Scroll to top



Morning Rounds: Is it time to jump into biotech?

What a year 2019 has been so far! We began the year with a bang. Biopharma M&A was has been front and center following BMY’s proposed $70 Billion USD acquisition of CELG. This seems to have triggered others to spring to action, as Eli Lilly announced to buy Loxo Oncology for about $8 Billion USD in cash thus gaining access to a portfolio of targeted medicines to treat cancers. This offer was about 68% premium of Loxo's Friday close at $235/share. Despite slowing topline growth and significant post-tax reform firepower for numerous large-cap biopharma companies which supports M&A potential, one must point to the stock reactions for recent acquirers, notably GSK (-8% post TSRO offer), BMY (-14% post CELG offer) and LLY (-2% post LOXO offer). While this may be true, we still remain optimistic for M&As to continue in 2019, we urge you to consider drug pricing uncertainty in addition to recent volatility into your models.  In light of this M&A theme following the BMY/CELG announcement, we recommend keeping an eye on following the capital allocation commentary from AMGN, BIIB and GILD. Below, we provide our guidance on our top watchlist for the month of January. Specific dates and catalysts are provided for the following stocks,  SRPT, INSP, SLDB, EXEL, and IMMU. 

By Dr. Tiam Feridooni

January 7, 2019

2018 Year-End Stock Market Review | Are We Headed for a Recession in 2019?

We ended 2018 on a rollercoaster ride of emotion. The year ended with the notion that the markets have priced in lower economic growth, which has been a key driver for the recent sell-off in the markets. Subsequently, this has resulted in increased concerns of investors and expectation for a recession in 2019. About half of the US CFOs expect recession by end of 2019. Furthermoreforecastersrs see a decline in the GDP in the next year, which make the next few quarters telling of the fate of the markets. Historically, there have been more than 30 instances of US recession since the mid-1800s. Majority of the cases prior to the World Word 2 (WW2)-era have been attributed to the financial sector. However, a majority of the post-WW2 recessions have been secondary to monetary policy tightening and oil, in addition to sentiment0driven swings in borrowing and investment. Furthermore, historically, rate hikes - attributed to high inflation - and rapid tightening has subsequently ended in a recession.

By Dr. Tiam Feridooni

January 2, 2019

2018 Year-End Stock Market Review | What to expect from Bitcoin in 2019?

You have to ask, was 2018 a dream? When it comes to the cryptocurrency space, it certainly felt that way. The space became vastly popular as it began to get traction from all sorts of investors. CNBC had a Bitcoin Watch ticker on the bottom right of the screen that kept up with the second-by-second price change. Various "experts" would provide their "insight" into the cryptocurrency space. Most famously, one suggesting that retail investors buy Ripple (XRP) essentially at its ATH price. Looking back at the chart, you can say that in 2018 the Bitcoin Bubble burst. In 2018, the overall market capitalization of the overall cryptocurrency space went from just above $800 billion USD to $130 billion USD at the time of writing this article. That is more than an 80% drop in the overall market capitalization of the cryptocurrency space. This tops the dot-com bubble where we saw the NASDAQ drop about 78% in just two years.

By Dr. Tiam Feridooni

December 31, 2018

Morning Rounds: Shorting Snapchat and Teva Pharmaceuticals

<p>I decided to rebrand the website for 2019. It will still consist of the same features, just renamed and rebranded. I hope that Santa has been kind to everyone. Looking at the markets you'd think that all the major indices were on Santa's naughty list. With SPY, DOW and NASDAQ essentially all in the bear market territory... and it seems that the Trump administration just can't keep their foot out of their mouth for just one day...  With recent meddling of Mnuchin and his poor attempt to calm the markets resulted in the exact opposite effect, essentially leaving most institutional investors "totally baffled". His comments resulted in the DOW closing down 2.9%, SPY down 2.7% and NASDAQ down 2.2%. It wasn't long ago that we were talking about "DOW 30000!" and just months later we're back to 21k. </p>

