Fibrocell Science FCSC - Taking one large step forward
Fibrocell Science FCSC - Is a position I have had for quite sometime now and is a great value at the current 15 - 17 cent price range. I thought I would provide some clarification since a lot of investors are incorrectly interpreting the recent news surrounding the company. The recent private placement deal is a huge positive for FCSC investors because of the following reasons:
Private Placement - NRM VII Holdings I, LLC, a Third Security, LLC affiliated fund and other investors purchased 450 million shares at 10 cents per share worth a total investment of $45 million. When you take into account that FCSC currently has about 100 million shares outstanding, the new investors are valuing the company at $55 million. This means that the pre-deal market cap of $15 million is way undervalued.
Debt - Concurrent with the deal the company will be converting part of it's debt into equity with the rest being paid off from proceeds of the private placement. FCSC will thereby be debt free upon completion of the deal. This is huge for FCSC investors since this removes the risk of bankruptcy in the near term. Debt is the biggest risk to growth companies in the early stages due to the lack of cash flow.
Up-Listing - FCSC recently got approval to effect a reverse stock split of the outstanding shares of the Company's common stock, prior to July 31, 2013, if the Board believes such action will facilitate the listing of the Company's common stock on a national securities exchange. I'm not a fan of reverse stock splits but I'm a huge fan of up-listing to a national exchange. This should bring in new investors that will increase market cap.
Partnership - We will be receiving more information regarding the partnership with Intrexon shortly but I expect FCSC to benefit by getting access to new IP that should improve manufacturing production as well as further the development in clinical trials.
Institutions are accumulating a position which is evidenced by the sudden and large increase in volume over the last few days. You have to think like a institution here and accumulate along with the big investors. I will hold on to my current position but will look to add to it once we get confirmation of the up-listing, afterall the company was nice enough to give us a target date which is before July 31, 2013.
FCSC is in my highly speculative portfolio so be sure to do your research.
Can Nasdaq Make A New High?
I have been unable to update my opinions and trades the last few days but will try to post more often. This is a very busy time of year for my other businesses and was unable to post. Anyway back to the market.
The Nasdaq (QQQ) is in a very interesting location.
The market experienced a very sharp sell-off which I marked with the yellow arrow. I was actually hoping for more of a continued move down to retest the $50 which I was looking to buy. The $50 area is a very strong support area that the market has failed to break over the past 3 months. The Nasdaq has since reversed course and is threatening to take out a key pivot at $57.50. I marked this area with a blue arrow.
I believe Nasdaq may be setting up to make a new high. Now the QQQ is holding right above the daily 200ma. An aggressive trader could take a small position if QQQ were to break and close above $57.50. The real test is the resistance area close to $60. The QQQ has tried to break above the $60 mark about 3 times now.
If the market can break above and hold $60, I expect to see a very sharp move to the upside when that happens. The market is still very volatile so I wouldn't set a long term bias until I see $50 or $60 break. This is an environment for trading so I would stay nimble.
New Blackberry Phone, Code name London
The device is rumored to be the first phone than would be running on the new Blackberry QNX operating system. It is expected that the new device may launch late next year. The new Blackberry is rumored to have the following specs:
1.5 GHZ dual core processor
1 GB of RAM
16 GB onboard storage
8 megapixel rear camera
2 megapixel front camera
It looks like Blackberry has finally gotten on board the band wagon and redesigned its original design. I believe RIMM is finally getting the picture and heading in the right direction. The question is, are the new QNX devices enough to turn the company around.
Source: The Verge
Groupon Fastest Growing Company In History
Groupon already has been called the fastest growing company in history.
In Groupon’s second full year of business, 2010, it pulled down $713.4 million in revenue, according to its IPO filing. The revenue a year earlier was $30.47 million. That’s a growth rate of 2,241%. Yes, you read correctly.
(Groupon’s “revenue” is the amount of money a consumers pays for a Groupon offering. Gross profit, or the money Groupon actually retains after sharing revenue with its merchants, was $280 million last year and $10.9 million the year before. That an even faster rate of 2,462%.)
Here is a look at how other hot tech companies, including Google and Amazon.com, grew in their earliest years. Groupon puts them to shame.
