Companies featured in this edition of the newsletter: CVM, ICLK, IMUC, ITUI, IWEB, MBCI, NXOI, OMCM, ONEZ, PHC, SRCO, SVUL, XCR
Markets closed moderately higher yet again this week, as mostly better than expected economic data helped stave off profit taking to leave most indices in positive territory on the week. All told, the Dow ended the week up 0.4%, closing at 9544, up 38 points, bringing its YTD gains to 8.7%. The Nasdaq also gained 0.4% on the week to close at 2028, bringing its yearly gains to 28.6%, while the S&P 500 gained 0.3% and the Russell 2000 lost 0.3%, bringing their yearly gains to 13.9% and 16.1% respectively.
Economic news was in focus yet again this week in the absence of any market driving earnings data, as new home sales for July rose at 9.6%, posting its strongest gains since 2005. This positive development coupled with last week’s better than expected housing data left many investors speculating that a bottom in the housing market may be near. Positive news was also received in the form of an increase in consumer confidence, as the figures for August rose more than expected, coming in at 54.1, well above consensus estimates calling for 47.9. Labor data left little room for positive interpretation however, as new unemployment claims came in higher than expected and continuing claims fell, but the decline is more likely a reflection of workers exhausting their benefits rather than a rebound in job markets.
In corporate news, Intel raised its Q3 revenue guidance to $9 billion citing stronger than expected demand for microprocessors and chipsets. The company’s previous forecasts were for revenue to exceed $8.5 billion. In other corporate developments, Dell reported a 23% decline in its second quarter profit, but still managed to beat EPS estimates calling for $0.23 per share, posting a gain of $0.28 per share.
What should investors look for this week? Earnings releases will be few and far between, but look for results from Sun Microsystems (NASDAQ: JAVA) on Monday before the bell.
Economic releases for the week begin with Chicago PMI for August, due out on Monday at 9:45 am. On Tuesday, look for July Construction spending, released with the ISM Index for August at 10:00 am, with Truck and Auto Sales following at 2:00 pm that same day. ADP Employment Change is due out at 8:15 am Wednesday morning, followed by Revised Q2 Productivity figures at 8:30 am, Factory Orders for July at 10:00 am, weekly crude inventories at 10:30 am, and FOMC minutes from the August 12th meeting at 2:00 pm. On Thursday, weekly initial jobless claims will be released at 8:30 am, followed by ISM Services for August at 10:00 am. Friday will be a busy day for labor data, as Average Workweek, Hourly Earnings, Nonfarm Payrolls, and the Unemployment Rate, all for August, will be released together at 8:30 am.
Conference schedules will be light again this week, but look for the two-day Morgan Stanley Global Industrials Unplugged Conference beginning on Tuesday in New York, and the three day Lazard Capital Markets Retail & Apparel Conference which is being held in Las Vegas beginning on Sunday.
Volume Alert: Shares of late stage cancer immunotherapy company and the developer of vaccine to treat and fight infectious diseasesCEL-SCI Corporation (AMEX: CVM), surged 48% on almost four times average volume last week on growing concerns regarding the potential threat of swine flu emerging as the traditional flu season approaches. The company recently announced that it had expanded the scope of its work towards creating a novel treatment and vaccination against the current H1N1 virus, as well as future mutations, and has indicated that it expects to provide an update on its operations regarding the current form of the virus within the next month. Shares gained twenty three cents on the week to close at $0.71.
Pioneer Behavioral Health (AMEX: PHC), a leading provider of inpatient and outpatient behavioral health services, announced last week that it has been awarded a contract by the Salt Lake City Veteran’s Administration Medical Center (VA) to provide behavioral health services at the company
s Highland Ridge Hospital in Salt Lake City, Utah. The initial term of the contract is nine months, with six month renewal periods. PHC is guaranteed a minimum of $1.24 million under the initial term, with revenue for each six-month contract extension bringing in $792,000. Highland Ridge will provide the VA with eight psychiatric and detoxification beds. PHC also has the opportunity to receive additional revenue for providing care for patients beyond the allocated beds on a fee-for-service basis. Shares gained sixteen cents on the week to close at $1.58.
