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I wanted to put out a brief note for premium subscribers in light of recent trading activity.
As I’ve mentioned many times recently in the newsletter, this is a trader’s market. This was reinforced recently with both ATOM and INAB selling off after big moves on (or into) good news. While I’m a long term investor at the core, I have been taking advantage of this volatility in my trading account.
The bottom line here is that, right now, it pays to play catalysts. As such, my trading account is positioned for several that I believe are coming soon. The three positions owned in this account are Spectra7 (SPVNF), IN8bio (INAB) and INmune Bio (INMB). I’d like to discuss the rationale behind each position briefly.
INmune Bio (INMB) is my top pick over the next six months. We have numerous catalysts coming in the second half of the year and I think shares will be substantially higher by year-end. Here’s a list of the upcoming events that I think will move the stock.
June: I’m hopeful we see insider buying. I have pushed the board hard (and it was reflected in voting, thanks guys!) to get broader participation. I’ve been told they have reached a “creative solution” to my emails. This implies, to me, that we’ll see something along the lines of what happened the last time insiders bought in a big way; a direct investment into the company. Fingers crossed that I’m right and that this is meaningful.
Q3: we should see another jurisdiction (Europe? Japan?) approved for the AD trial. This will be big as it will ensure that they have enough potential enrollment to meet the expected trial date.
Q3: should also see data from their INKmune trial in AML. Dosing is finally accelerating and data could be a nice catalyst. This program is completely off investors’ radar screens and, if the next few patients are positive, could have a dramatic impact on the stock.
Q4: start of the INKmune trial in prostate. A minor catalyst, but incrementally positive and should keep the company’s momentum going.
Q4: a partnership in DMD. This is a wildcard but, if it happens, the stock could make a massive move. Other programs in DMD have received large upfront cash plus hundreds of millions on the backend. If INmune gets anything along those lines, the stock is flying.
Q4: data from the AD extension trial. This has the potential to be highly significant. While investors wait for the removal of the FDA hold, I think they are missing the fact that INMB continues to dose patients and will have meaningful data from these patients to present later this year.
Q4: finally we get the biggie, which is removal of the FDA hold. While this is expected, it is a game-changing event as many (MANY!!!) funds refuse to touch a company with an FDA hold. The immediate action should be positive, but the longer-term should see many new institutions buying into INMB.
With those seven catalysts, INmune is my top pick for the second half of this year. It’s been my largest holding for quite a while now. However, I believe the timeliness ranks up there with the days prior to the phase 1 data release, when the stock went from $5 to over $30. If all of these hit, it should do even better than that.
IN8bio (INAB) sold off after ASCO. A couple of reasons for this, the primary one being it remains a trader’s market and the known catalyst is now behind the company. Also, I believe the company tapped their ATM again. To what extent, I’m not sure.
As I mentioned in my last update, I’m going to ride out the volatility in this name. The data presented was excellent and I believe IN8bio is going to be a very big stock as the story keeps getting stronger. The post ASCO selloff is simply a pause before the next move (one I should have traded in hindsight). Upcoming catalysts are more data later in the year and a hoped for partnership (which would be game-changing here).
I think the stock has bottomed and believe it will resume its upward momentum once we get some visibility into the next catalysts. Once they stop hitting the ATM, should be clear sailing here. We have a Zoom meeting with INAB next Thursday which should hopefully provide a lot of clarity into what the future holds.
Spectra7 (SPVNF) is trading higher of late, approaching resistance of $.73, where the last offering took place. We need a catalyst to break through. That catalyst would be announcing a design win with a major North American database operator, like Microsoft (who we know to be testing their equipment).
I’d like to draw everyone’s attention to the move that CRDO has had the last week or so. This as they have done a good job of convincing investors that they are a beneficiary of the AI boom. We all know Spectra7 is positioning their Active Copper Cable as a better choice than Credo’s Active Electrical Cable.
If Spectra7 does start to get some design wins, we could see a massive move upwards. Credo has gained $1B in market cap recently. Winning a fraction of the business, with a current $25M market cap, would send Spectra7 up multiples, quickly.
I believe SPVNF is going to announce a win sometime in the next few months and that the stock will make a major move when this happens.
The other names I’m watching for a timely opportunity to back up the truck are the following:
TFF Pharma (TFFP) I want to be there for phase 2 data. This seems like a Q4 event the way things are shaping up. As such, with a weak balance sheet, I’m holding off on buying more here.
enVVeno (NVNO) The data from their trial should be coming in Q1 of 2024. In the short-term oriented world we live in, the time to get big here is around year-end.
Atomera (ATOM) I will likely buy back this stock in my trading account later this year. Tough to know when to do so, thus I’m content to own others with known catalysts. That said, I think this will have a huge move on the next big announcement. One was great, two makes this a platform opportunity.
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