Champions Oncology Inc (OTCMKTS:CSBR) With A Slow But Steady Ascend
Champions Oncology Inc (OTCMKTS:CSBR) is a biotech penny stock. As the name would suggest, they’re dealing with the treatment of cancer and, having seen numerous small cap ventures working in this particular sector fail catastrophically, we are generally a bit more reserved. CSBR, however, seems different than the bulk of oncology-oriented enterprises. Instead of trying to come up with a magic pill that could solve the problems for millions of people suffering from the cruel disease, they have adopted a different strategy. A rather clever one at that.
Basically, when a person is diagnosed with cancer, CSBR take a sample from the tumor, implant it into lab mice, wait for it to grow and then try treating it with different medicines to see which combination is the most effective. This, on the one hand, helps individual patients by providing them with a personalized solution that should work, but on the other, it also aids the medical corporations who are in a race against time to complete the development of their own treatments.
It really is a clever business plan and they have been following it for quite some time. Yet, the stock chart for the last three years suggests that investors haven’t been paying much attention. Until about three months ago, the ticker was happily residing in the $0.50 – $0.60 range, trading volumes were dismal and the percentage movement on the whole was pretty humdrum. In mid-June, however, the interest started to grow and soon after, the price followed suit. It all culminated on Friday, when the newly issued 10-Q covering the period ended July 31 brought the next in a long line of 52-week highs. The question now is: “Has CSBR run too high for its own good?”.
Well, as we mentioned, the company has been following its business plan for a while now and, unlike other biotech penny stocks that have been occupying a host of different industries throughout the years, the people at CSBR have been solely focused on the cancer research. The latest report shows that their persistence has, to some extent, paid off. Here’s a recap of the most important figures:
- cash:$7.3 million
- current assets: $9.4 million
- current liabilities: $2.1 million
- quarterly revenue: $3 million
- quarterly net loss: $2.2 million
The rather substantial net loss is primarily due to stock-based compensation and the Translational Oncology Solutions segment of their operations actually ended the quarter with a profit. In addition to this, you can see that they have around $7.2 million in working capital which is quite a lot for a small cap venture. All in all, while they’re not there yet, CSBR seem to have a rather solid foundation which could eventually lead them to success. But is there anything that might hamper their progress?
Well, it would appear that increased interest in the ticker was sparked primarily by an increase in the PR activity. No less than eight new headlines have hit CSBR‘s Yahoo! Finance profile since the beginning of September, for example, and we all know that too much hype around a small cap venture usually leads to some pretty erratic ticker behavior. The chart for Nuvilex Inc (OTCMKTS:NVLX) is quite illustrative of what we mean. The presence of outfits like OTCBBJournal, who are usually involved in advertising small cap ventures in exchange for money is also a cause for concern and there’s an upcoming event that will certainly affect the price. Whether it will be for the better or worse, however, remains to be seen.
We’re talking about the planned stock split. CSBR announced recently that in an attempt to uplist the ticker to one of the national exchanges, they want to effect a split with a ratio ranging from one-for-three to one-for-ten. This will increase the share price, but it can’t guarantee the listing on NASDAQ or NYSE and if the ticker remains on the OTC Bulletin Board, the results could be quite depressing.
That’s why, while there are signs of long-term potential, CSBR still carries its risks and it’s absolutely vital that you consider them carefully before making any quick decisions.
