Readers Ask: Sponge Tech, Telanetix, Trubion Pharmaceuticals 22 comments
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In response to a number of requests that I've received via email or comments asking for 'VFC's Take' on numerous stocks that readers have found, I'll do my best to address as many as I can, as long as everyone takes a few things into account while reading:
- I have not thoroughly researched all of the stocks that I'm about to comment on. I've done the initial DD but my opinions are mostly based on my first impressions of the stock. I'm merely providing VFC's Take, as requested. Use that as a starting point to do your own DD.
- Don't get testy if I don't like your stock. Remember, this is just my initial impression and I take into consideration some variables that other people don't, that's why VFC's Take is not always the mainstream impression.
- I appreciate all the recent feedback, and keep the stock tips coming; this is a great forum for all investors of all levels to share tips and insights. There's a whole lot of stocks out there, but there's only a few gems. Let's keep trying to find those gems.
SpongeTech (SPNG.OB)
Here's my problem with the Spongetech move. They should have gone 1-10. By going 1-100 they take themselves out of the "speculators" domain. If I am in SPNG (which I am, avg .11), I am looking for a big hit. I don't want to buy SPNG at $14.00 a share! I'll take a potential ride up from $1.40, but no way am I buying at $14 when I don't know if as you say "the products are going to take hold". It would have to hit $100 a share to make the big hit I am in for. I sold half yesterday at .155 and may sell the rest. This is not a potential homerun anymore.
VFC's Take: I do see this poster's point, however the outcome does not have to be quite so bleak. The market cap is not going to change as a result of the reverse split, so if sales growth can support a higher market cap, then the stock price is going to rise the same amount (in terms of percentages) regardless of the price for which the stock trades.
By doing a 1-100 vice 1-10, the company is trying to weed out the speculative traders, in my opinion, and keep the long term growth investors. If the company can grow the business and sell the products then investors will be rewarded in the end.
As for the potential of a ten-bagger here, a ten-bagger from this point would mean a market cap of roughly one billion - regardless of whether the stock trades for ten cents or ten bucks. That is a bold prediction in any case, but if Spongetech can generate sales that support such a high market cap, then the stock will trade accordingly; again, I emphasize, it's a percentages game, not a stock price game.
If you thought Spongetech would sell that much product, then it's just as much worth the buy on September 23rd as it is today. I understand the newfound fear of the potential downside, but if you're in SPNG for the future of the potential sales growth - nothing has changed. Don't alter the amount of money you put in, just accept the fact that you'll have far few shares in the account - the percentages will play out regardless of price.
I'm going to add shares now - pre-split - and if the stock dips significantly post-split, I may add again; then I'll wait and see how well these products catch on and hold the market place.
As for the "home run" call, in my opinion, if you can double your money in a stock - I tend to consider that a home run, especially when most of America is satisfied with a 15% annual gain in a mutual fund.
I still think that SPNG could eventually be at least a double, even after the reverse split. For that potential double - I'll hold.
Disclosure: VFC is long SPNG.
Telanetix (TNXI)
Would like to know what you think about Telanetix (TNXI). It's in the visual conferencing field and was featured in Barron's a couple of years ago. It's way down since then, but it seems to be a solid business in a field that when it comes back again, should lift up the stock as well. Would you care to express and opinion on that? Thank you, one of your regular readers...ds
VFC's Take: I'll refer back to my earlier comments on TNXI (CLICK HERE) and since nothing has significantly changed since then, I won't alter my stance.
That being said, it's a lot more attractive buy right now for under ten cents than it was before; if it hits five cents, I might buy a few shares myself in order to sell them into any potential spike.
It's on the watch list, but I'm not yet a buyer.
Disclosure: No position.
Trubion Pharmaceuticals (TRBN)
VFC, you should check TRBN. Look at it's brakeout and news... It should move up a lot from recent level. Have a nice time.http://www.tradingmarkets.com/.site/news/top story/2503027/
Mark
VFC's Take: Ordinarily I'd shy away from a pharmaceutical stock after it has enjoyed a run such as the one Trubion had - in order to avoid chasing - but I think that this one is worth keeping on the watch list and, if you're looking for a long term speculative play, buy TRBN on the dips.
