On june 12th GNBT surged on on huge volume after IB firm Rodman and Renshaw associates initiated coverage with a “market outperform” and an 18 month price target of $6. Speculation mostly revolves around there Oral-Lyn non injectable insulin intake device. Rodmen and Renshaw speculate that given the forcasted growth in the diabetic population and Oral-Lyns strong clinical data findings will make this an alpha product which could possibly bring in $600m in sales by 2013.

Technical Analysis of this chart looks very bullish to me as well. After price made its initial surge on the upgrade profits have been taken which lead price to retrace towards the midpoint of the breakout candle which is usually serves as strong support, as well signifies bullish continuations if a rebound comes into play. It just so happens that GNBT made a strong rebound near the midpoint of the breakout candle forming a bullish hammer candle followed by the strong rally during Fridays session in the face of the bear. Currently as i’m typing price is up 11% premarket about 5 minutes before the opening bell so we missed the optimal entry, though i will follow this one close this week for possible entry as i think the momentum and speculation could drive this higher.

Quote from analyst:
“Jaikaria said Generex’s oral insulin candidate could bring in more than $600 million in sales in its first three years.

Jaikaria expects Generex to begin late stage clinical trials of Oral-lyn for people with Type I diabetes later this year, with the Food and Drug Administration approval coming in 2010. He said the drug could be more effective than inhaled insulin products, and may be useful to patients with Types I and II diabetes.

“We believe that Generex’ Oral-lyn has advantages over other non-injectable insulin solutions,” he said. “While many of these systems deliver insulin to the lungs and bronchial tree, Oral-lyn delivers insulin to the oral mucosa, avoiding the potential risks of chronic lung tissue exposure to insulin.”

The Centers for Disease Control and Prevention the number of Americans with diabetes will more than double by 2050, to 48 million, the analyst noted.

Jaikaria said the rising number of diabetics will create a large market for Generex. He projected the worldwide market for insulin growing to $12 billion by 2010.”

This entry was posted on Monday, June 25th, 2007 at 1:26 pm and is filed under Speculative Stock Analysis. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.