Access Update- #69

It’s time to make our first sale and take some profits.  SIGA Technologies (Nasdaq: SIGA) is up sharply in the last week, despite a lack of news.

The markets are tough these days and in the interest of discipline, we think it’s a good idea to sell half of your stake in SIGA.  Keep the other half of your position on, as we still want to be in it when the company announces a nine-figure deal with the Federal government later this year.

And if the stock heads lower, we may look to add again.

But with the opportunity to take a 66% gain (based on an entry price of $2.52 when we recommended it on October 16th), we want to put some profits in our pocket and be ready to put those funds to use in our next pick.

What to do now:  Sell half of your position in SIGA Technologies at the market.

Once your trade is confirmed, let us know how you did.  Email us at research@accessresearchgroup.com

Welcome New Subscribers

We’d like to welcome all of our new subscribers to Access.  We’re confident that Access is unlike any investing service you’ve ever experienced, as we provide you with institutional quality research that previously was only available to hedge fund portfolio managers.

Roughly every six weeks you’ll receive a new recommendation in the small cap healthcare sector, which has potential for explosive gains.  We’re not looking for 10% winners.  We’re searching for stocks that are the next Celgene (Nasdaq: CELG), Amgen (Nasdaq: AMGN) and Intuitve Surgical (Nasdaq: ISRG).

We believe each stock in the Access portfolio has that potential, so it’s important not to cherry pick, meaning only buy one or two of the stocks.  The portfolio is designed so that the winners will more than make up for any losers, so it’s important to have exposure to all of the names on an equal dollar basis.  But only buy the stocks at or below our recommended price.  Controlling risk is as important as searching for reward.

We received a question from new subscriber I.R.H., who asked:

I purchased MELA stock.  Will you be updating me on the status and when to sell?

Absolutely.  Along with the institutional quality reports, you’ll be receiving these updates at least once per week (and whenever there is important news on any of our positions).  And as you can see from the beginning of this update, we’ll provide specific instructions on when to take profits.

If anyone has any questions about our portfolio or the service, please don’t hesitate to send us an email at research@accessresearchgroup.com

Now on to some news.

Cytori Files Shelf

Cytori Therapeutics (Nasdaq: CYTX) filed a shelf offering to sell $75 million worth of stock or debt securities.  We’ve mentioned that this is the one stock in our portfolio that needs to raise cash.

The stock has been on a nice run lately due to the momentum in the stem cell sector.  I wouldn’t be surprised to see the company try to raise the money sooner rather than later, while there is still buzz about stem cells.  That will likely be dilutive to shareholders.

However, the stock is higher today, despite the news and we are in this name for the long haul, as we believe the Celution System will continue to gain traction in Europe and Asia.

And keep in mind that Cytori actually has product on the market to sell, while most stem cell companies are still conducting clinical trials.

Synta in the Black

Our position in Synta Pharmaceuticals (Nasdaq: SNTA) is now positive (based on an entry price of $7.96 on August 25th).  The stock has come roaring back lately, perhaps on news that CEO Dr. Safi Bahcall will be making a presentation at the BIO CEO Conference on February 9th.

Some investors or traders may be hopeful that SNTA will discuss their phase III data for elesclomol at the conference.  I don’t expect the data to be available by then.  When I met with Dr. Bahcall a few weeks ago, he said the data would be out by May.

If he does not discuss the phase III data, I would not be surprised to see the stock sell off a bit after the conference.

However, we’re not trading this name.  This is the stock that we believe is the next Celgene.  If elesclomol is proven safe and effective against melanoma, this is the stock you’ll be telling your friends about at cocktail parties two years from now.  However, be prepared; they won’t believe that you got into at such a low price.

New Recommendation Update

I anticipate my next recommendation to be out in several weeks.  While the J.P. Morgan Healthcare Conference provided me with ideas and boatloads of new contacts, it did set back my research a bit.

The good news is that the research is going well, and I’m very excited about the next pick.  I still need to confirm a few things and speak to a few people, but the technology that I’m looking at is fascinating and could be a game changer in how existing medicines are given, especially in the cancer space.

Even better is that Wall Street doesn’t yet realize that this company is not the same dog it was several years ago.  It has a completely new management team and a deep pipeline.  Once the institutions realize what this company has, it should be a huge winner.

That’s it for now.  Enjoy the SIGA profits.

Marc Lichtenfeld
Director of Research
Access Research Group

Current Portfolio:

Name: Rochester Medical
Symbol: ROCM
Current Price: $11.71
Comments: Buy up to $15.00

Name: SIGA Technologies
Symbol: SIGA
Current Price:  $4.18
Comments: Take Profits on
Half of Your Position .

Name: Synta Pharmaceuticals
Symbol: SNTA
Current Price: $8.57
Comments: Buy up to $7.00

Name: ViroPharma
Symbol: VPHM
Current Price: $11.98
Comments: Buy up to $12.50

Name: Cytori Therapeutics
Symbol: CYTX
Current Price: $5.00
Comments: Buy up to $5.00

Name: Electro-Optical Sciences
Symbol: MELA
Current Price: $5.22
Comments: Buy up to $5.00