3SOF

Breakout with 3 times 50 day avg volume after 3 weeks of a base !!!! I like this one

Stock of the day...

Ascending triangle breakout...

LOOKING GOOD !

We will see REALDEALS21   ...A long base is formed...We remains BULLISH still support is not broken..

NABI has a huge gap to fill once it gets above 7.15.  Volume was more than double average today.  I've had this in my 401k for some time now.

NABI finishing the CUP.  A close above 7.15 would put $11 in play.

1. Introduction

This is an interesting thread (and stock chart  ), I hope gambler really did get back in this stock around $3.3 in December 05, because it's 100% plus above that now. Let me apply my analysis template to NABI.

2. Profile

Nabi Biopharmaceuticals engages in the development and marketing of products for Gram-positive bacterial infections, hepatitis, kidney disease, and nicotine addiction ... (complete profile here)

3. Technical Analysis
3.1. All History Chart



Jesus, NABI has been around at least since 1980 (my database only goes back to 1980). Not much far away from the price it was 26 years ago

3.2. Medium Term Chart

That is a gigantic gap, not unusual in biotech stocks. The gap will be closed only when the stock prints $11.8.



3.3. Short Term Chart



If the stock is able to cross the $7.15 resistance level, as Melf Elf says, $9.67 will be in play. ($9.7 is the technical target of this pattern bullish breakout, which is the $7.15 resistance level minus the $4.63 low of the correction equals $2.52 plus $7.15 you get the $9.67 target).

4. Fundamental Analysis
4.1. Number of Shares Outstanding



As most pharmaceutical and biotech companies, when they lose money on operations they look to the stock market for financing. But, not significant dilution over the last 3 years, which is a positive factor if we want to see the share price advance.

The current market cap is 60,453,348*$7.07 = $427.4 M.

4.2. Liquidity



The current ratio (current assets/current liabilities) looks healthy at 3.37 here. But there are $109 M in long term convertible debt.

4.3. Revenues



Revenues are shrinking and they're below what they were 12 years ago. But, the price to sales ratio is just $427.4 M/$109 M = 3.92, and the biotechnology industry average is 21.07 

4.4. Profits



These guys surely know how to lose money, as most biotechs. But, being around for about 30 years, they should do better ... Anyway, I've seen companies with a larger market cap that never made a sale, just on pipeline.

4.5. Recent News

As I read their latest 10-Q, I see this:

«On October 12, 2006, we executed a definitive agreement to sell certain assets related to our PhosLo operations to a U.S. subsidiary of Fresenius Medical Care for consideration of up to $150 million in up front cash, milestone payments and royalties on sales of a new product formulation under development. Refer to Note 15.»

This news was significant (Nabi Closes PhosLo Sale With Fresenius), with $65 M in cash upfront - the stock rose 6.7% on the day after (even though the news was expected).

It looks like they bought it for $30 M and now sell it for 5 times more money: «In conjunction with the acquisition of PhosLo in August 2003, we entered into an obligation to pay the seller $30.0 million over the period ending March 1, 2007. As of September 30, 2006, our remaining obligation, net of discount, was $10.5 million which will be paid on or about March 1, 2007.»

This sale won't have any impact on cash flow since PhosLo is cash flow neutral for the company.

Here's the company's pipeline.

5. General Overview

I really have trouble when it comes to valuing biotech companies, but NABI seems more attractive than others that I've seen. I'll ask Michael to help on this  one, since I consider him an expert on the field.

Thanks David for your analysis.

Nabi broke above 7.15.  Onward through the open Gap.