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Kempharm, Plug Power, and Weekly Highlights


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RECAP OF LAST WEEK AND RESULTS:


Palantir: We called PLTR to reach $31 a share. We missed our one-week prediction and the stock fell this week due to a broad market correction. It is currently sitting at $24.56 a share. This company still has high conviction in the long term due to the vast amount investing into themselves for AI. We expect them to grow their business substantially in the coming year. 


Ree Automotive: We called VCVC to go to $13 a share from $12.43. We missed the price direction, and it is down to $11.36. Ree Automotive, will become more of a player after they announce their earnings reports which will give investors more insight into how they are progressing with their autonomous car chassis skateboards. They need to show execution in manufacturing as well. They recently finished construction of an engineering center and should expand to manufacturing in the next year or 2.


Investor Mentions Last Week:

Bitcoin, we mentioned how it could still rise in value, we were very cautious about it since the extreme monthly increase in value. As of writing it is $46,000 per coin, which is $10,000 less than last week. 

Gamestop, we mentioned how this could surge and GME doubled in price again. It could still double again this week as well. 


IN THIS ISSUE


Kempharm

This novel ADHD drug maker has an FDA approval date on Tuesday, March 2nd.


Plug Power

Energy stock, could continue to grow after an earnings revenue beat expectations.


Weekly Highlights

Why did the broader market decline? What’s next? The Stimulus passed the house, it is likely stocks will go up this week.

Kempharm: KMPH

This is a biotech company that has an FDA approval target date on Tuesday, March 2nd. They are focusing on the ADHD market which has around 18 billion dollars every year. If approved, this 300-Million-dollar company could double or even triple as they may be able to take a percentage of the ADHD market if their drug is proven to be as good as their largest competitor Vyvanse. This is the first time in a decade, another drug that treats ADHD has a differentiated molecule that stands separate from its competitors. 


Price Forecast

Current Price: $9.85

One Week Target: $16

One Month Target: $13

One Year Target: $25


This company has a high potential to double in value and even has the potential to be bought out as they may be serious competition for Vyvanse in the ADHD market if they are approved by the FDA on Tuesday. 


Click Here for an Option Idea

Plug Power: PLUG

Plug Power Inc. is an American company engaged in the development of hydrogen fuel cell systems that replace conventional batteries in equipment and vehicles powered by electricity.” But we wanted to take a deeper dive into Plug Power. This company has been around since 1997 and has its headquarters in New York. It has been publicly traded since 1999 and up until the summer of 2020, this stock was under $4 a share. The stock is now sitting at $47.60, an increase of over 1000% this year. The Plug did pull back about 27% this past month with the rest of the “growth sector” stocks. However, The Plug reported their earnings on Thursday.


They reported the following: “2020 marked a record year in gross billings, with Q4 gross billings of $96.3 million and $337 million for the full year reflecting the Company’s strong value proposition in the growing hydrogen industry.” A good sign for investors. They also reported a "Strong balance sheet with now over $5 billion in cash to execute on its global growth strategy and objectives.” They did however report a negative revenue of 100 million for the year directly related to customer warrants being paid off. This will no longer be an issue moving forward which should allow Plug Power to become profitable very soon. 


Price Forecast

Current Price: $47.60

One Month Target: $53-55

One Year Target: $75

Two Year Target: $150


We think this stock has had an incredible run in the past year, but we believe that it has more room to go up. As we search for cleaner energy sources Plug Power will just continue to thrive. Plug Power was the first to create a market for hydrogen fuel cells and they are doing an excellent job at leading the pack. They have also set themselves up to grow in the future. They “Added a fourth pedestal customer and selected the site for gigafactory to drive scale,” which could lead to more pay off down the road. As long as Plug Power can stay ahead of their competitors, I think they will control the hydrogen fuel cell market. They are working on their global presence and I think that should also set them up to win. The negative side of this stock is the fact that it has had such a large run in the last year that the value of the stock could be overvalued. The Plug will need to continue to perform for investors to stay committed. However, the value of the stock has shot up so much because investors do see the potential that a company could have. 


This stock is a high-risk/high reward investment to me. The market for hydrogen fuel cells could change completely and has several factors that will make or break this sector. They plan to be profitable by 2024 and “With the latest Renault and SK Group partnerships, it looks better-placed to achieve that target.” If you have a high-risk tolerance and plan to hold your stocks for 4-5 years, I think this stock could be a great investment. 


Click Here for an Option Idea

Weekly Highlights: What Happened This Week? What’s Next?


Gamestop Madness Ensues and Could Surge in Price Again

Gamestop surged in value over $180 again this past week and has the potential to go into the 1000’s. This has happened before in 2008 with a company called Volkswagon. We are very cautious about this situation because it does have implications affecting the market surrounding it. If for instance, this was to reveal a market inefficiency, it could hurt the market confidence and people would move money away. We saw last week money was moving out of the stock market and into bonds as the treasury yields are going back up in value. 


1.9 Trillion-Dollar Stimulus Bill Passed the House

If this bill is passed by Congress, this will inject liquidity into the stock market and the market will undoubtedly rise. After this past week’s correction, we think the market could go back up with hopes of stimulus being injected again.


Aurinia Pharmaceuticals Had an Earnings Report This Week

We have been following this company closely as they are launching their newly approved drug Lupkynis to the market. This will help treat Lupus nephritis, a form of systemic Lupus.

We maintain a high conviction on this stock price doubling anytime within the next 3-6 months.  They are a potential buyout candidate and have a great team that is pushing to launch the drug as quickly as possible. We will see their script numbers and sales number at the next earnings call in 3 months which will ultimately move the stock to its true value of $25-35 a share. AUPH Option Idea Here.


Athenex FDA Approval of Their Oral Metastatic Breast Cancer Drug is This Week

This company is on the deck to have their drug approved by the FDA by today, February 28th. This approval could send shares soaring above $20. Athenex current stock price is $12.10. Another interesting aspect of this company is that they are generating revenue and if they can succeed with the FDA, they should maintain a cash flow positive for years to come.  If they are not approved, we should see the stock fall to around $8 a share because they still have revenue and a large drug pipeline which has some speculative value.


All stocks talked about we have invested in, and do not intend to give advice nor recommend acting upon the information.

Thanks for joining us. If you find this information helps you, please share it with someone else! It will help us out greatly.

Until next week,

Brad Mitchell

Colby McCoy

and the Optifinancial Team

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