Thermogenesis (KOOL) popped in the last hour of trading on Wednesday. The stock ended regular hours trading at $3.13, up more than 16%, but after-hours trading gave back almost 10%. Then it took that 10% back and is now trading at $3.17. What's going on? For one, the stock seems over-sold. Thermogenesis announced lower than expected numbers in its second quarter financial report, due to an unexpected manufacturing problem, which created a backlog of orders for disposable bags used with the AutoXpress system. The company could not deliver on GE Healthcare's (GE) orders. But the problem seems to have been fixed, according to the company, and orders should be filled quick enough to reflect on the third quarter report. Posted on Mar 4th, 2007 with stocks: KOOL Thermogenesis (KOOL) announced early Friday that the company has increased its manufacturing capacity for the cord blood stem cell disposable bags for use with the AutoXpress system. The company can now produce as many as 2,000 disposable bag sets per week, or more than 100,000 per year. In early February, the company released disappointing 2nd quarter numbers. Executives blamed a manufacturing capacity shortfall that caused a large backlog in orders of the disposable bags. This latest announcement, if in fact a fix, means that Thermogenesis could see enough days of increased production and sales prior to filing the next quarterly report. The recent sell-off in the markets has also dampened investor optimism, as Thermogenesis stock has crashed from the $4-$5 price range all the way down to around $2.60 just recently. 50% of outstanding shares were held by institutional investors, some firms had a change of heart following the last quarterly report. Things could turn around just as fast, however. On Monday, the company announced it has received three key patents for both its cord blood stem cell storage system, AutoXpress, and its surgical wound care unit, CryoSeal System. Early on Wednesday, the stock received a buy recommendation from Maxim Group medical technology analyst Michael Tu with a price target of $5, more than 66% above the current price level. While that price target might seem a little too optimistic, consider the fact that Thermogenesis was hovering around $5 prior to its last quarterly report, only three months ago. The manufacturing problem has been fixed, so that large drop cannot be justified based on that issue alone. General Backround* The Cord Blood Industry is an interesting place in Biotech-- stem cells are being saved left and right here are the major players. There are a couple ways to invest in the cord blood industry, the cord blood banks and the companies that use cord blood to develop cures. Here are several stocks that participate in the cord blood business. Please note, most of these companies have low market caps and are extremely speculative. Cord Blood America Inc. [CBAI.OB]: One of the cord blood bankers, this Los Angeles company is involved in the collection, testing, processing, and preservation of the blood from umbilical cords for use in future stem cell therapy. It owns the Cord Partners umbilical cord blood banking company. Negative earnings, P/S is 1.7. Quarterly revenue growth year over year is 177%. Negative book value. ThermoGenesis (KOOL): This California company designs, makes, and sells automated blood processing systems for the manufacture, preservation, and delivery of cell therapies. It is involved in a joint venture with GE Healthcare, a unit of General Electric Company (GE) to distribute the AXP[TM] AutoXpress Platform, a closed and automated system for harvesting mononuclear cells from cord blood. P/S 13.6. Quarterly revenue growth year over year is 18.8%. Cryo-Cell International (CCEL.OB): This is a Florida based cord blood stem cell bank, specializing in the family market. P/S is 1.7. Quarterly revenue growth year over year is 15.2%. ViaCell (VIAC) This Cambridge, Massachusetts company sells ViaCord, a product which is used to preserve baby umbilical cord blood. They also research and develop other therapeutic uses of umbilical cord blood-derived and adult-derived stem cells. Negative earnings, P/S is 3.9. Quarterly revenue growth year over year is 25.9%. Celgene (CELG): This New Jersey company is involved in the discovery, production, and marketing of therapies designed to treat cancer and immune-inflammatory-related diseases. It owns LifeBank USA, a cord blood bank. P/E is 316, P/S is 21. Quarterly revenue growth year over year is 84.1%. Quarterly earnings growth year over year is 483%. Personally my family used Viacell & I think they are the best company... but Kool looks to be the best investment and that's what matters here.
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