Immunomedics: Updates To Thesis, Buy The Secondary

Summary

• Shares have risen by just 8% since my initial article.
• I provide a recap of the bullish thesis and recent events.
• This ADC specialist is the front runner in the lucrative TROP2 space, looking to establish a beachhead in triple-negative breast cancer before expanding into other indications.
• ASCENT confirmatory trial will read out mid-2020 with its PFS primary endpoint, another key catalyst to look forward to.
• Immunomedics is a Buy, for which I suggest accumulating dips with patience.
• Looking for a helping hand in the market? Members of ROTY get exclusive ideas and guidance to navigate any climate. Get started today »

Shares of Immunomedics (IMMU) have risen by just 8% since my initial article was published in April of last year, as we delved into the prospects and future potential of the company's ADC platform and specifically lead candidate sacituzumab govitecan.

With the recent resubmission of its U.S. marketing application for sacituzumab govitecan (seeking approval to treat patients with metastatic triple-negative breast cancer who have received at least two prior lines of therapy), coupled with a dip caused by a $250 million secondary offering, I believe it's the right time to revisit this intriguing oncology story.

Chart

Figure 1: IMMU daily advanced chart (Source: Finviz)

When looking at charts, clarity often comes from taking a look at distinct time frames in order to determine important technical levels to get a feel for what's going on. In the above chart (daily advanced), we can see the stock bottom around the $12 level both in June and again in October. Shares rebounded back to highs in the latter part of 2019 as management continued to execute in the clinic via launching of studies for expanded indications for sacituzumab govitecan. The recent dip appears related to announcement of the secondary offering, which I believe is offering readers a solid buying opportunity (if they have a medium- to long-term time frame).

Overview

In my last article, I outlined the following keys to the bullish thesis:

• First, I introduced readers to the story by noting that the company's ADC platform has the potential to address 90% of all human cancers and reminding them that data for lead candidate sacituzumab govitecan had drawn considerable interest. Its target, TROP2, is broadly expressed across a variety of cancers and immunohistochemistry has demonstrated that 80% of solid cancer patients have moderate to strong expression. The lead indication of mTNBC is an area of oncology desperately in need

Analyst’s Disclosure:I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Disclaimer: Commentary presented is NOT individualized investment advice. Opinions offered here are NOT personalized recommendations. Readers are expected to do their own due diligence or consult an investment professional if needed prior to making trades. Strategies discussed should not be mistaken for recommendations, and past performance may not be indicative of future results. Although I do my best to present factual research, I do not in any way guarantee the accuracy of the information I post. I reserve the right to make investment decisions on behalf of myself and affiliates regarding any security without notification except where it is required by law. Keep in mind that any opinion or position disclosed on this platform is subject to change at any moment as the thesis evolves. Investing in common stock can result in partial or total loss of capital. In other words, readers are expected to form their own trading plan, do their own research and take responsibility for their own actions. If they are not able or willing to do so, better to buy index funds or find a thoroughly vetted fee-only financial advisor to handle your account.