Insys Therapeutics Inc. (NASDAQ:INSY) Sued

Insys Therapeutics Inc. (NASDAQ:INSY) Sued

Insys Therapeutics Inc. (NASDAQ:INSY) sentiments on Wall Street turned from bad to worse, after the embattled specialty pharmaceutical company responded to claims it fraudulently marketed a powerful painkiller. Shares of the company fell 9.35% to end Tuesday’s trading session at three-year lows.

Insys Therapeutics Inc. (NASDAQ:INSY)

Insys Therapeutics ‘’Fraudulent’ Practices

Investor confidence on the stock continues to hit lower lows after the New Jersey Attorney General accused the company of engaging in a conduct that is ‘nothing short of evil”.

A sell-off wave has pushed the stock to this year’s lows as it continues to trade in a strong downtrend. Insys Therapeutics Inc. (NASDAQ:INSY) is down by more than 10% for the year in an industry that is experiencing strong share growth.

Insys Therapeutics Inc. (NASDAQ:INSY) finds itself in hot water for allegedly directing its sales force to have doctors prescribe its drug, Subsys, for any chronic pain. A point of concern is that the drug was approved only for cancer patients who could not benefit from other opioids.

The lawsuit by New Jersey Attorney General, Christopher Porrino, also alleges that the company paid kickbacks, including sham speaker fees, to medical practitioners as it sought to push for more Subsys prescriptions.

The attorney general’s lawsuit insists that Insys Therapeutics Inc. (NASDAQ:INSY) put hundreds of lives in jeopardy with the illegal practices. One fatality has been reported of a woman who was prescribed Subsys for the treatment of fibromyalgia.

Insys Therapeutics Defense

Insys has quashed the allegations reiterating that Subsys prescription represented about 0.02% of the opioid prescriptions in the U.S. last year. The company says it is working with relevant authorities to resolve issues related to inappropriate action taken by its staff.

“The company is under new management and has replaced 90 percent of the original sales force and commercial organization. While understandable, it’s disingenuous to repeatedly demonize a company that has made a firm and sincere commitment and is taking all the necessary steps to conduct business according to high ethical standards,” Insys Therapeutics in a statement.

Insys Therapeutics Inc. (NASDAQ:INSY) employs about 400 people including scientists, researchers, and physicians who it says are dedicated to coming up with treatment options for various unmet patient needs. However, the company remains under intense scrutiny at a time when opioid abuse is a major public health issue. According to the U.S. Centers for Disease Control and Prevention, there were 33,000 deaths associated with opioid abuse in 2015.

I have no positions in any of the stocks mentioned, and have no plans to initiate any positions within the next 72 hours. All information, including any data, is provided without any guarantees of accuracy.

Don’t miss out! Stay informed on $INSY and receive breaking news on other hot stocks by signing up for our free newsletter!

About the author: James Marion is a University of Houston student studying Business with a concentration in Finance. James has interned with several investment professionals and hopes to pursue a career as a professional stock analyst after graduation.

Forterra Inc (NASDAQ:FRTA) Prospects Turn Sour

Forterra Inc (NASDAQ:FRTA)

Investor’s sentiments on Forterra Inc (NASDAQ:FRTA) have turned sour in the wake of management admitting they were struggling to generate organic growth. Ever since, the company has evoked a wave of class action lawsuits from law firms, all of which are questioning whether the management team violated its fiduciary duties.

Forterra Inc (NASDAQ:FRTA)
One month FRTA Stock Price Chart

Forterra Sell Off

Forterra Inc (NASDAQ:FRTA)’s stock was yet again on the receiving end in Thursday’s trading session after rating firm, Moody’s downgraded the company rating to B3 from B1 on concern that its outlook remains negative. Investors reacted by sending the stock down 4.60% to end the day at $3.32.

Forterra Inc (NASDAQ:FRTA) is currently trading near its all-time lows having shed more than 80% in market value since the start of the year. The sell-off wave now threatens to push the stock to its 52-week low as it continues to trade on the lower end of its $3.31-$3.60 trading range.

Fuelling the current sell-off is the company’s admission that it did not generate any organic growth in the first six months of the year. Forterra Inc. (NASDAQ:FRTA) reported net sales of $338.3 million for the first quarter up from $187 million the prior quarter. The company attributes the increase to the impact of acquisitions rather than organic growth.

