PCSA - Don't Forget to Lock 'em In
2024-01-30 09:49:29 ET
DENVER, Colo., Jan. 30, 2024 ( www.247marketnews.com )- Processa Pharmaceuticals (NASDAQ: PCSA) and Rail Vision (NASDAQ: RVSN) are mentioned in this editorial.
Against the odds, you’re finally riding the big wave, but, just like surfing, there may be danger just beneath the surface.
We just witnessed a great example of this, on Thursday, when Processa Pharmaceuticals (NASDAQ: PCSA) reported that it successfully completed its safety tolerability evaluation in its Phase 1b trial of Next Generation Capecitabine and that “NGC-Cap was better tolerated with positive preliminary efficacy results than FDA-approved capecitabine.”
Additionally, Processa Pharmaceuticals announced that two dosage regimens were selected for the Phase 2 trial, from the Phase 1b data, which will be in advanced or metastatic breast cancer given FDA’s agreement that the Phase 1b data can be used to support the design of the Phase 2 trial in breast cancer.
Thanks to a quick text from an editor, we were alerted to Processa’s news, just after the release, and covered it in the premarket, when it was trading at $2.8594, up $0.8094 (+39.48%), on 641.6K shares traded. Since it new a 52-week low the day before and was trading well above that level, it was probably forcing a lot of short covering.
It opened the regular session at $3.65 and made several runs past $5, including that day’s high of $5.9099, before closing at $5.10, up $3.05 (+148.78%), on trading volume of 73.3M shares traded.
Most Small Caps are Underfunded and Ready to Drop the Funding Anvil on their Shareholders’ Heads
Whenever there’s a big run up, it’s imperative that investors check the company’s cash position, as identifying potential pitfalls could save lots of headache and face first splat onto the hard Wall Street floor.
In Thursday’s wrap up, we suggested to “Keep an eye on this one, because it’s trading well in the aftermarket, after hitting a new a 52-week low yesterday, so there may be some shorts taking a beating, but keep the other eye on a potential funding move.”
So, the shareholders who held on through Processa’s recent 1:20 reverse split were rewarded with the news, late in Friday premarket trading, Processa Pharmaceuticals stated that it executed a $7 million raise, in a public offering of 1,555,555 shares of common stock, or pre-funded warrants, and common warrants to purchase up to 1,555,555 shares of its common stock, at a combined public offering price per share of common stock and accompanying common warrant of $4.50, which is expected to close this week.
Processa Pharmaceuticals closed yesterday’s trading at $2.78, down another 89-cents (-24.25%), providing another example of why catching the wave isn’t enough, you have to lock in the profits.
Conversely, Rail Vision (NASDAQ: RVSN) began to run hard, last week, after announcing that its Main Line system successfully obtained formal certifications for critical European Union railway standards.
We originally thought that it was best to consider it as a scalp trade, but as it started to force the shorters to cover, the gains began to attract additional shorters who created a short squeeze rally.
We warned that Rail Vision was outrunning its support, on Tuesday, and at one point on Wednesday it was down 50% from Tuesday’s high.
Fortunately, the shareholders who held were bailed out by another rally and they’re now looking like geniuses, as the stock is hitting new 52-week highs.
However, the savvier traders who recognized the signals sold on Tuesday, before the big drop and spotted the buy signal. Those who did, locked in some nice profits and are still riding the same wave on some “free” shares.
The bottom line is that it’s often better to move too quick and, if necessary, look for your reentry point, as opposed to holding too long and pray for a bailout.
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Cautionary Statement Regarding Forward Looking Information
Statements in this press release about the Company’s future and expectations other than historical facts are “forward-looking statements.” These statements are made on the basis of management’s current views and assumptions. As a result, there can be no assurance that management’s expectations will necessarily come to pass. These forward-looking statements generally can be identified by phrases such as “believes,” “plans,” “expects,” “anticipates,” “foresees,” “estimated,” “hopes,” “if,” “develops,” “researching,” “research,” “pilot,” “potential,” “could” or other words or phrases of similar import. Forward looking statements include descriptions of the Company’s business strategy, outlook, objectives, plans, intentions and goals. All such forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those in forward-looking statements. This press release does not constitute an offer to sell or the solicitation of an offer to buy any security.
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Don’t Forget to Lock ‘em In