Sarepta Therapeutics Inc

Sarepta Therapeutics Inc (NASDAQ: SRPT) is a biotechnology company focused on developing drugs for infectious diseases and a diverse range of other diseases.

Investment Rationale – WATCH at USD 69.11

• On the profitability front, the consensus estimates indicated that the Company would continue to remain loss-making for three more years (FY21 to FY23).
• Despite reporting an increase in Q1 FY21 revenue, the Company had incurred a net loss more than the revenue.
• The write-offs of certain batches of EXONDYS 51 had resulted in an increase in the cost of sales during Q1 FY21 as compared to Q1 FY20.
• From a technical standpoint, SRPT is sustaining lower than the 20-days exponential moving average of USD 71.81, indicating a correction in the stock price.

One Year Share Price Chart

 (Data Source: Refinitiv, Analysis by Kalkine Group)

Conclusion

Based on the weak profitability and lower top-line revenue, we have given a “WATCH” recommendation on Sarepta Therapeutics Inc at the closing market price of USD 69.11 (as of 22 July 2021).

Lithium Americas Corp

Lithium Americas Corp (NYSE: LAC) is a Canada-based resource company with operational projects in Argentina and Nevada.

Investment Rationale – WATCH at USD 13.65

• With regards to the top-line business, the Company had not generated any revenue from the last three years and Q1 FY21 as well.
• The consensus estimates had indicated that the Company would remain loss-making for the next five quarters.
• The stock is highly volatile as it dropped by more than 45% from a 52-weeks high reached on 19 January 2021.
• From a technical standpoint, the MACD line fell below the signal line, indicating a correction in the stock price.

One Year Share Price Chart

 (Data Source: Refinitiv, Analysis by Kalkine Group)

Conclusion

Based on the negligible top-line business and weak profitability, we have given a “WATCH” recommendation on Lithium Americas Corp at the closing market price of USD 13.65 (as of 22 July 2021).

XL Fleet Corp

XL Fleet Corp (NYSE: XL) is the provider of fleet electrification solutions for commercial vehicles in North America. 

On 21 December 2020, a special purpose acquisition entity, Pivotal Investment Corporation II, completed the business combination with XL Fleet and began trading from 22 December 2020 as a combined entity under the ticker symbols "XL". Therefore, the earlier given recommendation on the delisted entity-Pivotal Investment Corporation II was closed at the closing price on the last trading day i.e., 21 December 2020, at USD 19.54.

Investment Rationale – Avoid at USD 6.97

• With regards to the top-line business, the Company had posted a decline in revenue from USD 1.23 million during Q1 FY20 to USD 0.68 million for Q1 FY21.
• The shortage of semiconductors may increase the cost levels and hamper the growth prospects.
• On the profitability front, the Company had widened the net loss by more than four times during FY20 as compared to FY19.
• On a YTD basis, the stock price plunged almost 65%.
• From a technical standpoint, XL is trading lower than the 20-days exponential moving average of USD 7.32, indicating a correction in the stock price.

One Year Share Price Chart

 (Data Source: Refinitiv, Analysis by Kalkine Group)

Conclusion

Based on the volatile nature of the stock and a drop in top-line revenue during Q1 FY21, we have given an “AVOID” recommendation on XL Fleet Corp at the closing market price of USD 6.97 (as of 22 July 2021).

*The reference data in this report has been partly sourced from REFINITIV.

Disclaimer

The advice given by Kalkine Canada Advisory Services Inc. and provided on this website is general information only and it does not take into account your investment objectives, financial situation and the particular needs of any particular person. You should therefore consider whether the advice is appropriate to your investment objectives, financial situation and needs before acting upon it. You should seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) as necessary before acting on any advice. Not all investments are appropriate for all people. The website www.kalkine.ca is published by Kalkine Canada Advisory Services Inc. The link to our Terms & Conditions has been provided please go through them. On the date of publishing this report (mentioned on the website), employees and/or associates of Kalkine do not hold positions in any of the stocks covered on the website. These stocks can change any time and readers of the reports should not consider these stocks as advice or recommendations later.