Moody’s Downgrade

Moody’s concern about the company’s deteriorating operating results and credit metrics could continue to fuel the selloff wave given the risks at hand. The firm has also warned that the company’s credit profile could remain weak over the next 12 to 18 months.

“Forterra’s key credit metrics have deteriorated significantly over the last six months as debt increased and operating performance declined. The B3 corporate family rating (“CFR”) reflects our expectations for continued high debt leverage above 8.5x,” Moody’s rating in a statement.

Class Action Lawsuits

The negative outlook by Moody’s compounds Forterra Inc (NASDAQ:FRTA) woes in the market at a time when law firms are questioning its public statements. Law firms have lodged a class action investigation over claims the company failed to notify investors that its initiatives had failed to produce organic growth.

Also in question is whether Forterra Inc. (NASDAQ:FRTA) failed to notify investors that it was facing pricing pressures and operational problems at its plants. In addition, law firms are also investigating whether the company failed to disclose material weakness in internal controls relating to inventory accounting.

I have no positions in any of the stocks mentioned, and have no plans to initiate any positions within the next 72 hours. All information, including any data, is provided without any guarantees of accuracy.

Don’t miss out! Stay informed on $FRTA and receive breaking news on other hot stocks by signing up for our free newsletter!

About the author: James Marion is a University of Houston student studying Business with a concentration in Finance. James has interned with several investment professionals and hopes to pursue a career as a professional stock analyst after graduation.

Power Solution International, Inc. (NASDAQ:PSIX) Up 60% Amidst High Drama

Power Solution International, Inc. (NASDAQ:PSIX)

Power Solution International, Inc. (NASDAQ:PSIX) provides integrated turnkey powertrain solutions to original equipment manufacturers in the industrial, construction, agricultural, and on-road markets and offers a complete line of fuel-flexible, low-emission engines. The Wood Dale, IL-based company designs and markets clean, high-performance engines that run on a wide variety of fuels including natural gas, propane, biogas, gasoline, or hybrid systems to meet and exceed applicable environmental standards.

History

Power Solution International, Inc. (NASDAQ:PSIX) was trading above $80 in mid-2014. Today the shares closed the regular trading session up over 64% at $6.24.

In September, lawfirms were searching for clients to take part in a class-action lawsuit that alleged Power Solution International, Inc. (NASDAQ:PSIX) made false and misleading statements and/or failed to disclose that: the Company inappropriately recognized revenue for certain transactions; that the Company lacked adequate internal controls over financial reporting; and that as a result of the above, Power Solutions’ public statements were materially false and misleading at all relevant times.

On February 3, the NASDAQ announced that trading was halted today in Power Solutions International, Inc. at 11:53:45 Eastern Time for “additional information requested” from the company at a last sale price of $7.52. When trading resumes, the stock plummeted and closed the day down over 60% at $2.80. On February 6, 2017, Power Solutions International, Inc. (NASDAQ:PSIX) received notice from the Staff of the Listing Qualifications Department of The NASDAQ indicating that, based upon the Company’s continued non-compliance with the filing requirement set forth in Nasdaq Listing Rule 5250(c)(1), the Company’s securities would be subject to delisting from Nasdaq unless the Company timely requests a hearing before the Nasdaq Hearings Panel.

On February 10, Power Solutions International, Inc. (NASDAQ:PSIX)announced that it has appointed Frazier & Deeter, LLC (“Frazier & Deeter”) as its new auditor to succeed RSM US LLP.

Power Solutions International, Inc. (NASDAQ:PSIX) had been trading in the $3 handle since February 4 – until today when shares soared and ended the day at $6.24.

The Numbers

Power Solutions International, Inc. (NASDAQ:PSIX) sales have been steadily increasing since 2011 when the company reported $155 million in revenues. In 2015 that number improved to $389.4 million. Earnings have been inconsistent. 2013 showed an EPS loss of $1.92, but the next two years had positive per share earnings of $2.22 and $1.32.

Four firms follow Power Solutions International, Inc. (NASDAQ:PSIX), One rates the shares as a “strong Buy”, one rates the shares as a “Hold”, and two rate PSIX as a “Sell”.