By Dr. Tiam Feridooni

December 25, 2018

Weekend Rounds: Focusing on Regulated Utilities | Water stocks Part 1

<p>This past week I have become interested in Utilities, more specifically, Water stocks. If you're asking why or how would you invest in water then keep reading. If you're wondering why would you invest in water, then let me explain. There is an increasing demand for water for various purposes such as personal, commercial and industrial use. Water is used to generate power in the majority of global power-generating entities and it is used extensively in agriculture. Freshwater supply is increasingly declining and the world population is increasing. There is no doubt that there is an investment opportunity here. The water issues of Flint, Michigan may no longer be present in the News cycles, but I assure you they still haven't solved the city's water problem. Americans, among other countries with scares water supply need to wake up and realize that there is going to be significant scarcity in the coming decades. Sticking to the US alone, recent water quality reports have indicated that about half of US streams, akes and one-third of bays are polluted. Every year there is about 4 trillion Litters of untreated sewage, industrial waste and groundwater are introduced to US waters. The "quick shower" that we've become accustomed to every morning uses more water than a person would use in the whole day in a developing country. Get the picture? There is increasing demand, decreasing supply.</p>

By Dr. Tiam Feridooni

December 17, 2018

What does the Allergan Implant Debacle (BIA-ALCL) Mean For Sientra?

It is hard to imagine that breast implants could cause cancer. It is even harder to imagine that they can cause other symptoms such as alopecia, fogginess, irritable bowel syndrome, pain, and migraines. Well, there has been a slow and steady build-up of evidence that suggests that specific type of breast implants - textured - can increase the risk of a specific rare form of cancer. Use of textured implants has been shown to be associated with a form of cancer called Breast Implant-Associated Anaplastic Large Cell Lymphoma (BIA-ALCL). Perhaps, the 47-year-old Edmonton woman who was recently featured in several news articles is a rare case, however, no one who has undergone a double mastectomy - for the eradication of risk of breast cancer - should then develop breast cancer due to the implants. However, this news was accompanied by others like her, such as the 44-year-old Terri McGregor, who ultimately required eight rounds of chemotherapy after doctors discovered that not only had her implants ruptured, but they had also provided grounds for cancer to metastasize from her capsule to lymph nodes and abdomen. Here we compare the three manufacturers of breast implants, Sientra, Allergan and Mentor.

By Dr. Tiam Feridooni

December 10, 2018

What can the US-China Trade War Ceasefire Mean for Stocks

<div dir="ltr"> <div id="Content"> <div id="Content"> <div dir="ltr"> <div id="Content"> <div id="Content"> <strong>The S&P 500 extended last week's rally by 1.1% on Monday, as investors breathed a sigh of relief that U.S.-China trade relations did not worsen over the weekend. Meanwhile, the Dow Jones Industrial Average gained 1.1%, the Nasdaq Composite gained 1.5%, and the Russell 2000 gained 1.0%.</strong> </div> </div> </div> <div dir="ltr"> <div id="Content"> <div id="Content"> President Trump and President Xi agreed at their Saturday dinner meeting to delay further tariff actions for 90 days, during which time further negotiations will be carried with an aim of trying to settle disagreements over fundamental trade issues. National Economic Council Director Larry Kudlow told reporters the 90-day clock will start with the start of the new year and expects changes across a broad range of issues to happen "very quickly." <span style="font-size: 1rem;">Stocks retreated from their best levels, though, reined in by an underlying sense that the morning's positive reaction to the Trump-Xi agreement to suspend further tariff actions was probably an overreaction since nothing concrete was achieved in terms of resolving the most important fundamental trade issues between the two countries. Also, the spirit of moving the tariff rate to 25% (from 10%) on $200 billion of Chinese goods continues to hang there </span>like<span style="font-size: 1rem;"> a stick in the event an acceptable deal to the U.S. is not struck within the 90-day deadline. What does this 90-day cease-fire really mean? Perhaps, it provides the grounds for some fruitful discussion between the two parties. </span> </div> </div> </div> </div> </div> </div>

By Dr. Tiam Feridooni

December 4, 2018

Advance Auto Parts (AAP): Slow and Steady Growth Expected

<img class="alignright size-medium wp-image-3895" src="" alt="Advance Auto Parts stock analyis" width="300" height="70" />A new addition to our focus list is <strong>Advance Auto Parts (AAP)</strong>.  Most perceive the auto parts as a necessary but mundane industry that typically experiences slow growth. But the business remains a solid one. Cars always break down, and consumers will almost always buy new parts when necessary regardless of the shape of the economy. Also, let’s face it — most shoppers in this industry focus more on getting their car working than on finding the lowest price. Hence, Advance and peers often avoid the intense price pressure faced by other types of retailers.<b></b>

