SaltyCajun.com http://www.geaux-outdoors.com/

Notices

Go Back   SaltyCajun.com > Hobby Forums > The Trading Floor (Investing, Stocks, Bonds)

The Trading Floor (Investing, Stocks, Bonds) Discuss investing and investments here! Do your own due diligence before investing. We are not responsible for any advice or recommendations within this forum!

Reply
 
Thread Tools Display Modes
  #1  
Old 03-28-2011, 08:19 AM
"W"'s Avatar
"W" "W" is offline
Catch fish in DA face!!
 
Join Date: May 2009
Location: Big Lake LA
Posts: 32,974
Cash: 7,829
Default Stong Buy...Looking good (PRAN)

Prana Biotechnology Ltd (PRAN)

http://www.barchart.com/quotes/stocks/PRAN



This last week brought an interesting move in shares of Prana Biotechnology Ltd. (NASDAQ: PRAN). On Friday we gave this coverage right at the open noting at 24/7 Wall Street that the stock was still worth a look for speculators despite a news pop followed by a capital raise that hurt the stock’s gain during the week. This ADR is of a company based in Australia and its focus is Alzheimer’s, Parkinson’s, and Huntingston’s Diseases. It is highly speculative by any measurement. Prana effectively has no revenues and our take is that it will be highly reliant upon grants from governments, agencies, and other foundations and organizations or it will have to rely upon the capital markets or a partnership for more funding down the road.

The company saw shares surge earlier in the week on reports that data was being published in the science journal PLoS ONE with the title “Metal Ionophore Treatment Restores Dendritic Spine Density and Synaptic Protein Levels in a Mouse Model of Alzheimer’s Disease.” Its PBT2 was shown to have repaired damage in an Alzheimer’s affected brain and that facilitated the restoration of cognition in Alzheimer’s Disease.

Then came news from the company that it was raising capital in Australia to the tune of $6.1 million (Australian Dollars), a move which investors often consider as pump and dump capital raises. What is interesting though is that right after we published “Still Worth a Look for Speculators” we saw an immediate 10% rise in the stock. Shares went from $2.78 or so up to $3.10 in very short order and then the stock rose again in a second leg up to as high as $3.34 before closing at $2.86 for a near three percent gain on the day. Prana ADRs were under $1.50 before it published the news on Monday and shares closed at $2.86 on Friday, nearly a double for the week. We also saw shares hit a high of $4.50 on Tuesday and that was on a whopping 36.4 million shares that day. This was previously unheard of trading volume in a single day and there are many days where the stock has traded only a few thousand shares. The 52-week range is $1.09 to $4.50 and this stock once traded above $6.00 per ADR back in 2004 or 2005.
We would note that StockCharts.com offers a full gallery review for the charts on Prana, and its Point & Figure price target objective is all the way up at $7.50. That figure will change through time and was based upon March 25 prices and volume.
So, even at the low of $1.09, you may wonder why we call Prana an opportunity for a ten-bagger with that implied upside of 1,000%. Shares have never traded above $10.00 for its ADRs and technically this stock would have to rise to well above $11.00 before we could legitimately call this a ten-bagger. The whole issue surrounding the stock is that even at $2.86 the company’s market cap is a mere $69.2 million before considering the effects of its capital raise. For these ADRs to rise this high in ten-bagger land it would imply a market capitalization rate of what is still only about $266 million.
We believe that the company will continue to need more funds ahead in the coming months and years and it seems logical that the company will raise capital each time its shares rise significantly. There is no way to know yet whether PBT2 is going to be the Holy Grail or whether it will be yet another disappointing flash in the pan. The company noted, “After 11 days of treatment, the brains of the Alzheimer’s mice showed a statistically significant increase in the numbers of spines on the branches (or dendrites) of neurons in the hippocampus, a memory centre specifically affected in Alzheimer’s Disease.”
What we do know is simple. If it turns out that Prana has the next new real treatment candidate for Alzheimer’s, even a $266 million market cap will sound very small. It could quite literally end up being an “Off To The Races” scenario for investors. A Big Pharma company could either become an acquirer or it could become a partnership opportunity. Again, this is all around speculative analysis rather than using true fundamental and financial analysis based solely on today’s finances. There are no real US firms which cover Prana so we have no real benchmark to judge what could happen in just a bullish scenario rather than a runaway scenario. The company has a single research report posted on its site from 2009 by Southern Cross Equities and it is very bullish with a title “Unforgettable Opportunity” from that time.
Looking at potential ten-baggers is not for widows and orphans. After all, we are talking about study results conducted on mice and on a company which will need significant funding ahead by our count. A large partnership or other liquidity event from a Big Pharma player could also bring rewards and also bring risks down the road. Many companies rise on news and end up in a flame-out situation. All of the magic characteristics are in place for a possible ten-bagger scenario, and all of the risks are in place as well. Time will be the judge as to whether or not Prana will end up being he next ten-bagger in biohealth.
Here is that data published in PLoS ONE.
Reply With Quote
  #2  
Old 03-28-2011, 10:12 AM
"W"'s Avatar
"W" "W" is offline
Catch fish in DA face!!
 
Join Date: May 2009
Location: Big Lake LA
Posts: 32,974
Cash: 7,829
Default

Bought in heavy at 2.82....Just let it touch ...3plus...
Reply With Quote
Reply

Bookmarks

Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off

Forum Jump


All times are GMT -5. The time now is 09:12 PM.



Powered by vBulletin®
Copyright ©2000 - [ARG:3 UNDEFINED], Jelsoft Enterprises Ltd.
vB.Sponsors
vBCredits v1.4 Copyright ©2007 - 2008, PixelFX Studios
SaltyCajun.com logo provided by Bryce Risher

All content, images, designs, and logos are Copyright © 2009-2012,
Salty Cajun, LLC
No unathorized use is permitted
Geo Visitors Map