August 19, 2013
Nuvilex Outshines Its Peers
Lost in the dog days of August is the remarkable performance of Nuvilex, Inc. (OTCQB – NVLX - $0.145 – Spec Buy) relative to the market and some of its key peers. Over the past ten days, while biotech stocks have largely come under pressure, Nuvilex has not only held its own but remains well above its key daily moving averages (DMA).
For example, the NASDAQ Biotechnology Index has declined by nearly 7% during this period but two of Nuvilex’s larger peers, Merrimack Pharmaceuticals and Threshold Pharmaceuticals have really taken it on the chin. Merrimack, a cancer-fighting encapsulation-based biopharmaceutical developer is down roughly 30% on very heavy volume despite favorable development news. Judging by its short- and intermediate-term trading patterns, Merrimack is clearly out of favor as it is now 32% and 46% below its 50-day and 200-day moving averages respectively. Threshold has fared almost as poorly as it has declined by around 10% during the same period. Again, this drop was not buttressed in the slightest by news of the launch of a new Phase II trial. While it is incrementally above its 200-day moving average, it is 19% below its 50-day MA.
Despite all of these bearish signals, Nuvilex has risen incrementally, which is a testament to the building bullish fundamental case for the Company. In addition to its average daily volume for the past 20 days of 3 million shares which is an increase of almost 50% as compared to the full year average, the stock is 32% higher than its 50-day and more than 300% greater than its 200-day MA.
The combination of a strong technical case for the stock, along with major improvements to the Company’s fundamental outlook, position the stock to test the highs reached during the second quarter of 2013. This move would coincide with the closing of the Company’s efforts to acquire the rights to the use of the cellulose-based live-cell encapsulation technology in the development of treatments for diabetes, in early 4Q13.
However, the move could occur even sooner, based on the current herd mentality which is chasing performance at all costs. For those investors and traders seeking alpha in the oncology treatment segment of the biotech world, Nuvilex may be the best option and surely offers the greatest upside in the long term and a series of milestones to drive the stock higher in the near term.
For more information, refer to our previous NVLX Reports, Updates and Hot Topics by visiting www.GoldmanResearch.com
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Senior Analyst: Robert Goldman
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