I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 96 hours. All information, or data, is provided with no guarantees of accuracy.

2/16/2017
Ticker Symbol PSIX
Last Price a/o 4:00 PM EST  $                      6.24
Average Volume                    144,480
Market Cap (mlns)  $                    71.32
Sales (mlns) $365.10
Shares Outstanding (mlns) 11.43
Share Float (mlns) 4.8
Shortable Yes
Optionable No
Inside Ownership 58.97%
Short Float 39.59%
Short Interest Ratio 13.14
Quarterly Return -51.74%
YTD Return -16.80%
Year Return -45.17%

FXCM Inc. (Nasdaq: FXCM) Receives CFTC Death Sentence – Shares Crater

FXCM, Inc. – Nasdaq: FXCM

FXCM Inc. shares opened over 50% lower, on heavy volume, from yesterday’s settlement price on news that the Commodities Futures Trading Commission (CFTC) has banned the firm from servicing U.S. customers and forced the sale of its U.S. operations to Gain Capital Holdings (NYSE: GCAP) for an undisclosed sum. FXCM Inc. trades on the Nasdaq under ticker FXCM. Read the formal order from the CFTC here.

Founded in 1999 by Dror Niv and William Ahdout, FXCM provides retail investors and traders access to the Forex market through their proprietary technology platform. As of July 31, 2016, FXCM had over 20,000 active retail accounts representing over $170 million in assets. Prior to 2007, FXCM’s own dealing desk provided its clients provided with the needed liquidity. That model changed when FXCM adopted an “agency model” that was supposed to eliminate any conflicts of interest – essentially promising their clients to find the best market price available in the amongst many currency market-makers.

The CFTC claims that in 2009, Niv, Ahdout, and others created a trading system that would utilize an algorithm to replace or compete with the currency market-makers on FXCM’s new trading platform. In 2010, after the FXCM compliance department raised concerns, FXCM spun off the new market-making system to a company (HFT Co.) formed by the FXCM employee that helped create it. At the same time, FXCM provided an interest-free $2 million loan to HFT Co. for operating capital. Terms of that agreement included stipulated that FXCM would be the recipient of 70% of HFT Co.’s trading profits. Later, the terms were changed to a $21 payment to FXCM for every $1 million in trading volume that FXCM provided to HFT Co. The CFTC states that between 2011 and 2014, HFT Co. paid FXCM over $77 million under the label of “trading rebates”.

The CFTC document claims that FXCM was anticipating between 25% – 30% of all orders would be routed to HFT Co. However, in marketing materials FXCM did not even mention HFT Co. as one of their primary dealers – they listed the firm’s volumes under the label “Citi-Prime brokers – other”. FXCM did not disclose HFT Co. as one of their market-makers until 2012.

National Futures Association (NFA) compliance staff questioned Niv about FXCM’s relationship with HFT Co. and was told that the firm had no relationship with HFT Co. except for a prior relationship at another market-maker. That event began investigations into FXCM and HFT Co. which have now ended in the firm’s banishment from the American market based on the CFTC finding that, among other violations, FXCM Inc. misrepresented and/or omitted material information to their clients that would have revealed a beneficial financial relationship between one of their primary market-makers (HFT Co.) and the firm.

FXCM has agreed to pay a $7 million fine and to never seek a CFTC registration. Dror Niv and William Ahdout, have admitted to no wrongdoing but will voluntarily withdraw their CFTC registrations. Expectedly, lawsuits are being filed and potential plaintiffs (former FXCM clients) are being sought.

Shares of Gain Capital Holdings are up almost 5% at the time of this writing.

I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 96 hours. All information, or data, is provided with no guarantees of accuracy.

Stemline Therapeutics (Nasdaq: STML) May Face Lawsuit

Stemline Therapeutics Inc. – Nasdaq: STML

Stemline Therapeutics began trading on the Nasdaq on January 19, 2017 under the ticker STML. At least one law firm is rumored to be investigating whether Stemline violated Federal Securities Laws. The rumored law firm’s investigation may be related to reports that the company allegedly failed to disclose that they had knowledge, on January 18, 2017, of a patient’s death who was participating in a clinical of their cancer drug.

