STOCKS TELEGRAPH

Author: Nicholas K

  • 3 High Potential Stock to Watch Today: Biotechs Lead the Way

    MyoKardia Inc [NASDAQ: MYOK]

    In a bid to expand its portfolio of heart drugs, Bristol-Myers Squibb Co. Has agreed with MyoKardia Inc to purchase the company for $13.1 billion. In the agreement, Bristol-Myers is set to pay $225 per share which is about 61% premium over the company’s Friday’s closing stock price. MyoKardia’s stock price had risen 59% in its premarket trading.  Following this purchase, Bristol-Myers will now control MyoKardia’s leading product Mavacamten.

    This experimental drug treats obstructive hypertrophic cardiomyopathy. This acquisition will have expanded Bristol-Myers’ scope of heart drugs from those focussing only on oncology, an area where the industry has focussed on for quite a while now. According to the statement issued regarding this deal, Bristol-Myers will issue an application for the approval of Mavacamten during the first quarter of 2021.

    The company plans to research more on the uses of this drug and manufacture other additional experimental compounds that they will get from MyoKardia. Hypertrophic cardiomyopathy is a heart condition in which heart muscles develop abnormal thickness preventing the heart from pumping blood effectively. The condition affects about one in 500 people.

    Kosmos Energy Ltd [NYSE: KOS]  

    Kosmos Energy, a deepwater independent gas and oil exploration and production company announced today that it has shut down its facility at the Gulf of Mexico with Trafigura Trading LLC and Beal Bank USA.  In a move set to strengthen the corporation’s liquidity position, it has restructured its facility at the Gulf of Mexico into a five-year $200 million loan term that will be backed by the company’s assets at the same Gulf.

    Another $50 million advanced from Trafigura signed in June has been rolled into the facility with backing from CSG Investments; Inc. Beal Bank will provide the remaining $150 million. With a 6% interest rate, the facility has increased its borrowing capacity by $50 million, extended its repayment term by five years, and secured a feature to expand the facility by up to $300 million.

    Neal Shah, the Chief Financial Officer said in a statement that the closing of this facility has enhanced the company’s liquidity position, given it access to low-cost and flexible financing as well as free cash generated low-cost production assets. He expects the company’s balance sheet to strengthen significantly as of 2021.

    Corvus Pharmaceuticals Inc [NASDAQ: CRVS]

    Corvus share price saw a sudden spike after the company announced that its small phase 1 early-stage clinical trial could produce antibodies and T-cells among some Covid-19 patients. The share price rose by 39.1% in premarket trading on Monday after this announcement.

    The clinical trial, open-label, Phase 1 study has already administered three doses in 15 test-patients and hopes to expand its scope to about 30 patients that exhibit mild to moderate symptoms of the disease.  In a preprint issued in September, the company had shown the results for the two of the doses administered in 10 patients. This publication has not been peer-reviewed.

    Corvus plans to release the full results from the first phase at the end of this year.  Its stock is still 25.2% down as of this year with the S&P 500 gaining about 3.6%.

  • 3 Stocks Braving Market Selloff after Trump Tests Positive for COVID-19

    3 Stocks Braving Market Selloff after Trump Tests Positive for COVID-19

    Equity markets have fallen sharply today all over the world. In the U.S, key indices are all in the red pointing to a potentially weak close to the week. In pre-market trading, the NASDAQ is down by 2%, the S&P 500 by 1.55%, and the Dow Jones by 1.46%.

    This follows news that the U.S president had tested positive for COVID-19. The president announced via twitter that together with his wife, they had tested positive for the virus and that they had started quarantine. This has thrown the markets into a spin as it indicates just how serious and unrelenting the virus is. It is also noteworthy that the number of infections continues to rise globally, and some countries have returned to strict lockdown measures shortly after easing them up.