Trubion's pipeline is still in the early stages of development, although a recent partnership with Facet Biotech Corp. for the development of TRU-016, a treatment for Chronic lymphocytic leukemia [CLL], makes TRBN a bit more stable of a speculative investment than most, in my opinion; although partnerships mean nothing if the drug is proven to not work (see: Cell Genesys). Of note, Facet recently rejected a buyout offer by Biogen.
Trubion also has an alliance with Wyeth for the development of TRU-105 (it's most advanced candidate) and SBI-087.
Trubion's business plan of funding the pipeline products through partnerships somewhat alleviates the future risks of dilution and makes it a decent long term speculative play, in my opinion.
If you're looking to get in, I'd throw it on the watch list and wait for it to settle down again, a dip to below five bucks is a give, in my opinion; remember, this company is still a long way off from bringing anything to market. However, if you can't be bothered averaging down, buy a few shares now and throw them away for a while and check back in a year to see where they're at.
If nothing else, this one deserves to be kept on the watch list.
Disclosure: No positions.
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Another red flag is how they advertise. They constantly advertise where the security is traded. This is NOT a normal practice. Almost all the news is released solely by the company and often coincides when the stock is down.
I also find it interesting that they have yet to offer a proven winning product (it's all speculation right now), but they are already "exploring" many other uses for their sponge. Generally, successful businesses excel at one thing before branching out to others. Everything they say and do appear to be for the benefit of the stock price.
This stock smells funny. Don't get caught when the bottom falls out!
I did however do my due dillegence after all I saw were advertisements. At least what information is out there. There is no real information other than filings that were prepared by an accounting company that lost it certification (now they actually have a real accounting firm). Go ahead and look up their transfer agent. It's in the garage of a house in NJ.
Have fun when the bottom drops out just like what happened to anyone that bought at .28 and found the same day closing price around .13 or those who bought in the high teens only to find the following day the stock dropped to 12 cents the next business day. That is not normal activity. I could care less what people invest in but if this helped one person, than I'm glad I posted.
You seem to be a misinformed investor that believes everything a company says in it's own press releases. I hope I'm wrong because I don't take joy in other people losing money but this might be a good learning leason for you. There are better things to buy than something that has so many red flags. Enjoy!
On Sep 10 12:09 PM BittyMack wrote:
> The guy above me is short. Read the Yahoo Finance articles yourself
> and do your due diligence. This company is making money hand over
> fist, no debt and their reorders are strong. They are in 40,000 retail
> locations (adding Walmart and Target soon) and will be in 100,000
> locations by the end of this year. They made more this past 3 months
> than they did last year. 70 Million to be exact. Do not trust posts
> from people here. They are either short or long. ONLY read the news
> reports or PR by the company, look at the filings. This one is a
> big fat triple from .12. Bought more today. With the 10K coming out
> latest by Tuesday morning, we will see a nice shoot up then. I could
> go on forever about why to buy, but better to read the yahoo, finance,
> news. That will tell you exactly what you need to know. Anyone who
> takes the time to bash a stock is either short OR wanting to get
> in lower. So, you can't trust them. Good luck and let me know when
> you double your money. Oh, here is an article about recent reverse
> splits - they have worked out great - it creates a short squeeze:
>
> www.marketwatch.com/st...
>
> VERY LONG SPNG
Amy Petty
Waggener Edstrom Worldwide for Trubion Pharmaceuticals
My question is what should I expect come sept 22 to stock prices. I think I understand that if prices is at .15 it would then be $15.Right? But will this slow growth of stock price greatly or what? Without the split I really need to see around .20 to feel I can sell and make any real money.
Honest advice please.I may be a new investor but I know people and business real well. :)
could u explain what a "short squeeze" is please?
Be certain that when the shortages on 22 before the split, it could even reach 0.7-0.85!!
