ED); Totect to treat anthracyline extravasation; NitroMist, a nitrate vasodilator for acute relief of an attack or acute prophylaxis of angina pectoris; Granisol, and oral liquid granisetron solution to prevent nausea and vomiting; and Aquoral for treating Xerostomia.
The company’s clinical and pre-clinical products comprise MycoVa for treating onychomycosis; Femprox to treat female sexual arousal disorder; PrevOnco for treating liver cancer; RayVa to treat Raynauds Syndrome; and Nupen for post-chemotherapy recovery of Neutrophil. In addition, Apricus Biosciences is developing drug candidates in the areas of oncology, autoimmune, and anti-invectives.
This is another one of those small R&D biotechs that have a lopsided P&E statement. For FY2011, ending 12/31/11, revenue was $4.1 million with $18.12 million in losses. During the first nine months of the current FY, ending 9/30/12, revenue has been $6.05 million with $12.14 million in losses.
We like the company’s shotgun approach. Maybe there could be something to throwing enough bleep against the wall.
Our 24-month target for the stock is $4.50 to $5.00.
For more information, contact APRI’S Edward Cox at 858-848-4249; firstname.lastname@example.org
Look for the February 20, 2013 Newsletter to be posted on 1/18 or 1/19.