    The number of deaths continues to rise too and recently crossed the one million mark. This points to a prolonged period of a disrupted global economy that could remain unstable until a vaccine is found. The worst part is that the news of the president contracting the virus has come just weeks to an election after a highly emotive campaign. However, even as overall market momentum points to weakness, there are stocks that are braving the selloff and doing quite well. Some of the pre-market gainers that could outperform the market today are as below:

    Nano-X Imaging Ltd [NASDAQ: NNOX]

    Nano-X Imaging Ltd is quite strong pre-market and is up by over 25%. This follows news that the company would do a live demonstration of its new imaging system at the RSNA 2020, between November 29th and December 5th. The company’s demonstration will incorporate a tech section for the company’s first commercial digital X-Ray that would be followed by a demonstration of the system handling both 2D and 3D procedures. The CEO said that they were excited about the demonstration as it exposed the growing depth of the company’s technology.

    Xtant Medical Holdings [NYSE: XTNT]

    Xtant Medical Holdings Inc is another top performer this morning and is up by over 100% in performer this morning.  This follows the company’s announcement that it had completed its debt restructuring process. The company stated that the goal of the restructuring is to cut down on total debt and help the company access the capital markets for future growth.

    Lonestar Resources U.S Inc [NASDAQ: LONE]

    Lonestar Resources U.S Inc is another top gainer today and is up by over 100%. This comes despite a downgrade of the company by Moody’s to D-PD after it filed for bankruptcy.

  • Why This JP Morgan ETF [EMB] Is Up 35% and Gaining Despite the Pandemic

    Why This JP Morgan ETF [EMB] Is Up 35% and Gaining Despite the Pandemic

    The emerging bonds market always poses an elevated risk-return scenario. Since these bonds generally carry a higher risk compared to the more mature markets, they also present a higher return. One of the most interesting emerging bond funds that have given investors a good return all through the pandemic is the iShares J.P Morgan USD Emerging Markets Bond ETF [NASDAQ: EMB].

    It has been on an uptrend for the better part of 2020, despite the overall market volatility. If recent indicators are anything to go by, this fund is still overall bullish.  A look at the options outflow sentiment for EMB shows an increase in call options relative to put options. This means that most options traders expect this fund to keep gaining in value.  There are several reasons behind the increased optimism in this fund. Some of them are as below:

    Interest rates are too low in the mature markets

    Interest rates in the U.S and most of the developed world have been close to zero for a decade now. With COVID-19 hitting markets hard, rates are likely to remain low for much longer. This leaves bond funds chasing gains to look into emerging markets for investments. As such, all funds that want gains have turned to the emerging markets, and the result has been a consistent increase in the value of EMB over the past few months and the positive outlook on the fund by options traders.

    Central Bank interventions in emerging economies

    The COVID-19 pandemic has ravaged the world economy, and weak emerging economies have borne the brunt of it. As such, their central banks have had to take measures to protect economies, and that includes foreign borrowing. Due to the weakened economies, most of them have had to borrow at rates that are much higher than the rest of the markets. This has created an opportunity for investors to make superior gains on such bonds despite the challenges posed by the COVID-19 pandemic.

    Dollar-dominated bonds

    There are two types of emerging markets, namely those dominated in local currencies and those dominated in dollars. Due to the higher risks in these markets, foreign investors go for dollar-denominated bonds. Due to the economic weakness caused by COVID-19, most emerging economy currency have weakened against the dollar and this favours investors in dollar-denominated bonds.

    About iShares J.P Morgan USD Emerging Markets Bond ETF

    iShares J.P Morgan USD Emerging Markets Bond ETF is a USD denominated index tat that tracks emerging markets bonds.

  • Stocks to Watch as Bulls Take Charge in U.S Equities

    Stocks to Watch as Bulls Take Charge in U.S Equities

    The U.S markets are headed for a good start to the day with the NASDAQ, Dow, and the S&P 500 all in the green in early morning trading.  This is a reflection of the mood across the world where stocks are largely in positive territory today.

