Emergent BioSolutions Inc

Emergent BioSolutions, Inc. (NYSE: EBS) is a life sciences company providing preparedness and response solutions addressing accidental, deliberate and naturally occurring public health threats (PHTs). Its segments include Products Segment and Services Segment.

Recent Business and Financial Updates:

• Q2 2023 and Recent Business Highlights
  • CEO Transition and FDA Approval: Haywood Miller appointed as Interim CEO after Robert G. Kramer's retirement. FDA approved CYFENDUS, a two-dose anthrax vaccine for post-exposure prophylaxis.
  • Travel Health Business Sale: Concluded sale of travel health business to Bavarian Nordic for up to USD 380 million, facilitating asset and program transfer under a Transition Services Agreement.
  • Credit Facilities Extension: Extended maturity of senior secured credit facilities through an amendment.
  • Ebola Treatment Contract: Awarded a 10-year contract for advanced development and manufacturing of Ebola treatment Ebanga.

• Q2 2023 Financial Performance
  • Anthrax MCM: Revenues decreased by USD 74.6 million YoY due to CYFENDUS and BioThrax® timing impacts, partially offset by higher Anthrasil® sales.
  • NARCAN: NARCAN® Nasal Spray revenues grew by USD 32.3 million YoY driven by higher branded NARCAN sales, partially offset by reduced commercial retail sales.
  • Smallpox MCM: Revenues rose by USD 107.9 million YoY due to a USD 120 million option exercise by the U.S. government for ACAM2000, offset by lower VIG sales timing.
  • Other Products: Sales declined by USD 0.6 million YoY, primarily due to reduced BAT sales but partly offset by higher RSDL sales.
  • CDMO: Contract development and manufacturing services revenue increased by USD 23.7 million YoY, driven by work at the Canton facility and resolution of an outstanding obligation.
  • CDMO Leases: Lease revenue grew by USD 7.2 million YoY, linked to the Canton facility, while prior-year revenue reversal was associated with the Janssen Agreement termination.
  • Gross Capital Expenditures: Capital expenditure decreased due to reduced product development activities across facilities.
  • ATM Program: Initiated "at-the-market" equity offering program, selling 1.1 million shares for USD 9.1 million gross proceeds at an average price of USD 8.22 per share.

Technical Observation (on the daily chart)

With a past year return of correction of almost 81.67%, the price has been in a persistent downward trend over the last year, with the medium-term also negative trend evident by a correction of 40.30% in previous three months. The price has broken down a decent support of USD 6.50-USD 7.50, with the current price levels near an important support of USD 5.00- USD 5.50. Also, the momentum indicator RSI (14 period) displays an oversold value of 30.32, indicating some consolidation or a short-term upward movement. Price is also below to the 21-day SMA and 50-day SMA trend-following indicators, which can serve as dynamic short-term resistances.

Individuals can evaluate the stock based on the support and resistance levels provided in the report in case of keen interest taking into consideration the risk-reward scenario. 

Markets are trading in a highly volatile zone currently due to certain macro-economic issues and prevailing geopolitical tensions. Therefore, it is prudent to follow a cautious approach while investing. 

Related Risk: This report may be looked at from a high-risk perspective and a recommendation is provided for a short duration. This report is solely based on technical parameters, and the fundamental performance of the stocks has not been considered in the decision-making process. Other factors which could impact the stock prices include market risks, regulatory risks, interest rates risks, currency risks, social and political instability risks etc. 

How to Read the Charts?

The Green colour line reflects the 21-period simple moving average (SMA) while the red line indicates the 50- period simple moving average (SMA). SMA helps to identify existing price trends. If the prices are trading above the 21-period and 50-period moving average, then it shows prices are currently trading in a bullish trend.

The Black colour line in the chart’s lower segment reflects the Relative Strength Index (14-Period) which indicates price momentum and signals momentum in trend. A reading of 70 or above suggests overbought status while a reading of 30 or below suggests an oversold status.

The Blue colour bars in the chart’s lower segment show the volume of the stock. The volume is the number of shares that changed hands during a given day. Stocks with high volumes are more liquid than stocks with lesser volume as liquidity in stocks helps in easier and faster execution of the order.

The Orange colour lines are the trend lines drawn by connecting two or more price points and used for trend identification purposes. The trend line also acts as a line of support and resistance. 

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock. 

Resistance: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Resistance 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Resistance 2 may act as the crucial resistance level for the stock. 

Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices. 

The reference date for all price data, currency, technical indicators, support, and resistance levels is August 11, 2023. The reference data in this report has been partly sourced from REFINITIV. 

Abbreviations

CMP: Current Market Price

SMA: Simple Moving Average

RSI: Relative Strength Index

USD: United States dollar 

Note: Trading decisions require a thorough analysis by individual. Technical reports in general chart out metrics that may be assessed by individuals before any stock evaluation. The above are illustrative analytical factors used for evaluating the stocks; other parameters can be looked at along with additional risks per se. Past performance is neither an indicator nor a guarantee of future performance.

Disclaimer

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