By Dr. Tiam Feridooni

November 30, 2018

Stocks continue to tumble as they follow Tech

The S&P 500 tumbled 1.7% on Monday, as a rout in widely-held tech stocks led the broader market lower. A lack of leadership and the continued inclination to sell into strength have translated into a lack of buying interest. Meanwhile, the Dow Jones Industrial Average dropped 1.6%, the Nasdaq Composite dropped 3.0%, and the Russell 2000 dropped 2.0%. The S&P information technology sector (-3.8%) was the main problem on Monday.<strong> It has been prone to liquidation efforts that have aimed to reduce exposure to a crowded sector running into concerns about a cyclical slowdown, valuations, and increased regulatory scrutiny. The tech group leads all 11 S&P sectors lower in November with a monthly loss of 5.5%.</strong>

By Dr. Tiam Feridooni

November 19, 2018

Aurora Cannabis (ACB) Earnings Analysis and Price Prediction

The S&P 500 lost 0.9% on Friday, with the pullback suggesting a natural consequence of an overreaction to this week's election spike. The Dow Jones Industrial Average lost 0.8%, the Nasdaq Composite lost 1.7%, and the Russell 2000 lost 1.8%. For the week, the S&P 500 advanced 2.1%. Aurora Cannabis (ACB) reported Monday fiscal first-quarter net earnings that rose to $105.5 million from $3.6 million a year ago, and from $79.9 million in the previous quarter. Total revenue rose 260% from a year ago and 55% from the previous quarter to $29.7 million, while cannabis revenue jumped 236% from last year and 65% from last quarter to $24.6 million. The average selling price per gram of dried cannabis grew 15% from a year ago to $8.39, while the cash cost per gram fell 12% to $1.90. For cannabis extracts, the net selling price per gram fell 26% to $12.12, while costs declined 22% to $1.45. Active registered patients rose 250% to 67,484.

By Dr. Tiam Feridooni

November 12, 2018

Cannabis Stocks Soar as Jeff Sessions "Resigns"

<img class="alignright size-full" src="" width="300" height="135" />The S&P 500 confidently finished with a gain of 2.1{d745bfe1f0a8cfaf7934723e820c1a1fdf298af2e9634a8abb073c3029806a15} on Wednesday with the benchmark index now up 6.4{d745bfe1f0a8cfaf7934723e820c1a1fdf298af2e9634a8abb073c3029806a15} since its close on October 29. Wednesday's advance follows the conclusion of U.S. congressional midterm elections that produced a split Congress. The prevailing assumption in the market was that a newly divided Congress would preserve market-friendly policies, namely the tax cut and deregulation efforts. U.S. President Donald Trump also mentioned on Wednesday bipartisan efforts to work with the Democrats in the House on infrastructure, trade, and lowering drug costs. Meanwhile, the Dow Jones Industrial Average gained 2.1{d745bfe1f0a8cfaf7934723e820c1a1fdf298af2e9634a8abb073c3029806a15}, the Nasdaq Composite gained 2.6{d745bfe1f0a8cfaf7934723e820c1a1fdf298af2e9634a8abb073c3029806a15}, and the Russell 2000 gained 1.7{d745bfe1f0a8cfaf7934723e820c1a1fdf298af2e9634a8abb073c3029806a15}.

By Dr. Tiam Feridooni

November 8, 2018

Stocks Continue to Struggle in light of Trade Concerns

Stocks fell on Friday following conflicting US China trade reports and softer-than-expected sales guidance from <strong>Apple</strong> <strong>(AAPL 207.48, -14.74, -6.6%).</strong> Futures rallied overnight on a <em>Bloomberg </em>report indicating U.S. President Trump asked his cabinet to draft a trade deal, but stocks eventually fell into negative territory after White House officials denied the report. The<strong> S&P 500 lost 0.6%, the Dow Jones Industrial Average lost 0.4%, and the Nasdaq Composite lost 1.0%. Small caps outperformed, with the Russell 2000 adding 0.2%. All four major indices closed solidly higher for the week, adding between 2.4% and 4.3% apiece.</strong> Director of the United States National Economic Council Larry Kudlow confirmed in a <em>CNBC </em>interview that the cabinet was not asked by President Trump to draw up a trade plan for China. Later, as stocks traded at session lows, President Trump reiterated his belief to reporters that the U.S. will reach a trade deal with China. This led stocks to cut their losses in late afternoon trading.  

By Dr. Tiam Feridooni

November 5, 2018