    This follows increased optimism for a stimulus package deal for the world’s largest economy. Earlier in September, the Federal Reserve had indicated that a fiscal stimulus package was needed as it had exhausted all monetary policy options for holding the economy together. Despite the improved outlook, investors are still cautious about the impact of COVID-19 on the economy.

    Recently, the number of deaths from the pandemic crossed the 1 million mark. The numbers keep rising too and some countries such as Spain have gone back into lockdown. In the U.S, major corporations such as Disney have announced they are laying off thousands of Staff due to the pandemic.

    The delicate situation is made even more complex by a highly divisive election in just a few weeks. Despite the complexities in the market, there are stocks that are gaining quite strongly and could trade in positive territory all through the day. Some of the stocks to keep an eye on today are as below:

    Enlivex Therapeutics Ltd [NASDAQ: ENLV]

    Enlivex Therapeutics Ltd is a top performer this morning and is up by over 70% pre-market. This follows the company’s announcement that it had got positive results for its COVID-19 treatment called Allocetra in critically ill patients. The trial included 5 people in critical condition who were released after 5.5 days and 8/5 days respectively of using Allocetra. The company also announced that there were no cases of severe side effects related to the use of Allocetra™. The company stated that if the treatment is approved, it would bridge the gap in the treatment of severe and critical COVID-19 patients.

    American Equity Investment Life Holding Company [NYSE: AEL]

    This is another top perfumer this morning and is up by over 50%. This momentum comes just a day after the company announced it had named Graham Day to lead Eagle Life. The company stated that Graham was bringing in two decades of experience in sales leadership to the company. The move has excited the market if the current price action is anything to go by.

    Advanced Emissions Solutions Inc [NASDAQ: ADES]

    Advanced Emissions Solutions Inc is a top performer pre-market and is up by over 40%. This follows the company’s announcement that it had entered into a 15-year activated carbon supply deal with Cabot Corporation.

  • Houston Energy Corporation [HUSA] Still In a Buy Zone after Bullish Breakout

    Houston Energy Corporation [HUSA] Still In a Buy Zone after Bullish Breakout

    Houston Energy Corporation [NYSE: HUSA] is in an interesting zone right now. It was in a breakout two days ago, and while short sellers have tried to drive the price down, overall momentum remains bullish. At the moment, downside pressure is driven by a decline in demand for oil due to the COVID-19 pandemic. However, this is temporary as the world is inching closer to a vaccine. Once there is a breakthrough, the demand for oil and gas will rise, and Houston Energy is prepared for it. In early September, the company issued a statement that showed that it was investing in anticipation of an increase in demand. Among some of the oil and minerals, developments likely to play a role in its long-term value are as below.

    Completion of the Well in Yoakum County

    There have been some excavation activities at the Yoakum County, TX. The well called the Frost #2-H has been an ongoing project that is projected to have some promising outcome. Houston Energy expects the well to go on production starting this week. The company owns about 18.6% of the working interest in that well.

    Increasing Acreage in Hockley County, TX

    Houston also owns another mining area in Hockley County, TX. Recently, the company has increased this mining block to 6,336 acres up from 5,871 with Houston Energy owning a good 20% of the block. The company is now preparing to begin drilling operations that are set to begin around September 18, 2020. According to the operators’ projections, the depth of the well-drilled here will be about 10,500′ with a lateral length of about 5,224′. These are just the projected measurement to guide the drilling process.

    When the above factors are coupled with an increase in positive sentiments in equity markets, this stock could be one of the big gainers in the remainder of 2020, and possibly all through 2021.

    About Houston Energy Corp Inc

    Houston American Energy is an exploration and mining company based in Houston Texas. It deals with oil, natural gas, and minerals exploration and mining mainly on the Permian Basin, on the onshore Gulf Coast Region in Louisiana and Texas.

    The company also has contacts and concessions allowing them to operate in the South American country of Colombia. It was incorporated back in 2001 as an oil and gas exploration company dealing with both production and non-production assets. It has since been forming partnerships with other players in the industry in a bid to spread costs and maximize returns.