Market Overview

PreMarket Prep Stock Of The Day: Vaxart

PreMarket Prep Stock Of The Day: Vaxart

Amid the carnage in the technology sector over the last few sessions, the COVID-19 crisis has taken a backseat to a much-needed correction in the markets. However, there are still issues moving in response to the crisis.

One of those issues is Vaxart Inc (NASDAQ: VXRT) and is the PreMarket Prep Stock Of The Day.

The Company: Vaxart is a biopharmaceutical company focused on the discovery and development of direct-acting antivirals to treat infections that affect patients globally. The company has three product candidates: Influenza, Norovirus and RSV Vaccine, an oral fusion protein inhibitor for the treatment and prevention of respiratory syncytial virus (RSV) infections, and BTA074, a topical antiviral treatment in for condyloma caused by human papillomavirus.

Initial Surge: Before the open on June 24, as the issue was wallowing at the $2.50 area, it had a nice boost when it was revealed the issue was set to join the Russell 3000 index. In that session on much heavier than average volume, it rallied from $2.66 to $3.19. That was actually the secondary catalyst for the issue's jaunt to $17.49 by July 14.

On June 25, the company announced it signed a Memorandum of Understanding with Attwill Medical Solutions LP (AMS) affirming the parties' intent to establish AMS as a resource for lyophilization development and large scale manufacturing including tableting and enteric coating for Vaxart's oral COVID-19 vaccine. AMS will be assigning dedicated resources and equipment for the scale-up and commercial production of the vaccine upon entering a formal agreement.

During that session, it nearly doubled to $6.26 on monster volume. In volatile fashion, it worked its way higher before ending that session at a four-year closing high of $16.97 on July 14.

Reality Check: As is so common on “news” moves similar to this, they do not hold up. The stocks are rented for a few days by momentum traders and when it runs out of suckers for buyers, it reverses course hard.

Beside profit-taking, another catalyst for the retreat may be the revelation of a shareholder lawsuit by multiple law firms, on the behalf of customers who suffered losses due to securities fraud. A large portion of the technical damage was done in late July as the issue slumped to end the month at $9.39.

After attempting to stabilize at the $10 area in the first few weeks of August, it had another leg lower as the lawsuits continued to mount, reaching its low for the decline on Sept. 2 ($4.53). It ended last week not far off that low at $4.93.

We Won't Get Fooled Again: Before today's open, the company announced its COVID-19 vaccine candidate induced potent systematic and mucosal immune responses in preclinical studies. After a surge in pre-market trading to $6.70, the issue has grappled with the overhead supply phenomena (investors stuck long the issue, attempting to exit on any signs of strength).

In a fairly tight range following a higher open, it made its current high and low for the day in the first hours of the session. As of 11:30 a.m. ET, it found buyers just above Friday’s closing price of $4.93 at S5.11. On the upside, buyers have not been to take the issue anywhere near its pre-market high as $5.69 stands as the high for the day.


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