Cytomedix Has Traders Reaching For The Dramimine (CMXI)

After gapping higher eight days ago on news that Medicare would cover its Autolougous PRP Gel in the treatment of chronic wounds, shares of Cytomedix (OTC: CMXI) gave back all the gains from last week and then some. The reason for the selling pressure today appears to lie in how traders interpreted the company’s second quarter financial results released late yesterday afternoon. Some highlights in the quarterly report included:

  • Revenues increased $3.69 million from $1.39 million.
  • Sales increased to $1.81 million from $1.39 million.
  • Additional revenues of $1.82 million came from licensing agreements.
  • Net loss to common shareholders equaled $7.46 million, or $0.09 per share.
  • The company also announced the early termination in the exclusivity period for 20 pharmaceutical companies. The cancelation frees Cytomedix to engage other interested parties.

The news sent sellers scurrying for the exits as the stock posted a loss on the day of 34 cents, or almost 23%, from the yesterday’s closing price. The stock gapped down 9 cents at the opening and showed no signs of recuperating for the rest of the day. Shares finished the first half-hour of trading down another 14 cents at $1.20. Sellers mellowed a bit until the last hour of trading when they pushed the stock to its session low at $1.10 before a closing print of $1.14. The high on the day came on the opening trade at $1.34. The 500,000 shares exchanging hands today easily outpaced the 104,000 shares traded on an average day.

Traders in Cytomedix over the last nine days must feel they are on a ride that takes a thrill seeker up hundreds of feet in the air and then hurls them back to earth in a matter of seconds. When news of the Medicare coverage broke last week, the stock soared on August 6, 2012, by almost 30% to close above $1.70. Shares retreated a bit afterwards, but rallied yesterday, perhaps in anticipation of the financial report. The exuberance displayed by traders just eight days ago quickly faded yesterday afternoon. Besides reaching for the Dramamine, traders will be wondering what other surprises await them.

The stock hit its annual high toward the end of May when shares traded for $2.32. Prior to the high on the year, the stock had steadily climbed from its 52-week low set almost a year ago when share sold for $0.29.

Stock promoters were strangely quiet about the earnings news from Cytomedix. They bustled with activity over the Medicare announcement, but had nothing to say about the action today. A total of three promotions can be found on Stockpromoters.com. On Twitter, however, there was no shortage of chatter from the likes of @QSTwits and @StockNewsNow, plus others.

The Gaithersburg, Maryland, company focuses on treatments that capture the body’s natural healing process through regenerative therapies for chronic wounds. The primary development for Ctyomedix involves its rich plasma platform technology, where a patient’s own cells are used to treat the wound. The company was founded in 1998.

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Published by Alan Masterson

Alan has over 25 years of trading experience in the U.S. equity markets. He began his career in finance working on a program trading desk specializing in over-the-counter stocks. His career progressed from that point to his current position as senior trader on an institutional trading desk. In the evenings, Alan teaches economics at a local community college. He has contributed articles to various publications over the last six years, including feature articles for an economics magazine and various financial blogs. You may contact Alan via his email (alanmasterson@wallstreetpr.com) or his Google+ page (https://plus.google.com/103338576216002376250).

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