Companies featured in this edition of the newsletter: ACTC, CBMC, CETG, CNLG, GNBT, GSPG, ICLK
Uncertainty was the theme of the week as investors failed to make up their minds on the proper direction for the markets. The Dow lost 50 points to close at 8579 bringing its year to date loss to 35%. The Nasdaq rose 1.5%, closing at 1564, paring its YTD loss to 41%. The S&P 500 and Russell 2000 rose 0.9% and 3.8% for the week, reducing yearly losses to 39.5% and 36.5% respectively.
There were several major developments coming from the government last week, as the FOMC slashed the fed funds target rate from 1.00% to a range of 0.00% to 0.25%. In addition, the FOMC directive implied the Fed stands ready to do any, and all, things possible to stimulate the credit market and the economy, including possibly buying long-term Treasury securities. Not surprisingly, the 10-year Note fell to as low as 2.08% during the week. The White House also announced Friday that it would use $17.4 billion in TARP funds to aid ailing Detroit automakers, providing a much needed life line to the struggling industry.
Bad news was taken in stride yet again, demonstrated by the fact that Goldman Sachs (NYSE: GS) reported its first ever loss as a public company, which was wider than anticipated, yet still managed to post a strong gain for the week. Bleak employment data and continued signs of economic woes were largely discounted as markets searched for direction throughout most of the week. Another developing story from last week was the growing number of investors coming forward who had been burned by Bernard Madoff’s $50 billion Ponzi scheme, not the sort of news that investors were looking to hear given the market’s predisposition to bad news these days. Oil prices continued their plunge.
It will be a slow week for earnings reports leading up to Christmas, but expect announcements from Circuit City (NYSE: CC) and Walgreen’s (NYSE: WAG) before the open on Monday. Markets will close at 1 p.m. on Wednesday and remain closed on Christmas Day.
Economic reports for the week begin with Q3 Chain Deflator and Q3 GDP figures due out at 8:30 a.m. Tuesday, followed by November New and Existing Home Sales and Michigan Sentiment Index for December at 10:00 a.m. On Wednesday, expect reports for November Durable Orders, Weekly Initial Jobless Claims, November Personal Income and Personal Spending figures all to be released at 8:30 a.m. Weekly Crude Inventories will be announced at 10:35 a.m. on Wednesday.
The conference schedule will be light as well, but contract driller Grey Wolf (AMEX: GW) will hold a special shareholders meeting in Houston on Tuesday to vote on a proposed merger with Precision Drilling (TSX: PD). PNC Financial Services (NYSE: PNC) will also be holding a special shareholders meeting on Tuesday, in Pittsburg.
Conolog Corporation (NASDAQ: CNLG), an engineering and design company that provides digital signal processing solutions to global electric utilities, announced record sales of $490,000 for the month of November, posting an increase of 126% over the same period in 2007. The company will continue to expand its marketing and production efforts and plans to release its CM100 substation multiplexer by the third quarter, which will greatly expand product applications. Shares gained 16 cents to close at $0.50.
Drug Delivery company Generex Biotechnology (NASDAQ: GNBT), has entered into a partnership with Pevion Biotech to develop next-generation vaccines and immunotherapeutic products. Both companies have in-depth experience in developing immunotherapeutic vaccines for cancers, and will collaborate to look for possible synergies within their collective portfolios. Pevion specializes in enhancing vaccine potency of antigens, while Generex subsidiary Antigen Express is developing next-generation immunotherapeutic peptides using technology to increase antigen-specific stimulation of T helper cells. A combination of these two complementary technologies could produce significant advancements in the field of cancer research as the companies look to create more powerful antigens capable of stimulating the body to fight off cancer. Generex also announced last week that it has received a new European patent related to their flagship Oral-Lyn insulin spray titled “Micellar Pharmaceutical Compositions for Buccal and Pulmonary Application.” This new patent brings their total portfolio to 142 globally, with 21 in the US and 120 still pending in various jurisdictions. Shares lost 12 cents to end the week at $0.46.
interCLICK, Inc. (OTCBB: ICLK), the fastest growing advertising network in the US according to comScore, continues to announce positive growth in a challenging environment as the company raised its guidance for its fourth quarter ending December 31, 2008. ICLK now expects revenue for the fourth quarter to exceed $7 million, compared to its previous expectations for revenue to exceed $6.5 million. The company also expects that gross margin will exceed 35%, up from a prior forecast of 31%. In addition to these upward revisions, the company also expects to see its first quarter of positive Adjusted EBITDA since becoming public. The company attributes these increases in projections to the popularity of their behavioral targeting platform amongst advertisers looking to reach more highly targeted demographics during this challenging holiday retail season. Full year guidance was also raised, from $20 million to $21 million, in response to better than expected holiday performance. Shares lost a penny to close at $0.59.
Capital City Energy Group, Inc. (OTCBB: CETG), a diversified oil and natural gas company with three separate divisions, continues to expand towards its goal of becoming one of the nation’s leading independent vertically integrated producers of oil and gas, as the company announced that they have significantly increased their holdings in several of the major oil producing regions of the U.S. The company is following its strategy of developing a diversified portfolio of low-risk oil and natural gas properties, as they continue to seek investment opportunities that represent attractive ways to generate cash flow for shareholders and aggressively purchase interests in oil and natural gas wells while commodity prices remain low. These latest purchases reflect the company’s ability to identify and acquire assets which require small fixed costs in return for almost instant cash flow generation, and will surely position the company for further growth. The stock lost a quarter on the week, closing at $1.75.
GoldSpring, Inc. (OTCBB: GSPG), a North American precious metals mining company, focused in Nevada, with extensive, contiguous property in the Comstock Lode District, announced another round of strong assay results from their Hartford Complex project, suggesting mineralization beyond the areas previously thought to contain ore. The new drill holes expand the Company’s known resource in the northeast, northwest, east and south areas of the Hartford Complex, and indicate significant levels of silver. The results suggest that it might be in the company’s interest to expand their current focus to include some of the outlying areas of the previously designated pit, especially in light of the silver deposits reported in this round of exploration which could serve to significantly expand the revenue stream generated from operations. The stock remained unchanged at just over a penny on the week.
Advanced Cell Technology (OTC: ACTC), a developer of stem cell based treatments, continues to work towards broad scale commercialization of its innovative therapies, as it announced that it has licensed a non-essential piece of its intellectual property to Irish biotech company Transition Holdings, Inc. Under the terms of the agreement, Transition will give $2.5 million to ACTC in return for the rights to the technology, which is not related to any of their advanced clinical programs. The company plans to use the funds to retire $1.5 million in debt and apply the remaining $1 million towards its retinal pigment epithelium (RPE) cells program. In other news last week, the company announced that its technology platform is one of the leading candidates for federal funding proposed by the new administration under President-elect Barack Obama. The company is currently developing the only technology that can produce stem cell lines of all types without the destruction of the embryo, positioning them at the forefront of companies seeking grants to fund stem cell research from the incoming administration. Funding of these innovative technologies is expected to be a high priority of the new administration and will surely help ACTC become a leader in the fledgling field of regenerative medicine. The stock gained a penny to close at 3 cents on the week.
On the Wires:. interCLICK, Inc. (OTCBB: ICLK) announced that Calton Chan has been appointed vice president of sales, East region. In this role, Chan will lead the New York office’s sales team and help expand interCLICK’s roster of digital agency and vertical market-focused advertising customer relationships throughout the East Coast.
