Intrexon: A Stock Poised for Growth

Intrexon inc. (NYSE:XON) has been one of my favorite stocks for 2015. The company is a leader in an exciting emerging area of biotech known as synthetic biology. It offers a diverse portfolio of synthetic biotechnologies that have a wide range of  applications in industries including health, environmental, food and energy. The game changing potential for these technologies have given investors a very bullish long-term outlook on the stock with investing titans like Bill Miller of Legg Mason dubbing Intrexon as “the AAPL of the next decade”. Further optimism for the company hinges on its stellar management team led by billionaire biotech investor Randal J. Kirk.

Synthetic biology is essentially the manipulation of DNA which allows you to design and control cells for a specific function. Intrexon calls this technology a “paradigm shift” in the analysis of biology which will allow for numerous innovations across many different industries, from creating targeted cancer therapies to apples that do not brown.

Intrexon is different from most biotech companies that typically have one or two speculative drugs or therapies in the works. Companies like this depend on the FDA’s approval, thus presenting a significant risk if their product is not approved. Rather than developing a couple of drugs and treatments Intrexon designs, builds, and regulates gene programs, which are DNA sequences consisting of key genetic components. The company applies these technologies and monetizes them through strategic partnerships that they call “exclusive channel collaborations”. Many publicly traded biotech companies have entered into these collaborations with Intrexon. Here are just a few:

  • Sanofi (NYSE:SNY)
  • Johnson & Johnson (NYSE:JNJ)
  • Fibrocell Science, Inc. (NASDAQ:FCSC)
  • Synthetic Biologics Inc. (NYSEMKT:SYN
  • ZIOPHARM Oncology Inc. (NASDAQ:ZIOP)

All of these companies use Intrexon technologies for the research and development of their own drugs and therapies. Due to its diverse portfolio of technologies and partnerships Intrexon is inherently less risky than many other companies in the biotech sector. Any significant successes or breakthroughs coming from the company’s partners could boost its own stock significantly.

Intrexon is currently trading around $51 which is about 26% off its recent all time high made just last week at $69. It sold off sharply after missing its Q2 earnings estimates. This recent correction is, in my opinion, a great long term buying opportunity. Earnings are important, however, earnings were hurt by capital expenditures which are necessary to fuel future growth. The company still exhibits undeniable growth with revenues increasing 300% year-over-year. As you can see in the chart below, earnings have fallen despite healthy revenue growth. Most likely this can be attributed to expensive investments in research and development which should pay off in the future.


Technical Analysis

The chart below shows the stock’s performance this year with the 50 day moving average overlaid, one of the most widely watched indicators. As you can see,the stock sold off sharply after becoming very overextended from the 50-DMA. Recently it has dipped under the moving average, and  historically when this occurs it has been a great time to buy. The stock has some real potential and is worth keeping an eye on.

Screen Shot 2015-08-13 at 12.46.25 PM

Tesla’s Second Quarter Earnings Preview

Tesla Motors inc. ($TSLA) is scheduled to report their second quarter earnings results after the bell on Wednesday August 5, 2015.

Here’s a link to the article I wrote for StockTwits blog.

EPS: Estimates range from $0.57 to $1.39

Revenue: revenue is expected to come in around $1.16 billion

Here’s some key points to be watching for:

  • Additional capital expenditures
  • Delivery numbers, the company expects 55,000 deliveries in FY’15
  • Sales growth in China and the impact of a strong dollar
  • Comments regarding new developments (Model 3, Gigafactory, Powerwall)

5 Things we Learned from Kyle Bass

By Patrick Dunuwila via StockTwits Blog

Legendary hedge fund manager Kyle Bass gained notoriety for accurately predicting and profiting from the 2008 financial crisis. Bass was early to notice a bubble forming in subprime mortgages and in 2007 began purchasing credit default swaps on subprime residential mortgage backed securities. When the housing market finally collapsed Bass made hundreds of millions of dollars from his position. Our partners at Real Vision TV recently sat down with Bass for an interview. Here are some powerful insights from his talk.

1.) “There’s no true science to it, it’s an Art”

This was Bass’ response when being asked about his procedure on finding trade ideas. What he meant by this was that as an experienced investor he’s able to successfully rely on his intuition when scoping out opportunities. Through years of practice and dedication he’
found his own style and method. There isn’t an exact formula behind it, either. Instead, he’s an artist carefully and creatively scanning the world for investment ideas.

2.)  He has an incredibly high level of conviction with his trades

Once Bass has established a thesis on a particular trade, he has complete confidence in it. It no longer matters what other people think. For example, before the housing market collapsed there were plenty of market professionals that told him he was crazy. Continue reading

Best Online Trading Websites and Resources

Here’s a list of my favorite online trading websites & resources. These sites are essential to beginning traders. Each site is unique and when used together will help you to stay informed as a trader. — Great platform for sharing ideas, charts and trade with other retail investors. StockTwits can be a powerful tool for gauging sentiment on particular stocks as well as see which stocks are trending, all in real time. — Awesome site for creating and sharing visually appealing charts. Truly a perfect site for technical analysts. TradingView allows you to share charts directly to Twitter or StockTwits. — The best source on the web for research and information on exchange traded funds. — Very popular for charts and heat maps of the markets. I find it the most useful to check either pre-market or post-market. It’s packed with useful data and information including insider activity and major news. — Crowdsourced earnings estimate site that provides insight to the real whisper number to beat. Super useful site during earnings season. — Great site for staying up-to-date with the stocks on your watch list. Freelance writers post articles analyzing particular stocks as well as global macro trends.

My Most Trusted Market News Sources 

Both Market Watch and Bloomberg are my favorite financial news outlets. They both report the major financial news but each have different editorial articles. Download the apps on your iPhone and turn on push notifications to stay up-to-date.