Xcorporeal, Inc. (AMEX: XCR), a development stage medical device company that is developing an extra-corporeal platform of products that might be used in devices to replace the function of various human organs, announced last week that it has received notice that its shares will be delisted from trading on the NYSE Amex Exchange. The company plans to seek listing on the Over the Counter Bulletin Board which it feels will offer significant savings resulting from a reduction in fees associated with being traded on a national exchange. Shares lost three cents on the week to close at $0.19.
interCLICK (OTCBB: ICLK), a leading internet advertising network, announced last week that it has appointed Kurt Munzinger as senior vice president of sales for the west coast region. Mr. Munzinger has a decade of proven success at top ad networks including Specific Media and Advertising.com, and will oversee the west coast sales team with an emphasis on driving market development, and establishing new client and industry relationships to continue interCLICK’s rapid growth. He joins interCLICK from Specific Media where as the vice president of advertising sales, west coast, he built out its sales force and grew revenue by 1000% over a three year period. The company is excited to have retained the services of someone with the experience level of Mr. Munzinger and expects that he will be instrumental in implementing the aggressive growth strategy that it has laid out for 2010. Shares lost eight cents on the week to close at $1.80.
IceWeb (OTCBB: IWEB), a storage technology company specializing in Geographic Information Systems (GIS) that provides services to bureaucratic and corporate organizations, announced last week that optional software modules are now available for Iplicity allowing organizations to virtualize underlying storage for Virtual Machines. The Iplicity VM Data Center add-in module, priced at $1,900 is available immediately for Iplicity 2.1 users, and will allow them to virtualize the underlying storage for all of their servers. This latest platform upgrade allows IWEB to capitalize on the growing trend of organizations migrating from physical computer servers to virtual server environments, a more cost effective, time saving and environmentally friendly storage option. Shares gained a penny and a half on the week to close just above $0.095.
Volume Alert: Shares of MabCure (OTCBB: MBCI), a biotechnology company using its proprietary technology to create highly specific monoclonal antibodies (MAbs) for the early detection of cancer, surged 41% on over 14 times average volume last week, following the announcement that it had been featured in the June 4, 2009 edition of BioWorld Today, a highly respected news source within the biotech industry. The company was featured in a cover story titled “MabCure’s Revamped Hybridoma Approach Seeks Cancer Antigens,” and describes the company’s “new take on a classic drug discovery technology,” detailing how MabCure is developing monoclonal antibodies against difficult-to-pinpoint tumor specific antigens for the diagnostics market. The article focuses on the company’s ability to successfully differentiate amongst specific types of melanomas to recognize both advance and early ocular melanomas, and how the development suggests that the MabCure technology could potentially generate antibodies that can recognize early disease in other cancers as well. The article went on to note that MabCure is gearing up for clinical testing in prostate and ovarian cancers and that the company intends to seek a commercial partner in the diagnostic field for those programs. Shares gained thirty two cents on the week to close at $1.10.
OmniComm (OTCBB: OMCM), a leader in integrated electronic data capture (EDC) solutions for clinical trials, announced last week that their EDC tool, TrialMaster(TM), has been selected by Pleiad, Inc., a Cambridge, Massachusetts based Contract Research Organization (CRO) with European operations in the U.K., to provide eClinical services to its customers engaged in two separate studies examining the use of ophthalmic medical devices. The partnership is expected to generate more than $1 million to OmniComm over the next few years, and represents a continuation of an ongoing collaboration between the two companies. Shares remained unchanged at $0.24 on the week.
Volume Alert: Shares of ImmunoCellular Therapeutics, Ltd. (OTCBB: IMUC), a clinical-stage biotechnology company that is developing immune based therapies for the treatment of brain and other cancers, surged 73.6% last week on more than six times average volume, establishing a new 52-week high in the process. At ASCO earlier this year, the company reporting promising clinical data from a Phase I trial evaluating ICT-107, IMUC’s dendritic cell-based cancer vaccine product candidate for the treatment of glioblastoma. Seven of the 16 newly-diagnosed patients demonstrated stable disease with median progression-free survival of 64 weeks, and three of these seven patients have progression-free survival of over two years. The median progression-free survival time of newly-diagnosed glioblastoma patients is historically 30 weeks. Shares rose 41 cents for the week to close at $0.90.
ONE Holdings (OTCBB: ONEZ), an investment company owning majority equity interest in core operating assets in Biotechnology located in the Asia Pacific region, announced last week that it has elected Michael Weingarten as Chairman of the Board. Mr. Weingarten has over 30 years of international business experience, having successfully led a multitude of companies ranging from early stage development to multimillion dollar corporations worldwide while participating in over 40 mergers and acquisitions in his career and raising millions to fund both organic growth and acquisitions. The company expects that his experience and leadership abilities will prove critical as they continue to acquire, fund and grow biotechnology and health-related companies in the Asia-Pacific region. Shares gained seven cents on the week to close at $1.12.
