When the market took its big tumble nearly two years ago, most stocks have found their way back to at least regain a good portion of their losses. Others have continued the struggle despite some periods of recovery. June saw a host of notable companies receiving delisting warning notifications from the Nasdaq. Eight of those companies are listed below with some commentary on their present position. It is important to note that companies have 180 days to comply and that companies are entitled the right to appeal delisting. Other companies that list on the higher tiers of the Nasdaq exchange (i.e. GS and GM) have the ability to consider moving their shares to one of the lower tiers of the Nasdaq.
Anchor BanCorp Wisconsin (Nasdaq GM: ABCW)
Industry: Savings & Loans
Received Notification: June 16, 2010
Compliance Required by December 15, 2010
Anchor received notification because the bid price of the Company’s common stock closed below the required minimum $1.00 per share for the previous 30 consecutive business days (May 6, 2010 through June 17, 2010.) (Rule 5450(a)(1) ) Presently, the management has not come forth with any definitive plan to resolve the warning although they have been selling branches and reported decreasing net losses in June. Anchor is also “pushing the envelope” with regards to TARP funding as it has missed five consecutive TARP dividend payments to date. The Treasury retains the right to elect directors to the Anchor board if another payment is missed. More information on ABCW can be found on the Company website at www.anchorbank.com.
OXiGENE, Inc. (Nasdaq GM: OXGN)
Industry: Biotechnology
Received Notification: June 17, 2010
Compliance Required by December 14, 2010
OXiGENE is presently at a 52-week low, closing yesterday at $.39. The biopharmaceutical company is showing promise with some of the drugs that it has in development, but has a long way to go to regain compliance at this point. The Company recently announced that data from its clinical trials of ZYBRESTAT and chemotherapy in patients with anaplastic thyroid cancer (ATC) will be presented at the upcoming 14th International Thyroid Congress in Paris, France on September 12, 2010. The results will be publicly announced immediately afterward. More information on OXGN can be found on the Company website at www.oxigene.com.
Insmed, Inc. (Nasdaq CM: INSM)
Industry: Biotechnology
Received Notification: June 18, 2010
Compliance Required by December 15, 2010
Insmed, Inc. is also in violation of Nasdaq Rule 5450(a)(1) with their stock trading at $.68 presently. INSM was trading just over a dollar in early May, but has been on a slide since it tumbled on earnings. The slide may be a bit unwarranted since Insmed still has $120 million on their balance sheet, a feat not often seen in a developmental biotechs. The Company has commented that they are “considering appropriate business measures to address compliance with the continued listing standards.” More information on INSM can be found on the Company website at www.insmed.com.
Dynatronics Corporation (Nasdaq CM: DYNT)
Industry: Medical Appliances & Equipment
Received Notification: June 16, 2010
Compliance Required by December 13, 2010
Dynatronics Corporation designs, manufactures, markets, and distributes physical medicine and aesthetic products primarily in the United States and Canada. Despite Dynatronics posting six straight quarters of positive growth in sales and profits and a 445% increase in pre-tax profits for the nine-months ended March 31, 2010, the stock price has dropped recently to around $.70. Kelvyn H. Cullimore Jr., chairman and president of Dynatronics, stated in a recent press release, “…we have been negatively affected by the recent volatility in the stock market that has pushed our stock price below the $1.00 minimum bid price requirement.” Mr. Cullimore projected confidence that the Company will regain compliance. With less than 9 million shares in the public float, DYNT can move very easily with any buying pressure. More information on DYNT can be found on the Company website at www.dynatronics.com.
Nile Therapeutics, Inc. (Nasdaq CM: NLTX)
Industry: Biotechnology
Received Notification: June 18, 2010
Compliance Required by December 15, 2010
Nile is another company in violation of the $1.00 minimum requirement. The biotechnology company recently diluted to raise $4 million in capital for their ongoing Phase II trial of CD-NP in acute heart failure patients, and for general corporate purposes and working capital. The public offering increased the total outstanding shares by approximately 20%. NLTX was in a downtrend since trading over $2.00 a share last September, but really tumbled since the news of the public offering in early April and hasn’t been able to recover since. NLTX is currently trading around $.32 and remains a bit of a speculation play based on the future success of CD-NP. Nile management is currently evaluating all options to maintain compliance with listing regulations. More information on NLTX can be found on the Company website at www.nilethera.com.
TeamStaff, Inc. (Nasdaq CM: TSTF)
Industry: Staffing & Outsourcing Services
Received Notification: June 1, 2010
Compliance Required by November 29, 2010
TeamStaff, a leading logistics and healthcare services provider to the Federal Government and Department of Defense, received its warning notification at the beginning of June. TSTF was listed on the Nasdaq Global Markets until November of 2009 when it was moved to the Capital Markets for non-compliance with the $5.00 per share requirement. TeamStaff announced on June 17th the commencement of its five-year contract with the Armed Forces Retirement Home, which it previously valued up to $3.3M, to provide healthcare services support, but the price per share did not get a significant increase. Much like DYNT, TSTF has an extremely low float (approximately 3 million shares in the float), so it can move quickly with buying pressure. TeamStaff management is considering all options to maintain compliance. More information on TSTF can be found on the Company website at www.teamstaff.com.
USA Technologies, Inc. (Nasdaq GM: USAT)
Industry: Business Services
Received Notification: June 14, 2010
Compliance Required by December 15, 2010
A supplier of networked devices and wireless non-cash transactions, associated financial/network services and energy management, USA Technologies’ story behind receiving the delisting warning resembles that of Nile Therapeutics. Shares of USAT were in a pretty solid channel, trading between $1.40 and $1.80 for nearly eight months until a bit of a price per share drop in March was followed by a public announcement of a public offering to raise $3 million. The price per share was still near $1 at the time of offering, but has since dropped to less than $.50. On June 10th, the Company announced that it has approved an extension of its ongoing subscription rights offering, which was scheduled to end on June 9th, through July 22nd. More information on USAT can be found on the Company website at www.usatech.com.
TerreStar Corporation (Nasdaq GM: TSTR)
Industry: Diversified Communication Services
Received Notification: June 3, 2010
Compliance Required by November 30, 2010
On May 25, 2010, an article on online.Barrons.com mentioned TerreStar as having a strong potential upside (the sentence also stated that it carried “considerable risk”). It appears that investors seem to be leaning towards staying away due to the risk aforementioned. Shares of TSTR had been oscillating around the $1.00 area (give or take $.20) since November of 2009 until the end of April this year when the share price dropped to the $.40 area. TerreStar still may present a solid investment opportunity, but potential investors appear to be gun shy until the TerreStar management issues an announcement regarding how they will address compliance. More information on TSTR can be found on the Company website at www.terrestar.com.
All due diligence is placed upon the individual investor, but sometimes a stock may be depressed and not necessarily completely reflective of the company’s true potential.
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