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A look at GDP, Acadia, Microsoft

Michael Kramer and the Clients of Mott Capital own shares of ACAD

What a boring day, with the S&P 500 finishing the day only up by 11bps. The index stalled out right at 2,672 and just held there all day long. It was a solid end to the week, and I think the market will continue to rise over the near-term.

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Yields

10-year yield backed are back down to 2.96 percent, after that 2.3 percent GDP growth rate for the first quarter that was less than stellar in my opinion, and way below where I would like to see it. But then again, it is all from the point of view one uses.

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GDP

Even looking at data from GDP can be tricky, because remember the latest reading we got this morning is the seasonally adjusted annual rate. I like to look at GDP on a quarterly basis seasonally adjusted just on y/y metric, and that shows a different picture. That shows us that GDP on a y/y basis grew by 2.9 percent and that the improvement in GDP growth has been steady and linear.

It would be nice if GDP growth could continue in a such a linear path over the next several quarters, we could even be heading towards a 4 percent handle. Crazy I know.

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Predictions Update Now 1 For 5

So I decided to go back and revise my 0 for 5 call on my earnings predictions, after a day of trading is complete, and changing my record to 1 for 5. Microsoft, actually played out just as I had written.

“The options market and analysts price target are both overwhelming bullish, and with such a big jump in revenue during the quarter, it may not be too hard for the company to top earnings estimates. The real test will come should shares be able to breakout technically and rise above $97. Be mindful of a gap higher following results, only for that gap to be refilled.”

I think the chart is self-explanatory. Yes! 1 for 5 :).

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Charts used with the permission of Bloomberg Finance L.P. This report contains independent commentary to be used for informational and educational purposes only. Michael Kramer is a member and investment adviser representative with Mott Capital Management. Mr. Kramer is not affiliated with this company and does not serve on the board of any related company that issued this stock. All opinions and analyses presented by Michael Kramer in this analysis or market report are solely Michael Kramer’s views. Readers should not treat any opinion, viewpoint, or prediction expressed by Michael Kramer as a specific solicitation or recommendation to buy or sell a particular security or follow a particular strategy. Michael Kramer’s analyses are based upon information and independent research that he considers reliable, but neither Michael Kramer nor Mott Capital Management guarantees its completeness or accuracy, and it should not be relied upon as such. Michael Kramer is not under any obligation to update or correct any information presented in his analyses. Mr. Kramer’s statements, guidance, and opinions are subject to change without notice. Past performance is not indicative of future results. Neither Michael Kramer nor Mott Capital Management guarantees any specific outcome or profit. You should be aware of the real risk of loss in following any strategy or investment commentary presented in this analysis. Strategies or investments discussed may fluctuate in price or value. Investments or strategies mentioned in this analysis may not be suitable for you. This material does not consider your particular investment objectives, financial situation, or needs and is not intended as a recommendation appropriate for you. You must make an independent decision regarding investments or strategies in this analysis. Upon request, the advisor will provide a list of all recommendations made during the past twelve months. Before acting on information in this analysis, you should consider whether it is suitable for your circumstances and strongly consider seeking advice from your own financial or investment adviser to determine the suitability of any investment.

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Acadia

Did you see that Acadia news today, I sure did.

The stock is still struggling to recover from CNN doubling down on its Sell rating on the stock. The two analysts should probably get a better handle on the database and how it actually works.

If you haven’t seen the actual testimony the article referred to and the “grilling”; it is below for you to watch. It starts at the 1-hour mark. When I first found the video and posted it, there were only 45 views; it has grown quite a bit since.

Then there was this commentary from Acadia:

There was no increase in mortality detected in users of NUPLAZID.

6 of the 88 patients treated with NUPLAZID died (compared to 5 out of 14 in the group that never started NUPLAZID).

The way I read that phrase, 35 percent of the patients that didn’t take Nuplazid died, to the only 8 percent that died when on Nuplazid. Perhaps, Nuplazid helped to lengthen their lives? Maybe. The mortality rate once Parkison’s progress to the psychosis stage is high.

It would be even more helpful if Acadia ran more study focusing on the data set above to find out if that benefit really does exist.

Then there was this part:

Approximately 93 percent of the reported adverse events associated with NUPLAZID are considered “solicited” due to this direct interaction with patients and caregivers, while only approximately 7 percent of these events are considered “spontaneous” reports, which are voluntary reports originating from consumers or healthcare professionals. In contrast, most other antipsychotics are distributed through retail channels, which rely almost entirely on “spontaneous” reporting. Consequently, only a small fraction of actual adverse events are collected for these drugs.

But still the damage is done, and hopefully, in time, the stock shall recover.

I’m done.

-Mike

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Mott Capital Management, LLC is a registered investment adviser. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed herein. Upon request, the advisor will provide a list of all recommendations made during the past twelve months. Past performance is not indicative of future.

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Charts used with the permission of Bloomberg Finance L.P. This report contains independent commentary to be used for informational and educational purposes only. Michael Kramer is a member and investment adviser representative with Mott Capital Management. Mr. Kramer is not affiliated with this company and does not serve on the board of any related company that issued this stock. All opinions and analyses presented by Michael Kramer in this analysis or market report are solely Michael Kramer’s views. Readers should not treat any opinion, viewpoint, or prediction expressed by Michael Kramer as a specific solicitation or recommendation to buy or sell a particular security or follow a particular strategy. Michael Kramer’s analyses are based upon information and independent research that he considers reliable, but neither Michael Kramer nor Mott Capital Management guarantees its completeness or accuracy, and it should not be relied upon as such. Michael Kramer is not under any obligation to update or correct any information presented in his analyses. Mr. Kramer’s statements, guidance, and opinions are subject to change without notice. Past performance is not indicative of future results. Neither Michael Kramer nor Mott Capital Management guarantees any specific outcome or profit. You should be aware of the real risk of loss in following any strategy or investment commentary presented in this analysis. Strategies or investments discussed may fluctuate in price or value. Investments or strategies mentioned in this analysis may not be suitable for you. This material does not consider your particular investment objectives, financial situation, or needs and is not intended as a recommendation appropriate for you. You must make an independent decision regarding investments or strategies in this analysis. Upon request, the advisor will provide a list of all recommendations made during the past twelve months. Before acting on information in this analysis, you should consider whether it is suitable for your circumstances and strongly consider seeking advice from your own financial or investment adviser to determine the suitability of any investment.