Sparta Commercial Services (OTCBB: SRCO), a nationwide financial services company dedicated to the powersports industry, announced last week that it has entered into a strategic agreement with Armet Armored Vehicles, Inc, a worldwide leading manufacturer of custom designed armored vehicles. Under the agreement, Sparta will offer its Lease Purchase Financing Product to municipalities throughout the U.S. that purchase units from Armet’s line of tactical armored vehicles. Sparta’s Lease Purchase Financing allows municipalities to purchase vital equipment and property through installment lease payments, with no large, up-front cash outlays required. While SRCO remains dedicated to providing financing for the powersports industry, it expects that this latest deal will significantly increase the volume of business in the company’s Municipal Leasing Program which, although originally focused on leasing fleets of police motorcycles, is designed for virtually any type of vehicle, as well as other equipment. Shares lost half a cent on the week to close just below $0.065.
Steel Vault (OTCBB: SVUL), an emerging provider of identity security products and services, announced last week that it has entered into a strategic media and marketing partnership with the Miami Hurricanes and Hurricane Sports Properties designed to increase subscribers for Steel Vault’s services. The partnership includes exclusive in-stadium advertising of NationalCreditReport.com and CanesCreditReport.com powered by NationalCreditReport.com at all Miami Hurricanes regular season home football, baseball, and men’s and women’s basketball games, plus other campus sports including regular season home women’s soccer, men’s and women’s track and field, and men’s and women’s tennis, for a minimum of 80 events. The partnership also includes online advertising at HurricaneSports.com and sponsorship of the daily Official Sports Report sent to season ticket holders and other supporters. The company believes that the partnership has significant marketing and revenue potential as it will greatly expand the awareness of its service offering to a large population at the University of Miami, a world-class academic and athletic institution. Shares remained unchanged at just over $0.24 on the week.
i2 Telecom (OTCBB: ITUI), a leading developer of award-winning patented and innovative high-quality mobile applications and services, announced last week that it has appointed Richard H. Roberson as the company’s Chief Financial Officer. Mr. Roberson has 26 years of experience in business, finance, public accounting and enterprise leadership, and most recently served as Senior Vice President and Chief Financial Officer of Excel Telecommunications, a telecom company based in Dallas, Texas. The company is pleased to have added an industry veteran with as much as experience as Mr. Roberson has, and believes that he will be an invaluable member of the team as they continue to grow their business and transition from research and development to an operating company. Shares gained half a cent on the week to close at $0.055.
SPECIAL SITUATIONS:
Next 1 Interactive (OTCBB: NXOI) $1.85
Since the beginning of the global economic slowdown, many advertisers have begun looking for alternative ways to reach consumers that focus more on return on investment and less on big budget mass marketing campaigns. As budgets were slashed in the wake of the slowdown, advertisers have been forced to shift towards more highly targeted solutions that focus on bringing their message directly to their target demographics without the waste associated with the larger campaigns. Next 1 Interactive is a company that is well positioned to capitalize on the shifting expectations of advertisers looking to maximize their marketing dollars by offering a highly targeted network of media assets centered around the real estate and travel/leisure markets.
The company’s strength lies in its simple, straightforward business model that provides advertisers with a number of options for directly reaching consumers in their target demographics by operating in two divisions, travel and media. The travel division operates NextTrip.com, a travel site that includes professional and user-generated content, social networking, a directory of travel affiliate links, and travel business showcases. The website also offers live 24/7 travel talk radio, travel articles, destination guides, and travel deals, and allows advertisers such as hotels, airlines, cruise lines, and tour operators to place banner ads and showcases, providing a highly targeted advertising opportunity to marketers by connecting them with consumers interested in their businesses who are actively seeking the very opportunities that they are marketing. The media division operates a 24 hour digital cable TV network that provides advertising solutions for local realtors and an Internet radio station that includes 6 hours of travel- talk shows, further providing advertisers with highly targeted high return on investment marketing solutions.
In addition to their assets in the traditional media space, the company has also recently acquired The Resorts & Residence Network, one of the first interactive TV networks, offering the consumer the ability to control where, when and how they access content on TV with supporting solutions for web and cellular devices. The Network combines targeted lifestyle programming with interactive advertising and transactional shopping components that enable viewers to request information, make reservations and get an in-depth look at products and services all through their remote control. The network is scheduled to launch to 25 million households this fall through Direct TV, AT&T, Verizon and select Comcast and Capital Broadcast markets. The goal is to reach 40 million households by the first quarter of 2010.
With a strong portfolio of media assets offering highly targeted marketing opportunities to advertisers, Next 1 Interactive appears poised to capitalize on the shift towards higher ROI marketing strategies that have begun to dominate the industry. The recent acquisition of the Resorts & Residence Network and the scheduled launch through Direct TV make now an excellent time to consider investing in the company as its profile is sure to be raised significantly among both consumers and marketers. As more and more advertisers continue to seek out the highest possible return on their investment, companies such as Next 1 Interactive could see increased profits as a result of their ability to deliver highly targeted, consumer specific marketing opportunities to companies seeking the most bang for their buck.