GW Pharmaceuticals plc a pure play on cannabinoid therapeutics

Aug 13th, 2014 – Comment

At this juncture the momentum indicators are not providing clarity as to direction.


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Lou Schizas is an equities analyst, investor, entrepreneur, professor and television and radio personality – and a true believer in the happiness-inspiring powers of capitalism.


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GWPH LOGO

Hi Lou,
I am very “wet behind the ears” when it comes to investing in the stock market, I have a daughter and a son on the way (may name him Lou if this all goes well). I really want to get on the right path for our retirement so we don’t become a burden on them. I was hoping you could look at my portfolio and make any suggestions in what to remove/ add to it for security and of course profitable gains.

GWPH nasdaq 90 @$60.98 usd
GWPH nasdaq 60 @$88.05 usd
RMX tsx 706 @$2.12
TWD tsxv 340 @$3.21
TWD tsxv 677 @$2.94
UEC nyse mkt llc 1000 @$1.92

Thank you very much,

Jeff

P.S Love your segments in the morning and evening and “Happy Capitalism”

 

Hey Jeff,

Thanks for the assignment,your kind words, and listening to Talk Radio AM640 in Toronto. All are very much appreciated. Congratulations on the pending birth of your son! Lou is a great name–let me know when you need me to school the lad on money issues.

Parenthood is a lifelong mission that will demand relentless effort, patience, and the resources to fund your children’s development and your retirement. I will research GW Pharmaceuticals plc (GWPH NASDAQ) first then over the next week I will examine the other stocks that you are holding.

What I can see from the start is that you are taking on some risk which you may have to give further consideration as you refine your personal investor profile and risk tolerance.

GWPH is focused on the development of plant based cannabinoid therapeutics and has commercialized a treatment for MS spasticity they have branded Sativex. The company is managing two phase 3 trials in the United States with partner funding that could open the door to the world’s most lucrative pharmaceutical market. Cannabis is a unique source of over 70 cannabinoid molecules which may lead to new product platforms. THC is the only cannabinoid molecule producing psychoactive effects.

An investigation of the charts will provide you with further particulars regarding this investment.

 

 

 

GWPH

The three- year chart tells the story of explosive growth after the May 2013 initial public offering at $8.90 a share. There are only  19.7 million shares outstanding so if you want to own the stock – you’ll have to pry it out of the owners hands with a mitt full of cash. At this point the stock is building a base near $80.00 which has to be viewed positively.

When a stock takes off like an Atlas Centaur rocket it tends not to build support along the ascent. That can lead to quick and painful declines if investors have not shown a propensity to buy on pullbacks. Another interesting continuation pattern that surfaced in April and May is the stick and pennant which signalled the run to the 52-week high of $111.46  in early July.

 

 

 

 

GWPH2

The MACD and the RSI on the six-month chart have produced a number of buy and sell signals leading to profitable trades. At this juncture the momentum indicators are not providing clarity as to direction. The best case scenario for a new leg up would be a break above $90.00 where some resistance has formed.

The Q4 quarterly report is scheduled for release in November. What you also need to track with biotech companies is their progress through clinical trials and presentations released during the fall conference season. Also keep in mind that GWPH is burning cash as it works to move their cannabinoid molecules from the lab into a marketable product in the United States.

Make it a profitable day and happy capitalism!

 

Categories: Pharmaceuticals
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