HAS OPKO HEALTH INC. (NASDAQ:OPK) HIT ROCK BOTTOM?
Sep 19, 2018 | Business
The situation in front of us now in Opko Health Inc. (NASDAQ:OPK) represents an interesting psychological puzzle for shareholders. As you probably know, the company’s CEO, Miami biotech billionaire and philanthropist Dr. Phillip Frost, and the company, itself, were charged by the SEC for what amounts to stock price manipulation a couple weeks ago. The stock was halted for a week, and then reopened last Friday and has traded this week.
The essence of the situation is what we have characterized as a short-squeeze opportunity for short term long side gains. The scandal mixes with bad balance sheet problems and declining revenues. But the stock has found support and we can imagine that this must be a wildly popular short. And Dr. Frost, whatever he is, is a wily veteran operator with probably a team of very savvy lawyers and advisors and a lot of local public good will. If you’re short, you need to be braced for a counterpunch. If you’re uninvolved, you might be able to profit from it simply because the narrative here is so one-sided.
Opko Health Inc. (NASDAQ:OPK) bills itself as a healthcare company, engages in the diagnostics and pharmaceuticals business in the United States, Ireland, Chile, Spain, Israel, Mexico, and internationally.
The company’s Diagnostics segment operates Bio-Reference Laboratories, a clinical laboratory that offers laboratory testing services in the detection, diagnosis, evaluation, monitoring, and treatment of diseases. The Bio-Reference Laboratories also provides core genetic testing and leverage products, such as the 4Kscore prostate cancer test and the Claros 1 in-office immunoassay platform.
The company’s pharmaceutical segment offers Rayaldee, a treatment for secondary hyperparathyroidism in adults with stage 3-4 chronic kidney disease patients with vitamin D deficiency; and VARUBI for chemotherapy-induced nausea and vomiting.
This segment is also developing OPK88004, an androgen receptor modulator for benign prostate hypertrophy and other urologic and metabolic conditions; OPK88003, a once or twice weekly oxyntomodulin for type 2 diabetes and obesity; hGH-CTP, a growth hormone injection that is in Phase III clinical trials; and Factor VIIa drug for hemophilia.
In addition, it develops and produces specialty active pharmaceutical ingredients; and discovers drugs for the treatment of cancer, heart disease, metabolic disorders, and a range of genetic anomalies.
Further, this segment engages in the development, manufacture, marketing, and sale of pharmaceutical, nutraceutical, and veterinary products; and markets and distributes pharmaceutical and natural products. Additionally, OPKO Health, Inc. operates pharmaceutical platforms in Ireland, Chile, Spain, and Mexico.
Is OPK OK?
As noted above, OPK is running through the gutter right now, surrounded by scandal and mired in more mundane but not unimportant problems. That said, the stock has been shellacked over the past 18 months, and this scandal-driven pullback comes in the technical place of a possible pullback following a primary base of support.
This is probably a lower-low in terms of sentiment about the stock even though the price per share is at a higher point than it was earlier this year. That is often the character of strong buying moments. The blood is running through the streets on this stock right now. If there is longer-term value incorporated into its pipeline or asset base, then now is the time to be buying it.
At this time, carrying a capital value in the market of $2.49B, OPK has a significant war chest ($80.4M) of cash on the books, which compares with about $306.9M in total current liabilities. OPK is pulling in trailing 12-month revenues of $975.8M. However, the company is seeing declines on the top-line on a quarterly y/y basis, with revenues falling at -16.1%.
This may be a very interesting story and we will look forward to updating it again soon.
Sep 19, 2018 | Business
The situation in front of us now in Opko Health Inc. (NASDAQ:OPK) represents an interesting psychological puzzle for shareholders. As you probably know, the company’s CEO, Miami biotech billionaire and philanthropist Dr. Phillip Frost, and the company, itself, were charged by the SEC for what amounts to stock price manipulation a couple weeks ago. The stock was halted for a week, and then reopened last Friday and has traded this week.
The essence of the situation is what we have characterized as a short-squeeze opportunity for short term long side gains. The scandal mixes with bad balance sheet problems and declining revenues. But the stock has found support and we can imagine that this must be a wildly popular short. And Dr. Frost, whatever he is, is a wily veteran operator with probably a team of very savvy lawyers and advisors and a lot of local public good will. If you’re short, you need to be braced for a counterpunch. If you’re uninvolved, you might be able to profit from it simply because the narrative here is so one-sided.
Opko Health Inc. (NASDAQ:OPK) bills itself as a healthcare company, engages in the diagnostics and pharmaceuticals business in the United States, Ireland, Chile, Spain, Israel, Mexico, and internationally.
The company’s Diagnostics segment operates Bio-Reference Laboratories, a clinical laboratory that offers laboratory testing services in the detection, diagnosis, evaluation, monitoring, and treatment of diseases. The Bio-Reference Laboratories also provides core genetic testing and leverage products, such as the 4Kscore prostate cancer test and the Claros 1 in-office immunoassay platform.
The company’s pharmaceutical segment offers Rayaldee, a treatment for secondary hyperparathyroidism in adults with stage 3-4 chronic kidney disease patients with vitamin D deficiency; and VARUBI for chemotherapy-induced nausea and vomiting.
This segment is also developing OPK88004, an androgen receptor modulator for benign prostate hypertrophy and other urologic and metabolic conditions; OPK88003, a once or twice weekly oxyntomodulin for type 2 diabetes and obesity; hGH-CTP, a growth hormone injection that is in Phase III clinical trials; and Factor VIIa drug for hemophilia.
In addition, it develops and produces specialty active pharmaceutical ingredients; and discovers drugs for the treatment of cancer, heart disease, metabolic disorders, and a range of genetic anomalies.
Further, this segment engages in the development, manufacture, marketing, and sale of pharmaceutical, nutraceutical, and veterinary products; and markets and distributes pharmaceutical and natural products. Additionally, OPKO Health, Inc. operates pharmaceutical platforms in Ireland, Chile, Spain, and Mexico.
Is OPK OK?
As noted above, OPK is running through the gutter right now, surrounded by scandal and mired in more mundane but not unimportant problems. That said, the stock has been shellacked over the past 18 months, and this scandal-driven pullback comes in the technical place of a possible pullback following a primary base of support.
This is probably a lower-low in terms of sentiment about the stock even though the price per share is at a higher point than it was earlier this year. That is often the character of strong buying moments. The blood is running through the streets on this stock right now. If there is longer-term value incorporated into its pipeline or asset base, then now is the time to be buying it.
At this time, carrying a capital value in the market of $2.49B, OPK has a significant war chest ($80.4M) of cash on the books, which compares with about $306.9M in total current liabilities. OPK is pulling in trailing 12-month revenues of $975.8M. However, the company is seeing declines on the top-line on a quarterly y/y basis, with revenues falling at -16.1%.
This may be a very interesting story and we will look forward to updating it again soon.