New York, NY-based Stemline Therapeutics, Inc. is a clinical stage biopharmaceutical company developing novel oncology therapeutics. They have three drugs in development – SL-401, SL-801, and SL-701. The U.S. Food and Drug Administration granted SL-401 Breakthrough Therapy Designation based on data from this ongoing trial, which is demonstrating high overall response rates. A Phase 1 trial is open and enrolling patients with advanced solid tumors, and a Phase 1 trial in hematologic malignancies is planned for SL-801. SL-701 is an immunotherapy designed to activate the immune system to attack tumors. A Phase 2 trial with SL-701 is currently ongoing in adult patients with second-line glioblastoma multiforme.

Stemline Therapeutucs sales have increased every year since 2013. In 2015 they reported $700k in sales. STML shares have never experienced positive EPS and for the past three years STML shares have lost between $2.15 and $2.35. STML shares are rated as a “Strong Buy” from all five analysts that cover the stock. Their consensus price target for STML is $28.50.

I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 96 hours. All information, or data, is provided with no guarantees of accuracy.

2/2/2017
Ticker Symbol STML
Last Price a/o 12:29 PM EST  $                      6.02
Average Volume                    227,330
Market Cap (mlns)  $                  230.59
Sales (mlns) $0.90
Shares Outstanding (mlns) 23.65
Share Float (mlns) 21.29
Shortable Yes
Optionable Yes
Inside Ownership 1.70%
Short Float 6.31%
Short Interest Ratio 5.91
Quarterly Return -14.47%
YTD Return -8.88%
Year Return 110.13%

Banc of California (NYSE: BANC) In Troubled Times

Banc of California, Inc. – Nasdaq: BANC

A SeekingAlpha.com blog alleged, in October, 2016, that Banc of California was involved in deceiving its shareholders. Four things followed – the CEO resigned, the SEC opened an investigation into the claims, a class-action lawsuit was filed, and an activist shareholder has emerged to demand a sale of the bank. The price action that followed was swift and depressing for shareholders. BANC shares lost about 50% of their value.

Within the four months that preceded the allegations, two insiders had sold BANC shares worth almost $2 million. Fast forward to this morning in which investors saw FBR upgrade their rating to “Outperform”. Analyst coverage has been, curiously, never negative, with a single exception, on BANC shares since 2012. The single exception was FIG Partners downgrading the shares to underperform in August of 2016 and they recently improved their rating to “Market Perform”. 

In the middle of this is Jason Galanis. In press reports addressing the events surrounding Banc of California, it is alleged that Mr. Galanis has a “long history of secretly gaining control of banks and public companies via front men, looting assets, and leaving unsuspecting investors and taxpayers with hundreds of millions in losses.”

Reported EPS and sales for BANC shares have been steadily increasing in the past three years. It should be noted that volumes have been lower than average in recent days.

I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 96 hours. All information, or data, is provided with no guarantees of accuracy.

 

Endo International plc. (Nasdaq: ENDP) Settles FTC Lawsuit – Shares Continue Slide

Endo International plc. – Nasdaq: ENDP 

Shares of Ireland-based Endo International plc. continue their 2017 slide. ENDP shares, traded on the Nasdaq, have lost around 1/3 of their value this year. Today Endo International settled allegations that Endo Pharmaceuticals violated antitrust law when it agreed to pay rivals Watson Laboratories and Impax to delay introducing generic versions of two painkillers. The FTC’s complaint, filed in the U.S. District Court for the Eastern District of Pennsylvania, alleged that certain aspects of the Opana® ER and Lidoderm® settlements constituted unfair methods of competition in violation of federal law and sought injunctive and declaratory relief, as well as other remedies including restitution and disgorgement. 

Endo develops, manufactures, markets and distributes quality branded pharmaceutical and generic pharmaceutical products as well as over-the-counter medications through its operating companies worldwide. 

Eighteen firms follow Endo International. Seven rate ENDP as a “Strong Buy”, one rates the shares a “Buy”, and ten rate ENDP as a “Hold”. The consensus price target is $20. 

I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 96 hours. All information, or data, is provided with no guarantees of accuracy.