Google, 2004 IPO
2000 revenue (first full year): $19.1 million
2001 revenue (second full year): $86.4 million
Growth rate: 352%
Amazon.com, 1997 IPO
1996 revenue (first full year): $15.7 million
1997 revenue (second full year): $147.8 million
Growth rate: 838%
Salesforce.com, 2004 IPO
2002 revenue (first full year): $22.4 million
2003 revenue (second full year): $50.99 million
Growth rate: 128%
(Note: for years ended Jan. 31, 2002, and Jan. 31, 2003)
eBay, 1998 IPO
1997 revenue (first full year): $5.7 million
1998 revenue (second full year): $47.35 million
Growth rate: 724%
iPad 3 Launch
Now that the iPhone 4S was launched consumers are now waiting for the new iPad 3 to be released. We can assume that the iPad 3 will launch in spring 2012. Asian sources estimate that the launch could happen during March next year at the earliest. I expect the launch to happen closer towards the middle of next year.
One of the challenges in determining the launch date is Apple's dominance in the tablet market. Many companies launch a new product to compete a competitor. There are no tablets that are currently able to compete with the iPad 2. Apple's recent earning show that iPad 2 sales have increased 146% to $2.8 billion compared to the same period in the previous year. Apple sold 11.1 million iPads which marks a 166% increase over the previous year.
The lack of competition may push Apple to delay the lauch to later in the year to allow the company to further maximize iPad 2 sales.
The iPad 3 is expected to have the following:
- Retina Display: People were expecting a retina display with the iPad 2; but the iPad disappointed them with the same display of the previous iPad. Now followers are waiting for an iPad 3 with a retina display. There is a rumor that the iPad 3 may offer a resolution of 2048×1536 pixels.
- SD Card Slot: People are expecting a revolution in Apple iPad 3 with an SD card slot. Hopefully Apple may introduce SD card slot with the third generation iPad.
- Improved HDMI: Yes iPad 2 also supports HDMI playback but you need to have Apple digital AV adapter, and that comes at an additional cost of $39. So it is much expected from iPad 3 to have an HDMI port that eliminates additional requirement of the HDMI cable.
- Camera Flash: A camera with flash is a much-waited feature of the iPad; people were expecting iPad 2 to have camera flash; now we would be wondering if iPad 3 will have camera with flash.
- Thunderbolt: The iPad 3 may have a Thunderbolt port. That will offer power, video and data connectivity using the same connector at lightning speed.
- Wireless Synchronize: People are expecting iPad 3 to offer wireless sync of content rather than the traditional wired connectivity.
The Nasdaq (QQQ) Continues To Follow Through
The Nasdaq (QQQ) continued to follow through the last two days holding the pivot point we have been watching. We need the market to create a new high which I marked with a yellow line in the chart. We need a new high to ensure that the current bullish trend is still intact. If the market were to fail to create a new high then it would be at risk for a possible sell-off.
Nasdaq (QQQ) still Bullish
The market bulls felt some pressure over the last few days after experiencing a hard selloff . I turned bullish on the nasdaq when it broke above the high the of trading range. It is not uncommon for the market to pullback after breaking above a tough resistance point. You have to remeber to follow the signs the market gives us. The last pivot point held after a retest and so far looks like it is heading higher. I marked this retest with a yellow arrow. I will not turn bearish on the market until the $50 support level is broken. If the lows break after this much of a move I would expect a large move down. I would then look to short the market heavily at that point. I will remain bullish and follow the market trend until I see signs of change.
Close Avon (AVP) Position
I'm closing the AVP position even though it hasn't stopped us out or hit our target. This taking way to long to move. Avon should have popped much faster if it wanted to rally. We are better off looking for another play. Avon is pretty much near our entry price so it's a break even trade.
Book Some KONA profits
We hit $7, book some profits, we got a 40% move in one day. Nice ride from $5.20 I have a big target of $7.50-$8 which is a retest of the pivot. I expected to get this move over several weeks and we got it in a day.
Kona Grill (KONA) close to triggering
I'm looking to buy KONA above $5.20 with a stop below $4.70. This is a trade off the weekly chart so it could last several weeks. I'm looking to take profits around $7.50, near the most recent pivot high on the weekly chart. If the stop gets taken out before our entry then the trade is invalid.
Check out my Kona Grill (KONA) fundamental lesson on Seeking Alpha.