|A Very Bullish Bounce|
|Friday, 21 January 2011 12:51|
That shares of Intellipharmaceutics (Nasdaq:IPCI) have continued to rise as bullishly as they have despite news that the company raised $12 million in gross proceeds through the sale of its common stock and warrants speaks to the strength of the company and the excitement that investors are feeling about their upcoming FDA approvals and catalysts.
Last night, prior to the financing news, we issued a trade alert about the company. We fully expect Intellipharmaceutics’ news flow to exceed the expectations outlined our report.
I just spoke to Shameze Rampertab, the company's Chief Financial Officer and VP of Finance. He says the company is much healthier due to the institutional round of investments they just received.
"It puts us in a healthy balance sheet posititon to complete our business plan," explains Rampertab. "If you look at 2010, you can see that we did quite a bit in terms of getting our FDA filings in meeting our milestones. You can expect to see similar milestones achieved in 2011."
The fact that the company has only been publicly traded for about 15 months and have been able to achieve as much as they have with the inital $8 million that was raised during their initial transaction tells investors that IPCI is very good about how they spend their dollars.
"Theres is a stringent process in terms of what projects we spend money on and why," says Rampertab. "There has to be a economic benefit to shareholders when we devide to pursue a certain development project."
Investors who acted on our trade alert were able to pick up discounted shares this morning. The stock has bounced back faster than just about anything I've ever seen following this type of raise and shares appear positioned to continue thier upward.
Remember, this is a "load and lock" play which has very few shares outstanding (a total of 15 million shares outstanding). Company's founders, Drs. Isa and Amina Odidi, are themselves the largest shareholders with virtually 6 million common shares in their holdings. That represents approximately 38% of the company's common shares. Institutional investors are obviously starting to come in and we expect any of several pending catalysts to ignite share prices given the very tight hold here.
We continue to be very bullish on IPCI and feel this one will have news and payoffs all year long.
On Monday, the news wires will be widely distributing our special report (pending title): "Biotech stocks to own in early 2011." It will feature in-depth profiles on IPCI and CBLI.
If you haven't done so already, please read our initial trade analysis on Intellipharmaceutics here:
Disclosure: Long IPCI
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