Good luck!
On Sep 11 01:42 PM BittyMack wrote:
> Yes, you need to expect a major short squeeze when the new cusip
> number is given. All shorts have to settle their trades by then.
> This will bring the stock price way up. You will get your .30 yet
> and more.
> Strong buy!
I am a little worried about the Getfugu investment, and the behind-the-scenes opacity, but I feel that mgmt. is fully invested and looking to the future strategically.
I will continue to buy on dips and think that this stock is a good gamble.
On Sep 14 07:22 AM BittyMack wrote:
> When the cusip number is given, the shorts have to cover. All shares
> are required to be settled with the new cusip number, so it will
> induce a short squeeze. Shorts will be scrambling to buy back and
> will shoot the price up.
On Sep 15 04:38 PM sdfsdf wrote:
> I have traded SPNG for several years. They are a always pumping this
> stock it is a classic pump and dump. Their sponges sound good only
> in ad's. The company has an habit of diluting share holders and will
> do it again. Be careful not an investment just a trade.
could be foolish and stupi enough to use an accounting firm that did not have a good reputation.
In retrospect, if the SEC would not have forced them to redo the 2008, and if 2009 was ready, the reverse would have been done with and the stock would have already settled into a zone.
Right now it is an absolute mess
and if the stock as a corporate entity would have its trading status suspended
by the SEC and the OTCBB because of what the company was doing in response to what the naked shorts were doing
because of a lack of action by the
SEC who were informed about the naked short nightmare (incidentally the naked short fraud was responsable for last year's global financial collapse)
then every naked short would be scott free , and could continue to fleece the world because the world is allowing the fleece to happen.
Yes or no? Can you blame any company for playing dirty against the naked short consortium who they themselves are playing dirty as we speak?
Should the interests of naked short fraud artists who are
wearing $2000 suits and working for Hedge Funds be protected so they can continue to rob the world of its wealth?
How could this happen?
Because in this country and in this world ; we are capable of sending people to the moon, but we are too dam lazy to come up with an effective way to track down every last naked short ,no matter who he is, no matter who his friends are
and put the crooks in jail to be treated and tried with as much respect as any terrorist.
The SEC does not have enough manpower, money and teeth.
If that is the truth, then I say that America does not have its priorities straight.
Neither does the rest of the world.
The naked short war puts every dollar earned, saved and invested at risk
and everyday the naked shorts, the bad guys, are giving "us" a bloodbath
worst than anything we have ever seen on any battlefield..
It may be convenient not to do anything.
It may cost a fortune to clean up the mess and to build new prisons
and
to put the crooks away for life, but the cost "not to do anything"
will be astronomically beyond any amounts the entire world
could ever borrow-to-fix
if the world just allows
"naked short terrorism to continue"
That's where the 3rd world war is being waged.
That's where effort money and more money
should be put.
We don't need a band-aide that costs 1000 trillion dollars.
What we need is to stop "naked short terrorism in its tracks
and we need to do it now"
Make no mistake about it.
SPNGE may be collaborating with the SEC
but if the SEC expects to use this company
as a fall-guy to cover up their ineffectiveness
towards nakeD short terrorism
they will discover very quickly
that the marketing geniuses
who put the American Cleaning COMPANY in every baseball stadium
CAN/WILL also use their media savy
to cause justified public embarrassment
to an administration
that continues to drag its a$$ on this issue
but is looking to avoid the weight of its
public responsability by putting the blame
on a company trying to survive
www.squidoo.com/sponge...
spongetech daytraders opinion poll.
Purpose of the poll is to accumulate data, in the form of
the clicked votes, real sentiment per question answered.
You can return to the sight anytime to review on going poll results
and you can also post questions that may be added to the poll's list of questions for the readership to answer with a click of the mouse.
Thank you to all those who have participated.
www.squidoo.com/sponge...
On Oct 01 11:18 AM fanofgoodstocks wrote:
> www.squidoo.com/IF-I-W...