1/23/2017
Ticker Symbol ENDP
Last Price a/o 3:26 PM EST  $                    12.10
Average Volume 5.72 million
Market Cap $2.8 Billion
Sales $3.84 Billion
Shares Outstanding 233 million
Share Float 221.48 million
Shortable Yes
Optionable Yes
Inside Ownership 0.20%
Short Float 6.29%
Short Interest Ratio 2.43
Quarterly Return -37.96%
YTD Return -25.08%
Year Return -78.11%

Forward Pharma (Nasdaq: FWP) Receives $1.25 Billion Lawsuit Settlement From Biogen

Forward Pharma – Nasdaq: FWP

Forward Pharma shares rocketed up over 60% from their Friday close of $18.35 on news of a patent-infringement lawsuit settlement with Biogen (BIIB). The Danish company trades on the Nasdaq as an American Depository Share (ADR). According to reports, Biogen will pay Forward Pharma $1.25 Billion to settle the ongoing lawsuit over their multiple sclerosis drug Tecfidera.

Forward Pharma is a Danish biotechnology company focused on the immunomodulatory compound dimethyl fumarate and derivatives, for applications as a pharmaceutical drug product to treat immune disorders such as multiple sclerosis and psoriasis. Major partners listed on Forward Pharma’s website include venture capital firms such as Nordic Biotech, Rosetta Capital, and BVF Partners.

Two firms follow Forward Biopharma and each rate FP shares as a “Strong Buy” despite no reported sales and negative EPS since 2012. Their consensus price target for FWP is $42.50.

I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 96 hours. All information, or data, is provided with no guarantees of accuracy.

1/17/2017
Ticker Symbol FWP
Last Price a/o 11:29 AM EST $27.99
Average Volume 9,500
Market Cap $853 million
Sales
Shares Outstanding 46.5 million
Share Float 10.5 million
Shortable Yes
Optionable No
Inside Ownership
Short Float 0.83%
Short Interest Ratio 9.14
Quarterly Return -11.57%
YTD Return 22.33%
Year Return 18.46%

Telenav Inc. (Nasdaq: TNAV) Rises on Lawsuit Settlement

Telenav, Inc.– Nasdaq: TNAV

Telenav, Inc. announced that it has settled a lawsuit accusing the firm of patent infringement brought by Vehicle IP, LLC. The one-time payment of $8 million will have a material impact on 2016 Q4 results. Telenav, Inc. is a provider of location based services including voice guided navigation, on mobile phones.

Telenav Inc. trades on the Nasdaq under the ticker TNAV. News of the settlement sent TNAV gapping up from its Thursday close of $7. Today TNAV opened at $8.10 and reached as high as $8.70 on heavy volumes.

In the press release Michael Strambi, Chief Financial Officer of Telenav stated “We experienced higher than expected revenue for the December quarter, which was driven by increases in both our Auto and Advertising businesses. However, operating expenses were greater than anticipated due to the one-time settlement and license fee.  At December 31, 2016, we had cash and short-term investments of $103.7 million.  The payment for the settlement will occur during January 2017.  As of September 30, 2016, we had accrued a liability of $850,000 related to the case, so the settlement’s impact on the December quarter will be reduced by that accrued amount.  We will provide our full financial results on our earnings call scheduled for January 31st.” The company will report results for the second quarter fiscal 2017 on Tuesday, January 31, 2017 with an investor conference call and live webcast at 2:00 p.m. PT (5:00 p.m. ET). To access the conference call, dial 877-795-3648 (toll-free, domestic only) or 719-325-4755 (domestic and international toll) and enter pass code 5663996.

Telenav Inc. is followed by four firms. All four rate TNAV as a “Strong Buy” with a consensus price target of $10.75. For 2016 Telenav Inc reported an EPS loss of $0.85 down from their reported 2015 EPS loss of $0.58. However, sales improved during that period. In 2015 holders of TNAV saw reported revenues of $160.2 million and in 2016 reported revenues were $183.3 million

I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 96 hours. All information, or data, is provided with no guarantees of accuracy.

1/13/2017
Ticker Symbol DXCM
Last Price a/o 10:22 AM EST  $                      8.23
Average Volume 82,200
Market Cap $297 million
Sales $181.5 million
Shares Outstanding 42.5 million
Share Float 26.53 million
Shortable Yes
Optionable Yes
Inside Ownership 4.40%
Short Float 1.22%
Short Interest Ratio 3.95
Quarterly Return 21.95%
YTD Return -0.71%
Year Return 35.40%