Today’s stock pick is one Speculative Biotech Stocks, Agenus (AGEN) which closed, September 30 at $9.93.
As we have stated earlier, new Biotech companies are Very Risky…..usually they have only 1 or 2 drugs in clinical trials and if those drugs don’t get approved by the FDA, the stock can plummet, and you can lose all or most of your investment. But, if the drug is successful, and becomes a blockbuster drug, you can make a lot of money. Besides that risk, we believe that we are in the beginning stage of what could be a Devastating Bear Market – and most stocks decline in a Bear Market.
Some stocks will still go up, at least in the beginning. In a Bear Market, if you are trading on Margin, you can lose everything. Get off of Margin.
In the Crash of 1929, people jumped off of buildings because they “Lost It All” and got wiped out, and couldn’t face their families. A Bear Market Comes Like A Thief In The Night…and people refuse to believe it when it’s happening.
So, to be prudent, and get good average prices, I use my Normal Buying Strategy, which is: “Buy 40% of the stock NOW, and Buy 30% more on each 20% decline from your original Buy Price”.
Agenus, Inc (Symbol AGEN) $9.93. I bought the stock on Tuesday in Pre-Market Trading for $9.544 a share. It has a very promising colorectal cancer drug in clinical trials. On September 28, Rodman & Renshaw gave it a Buy Rating, with a $19 Price Target. And on September 18, Chardan Capital Markets gave it a Buy Rating with a $40 Price Target.
If you look at the chart, you can see it had a huge 1-Day move in early July from about $3.25 to $8.50, and then made a two month Consolidation Triangle. It broke out above that Triangle strongly, on the 21st, and at the same time had a Bullish MACD Crossover. Go to Finviz.com to read about their seemingly exceptional colorectal clinical trials. Per Finviz, it has 42.62 million shares outstanding, and a float of 39.91 million shares. 6.80 million shares are short, giving a Short Float of 17.05%- a high number, which makes it a good candidate for a short squeeze. It shows current earnings of $2.65 per share, and next year’s earnings of Minus -$.60 per share. Insiders own 11.64%. Insider trading information was not available. We own the stock and think it’s going a lot higher.
This article is not investment advice and it is not in any way to be construed as investment advice. For Investment Advice consult a Registered Investment Advisor or a Certified Financial Planner. Joe Cotton’s website is www.cottonstocks.net.
Returning as a columnist for the NKyTribune, Cotton is publisher of the market newsletter, Cotton’s Technically Speaking. He is a graduate of Xavier University, a former bank manager and credit analyst, and a former Fidelity Investments registered investment representative. Contact him at cottonstocks@hotmail.com