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Selective movement versus the herd mentality of Q1

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For the 99 Canadian healthcare companies starting 2015 with share prices of $0.10 or higher, the decliners outnumbered advancers by 56 to 43 and the average share price change was -4.1% in Q2 2015. There were 6 companies with share price increases of 40% or more, whereas 9 companies had share price declines of 40% or more.

The sector is not only impacted by the performance of individual healthcare companies. While the TSX Composite Index had a strong start to Q2, it had lost all the 2015 gains by the end of the quarter. The TSX Venture Composite Index bounced along a bottom established in late 2014. In the U.S., strong performance by technology stocks moved the NASDAQ higher and the NASDAQ Biotechnology Index was carried higher by sales and acquisitions (both announced and rumoured).

In this blog, I am going to comment on the Q2 and H1 performance of the group of 47 companies with share prices of $1.00 or more to start 2015.

Q2 2015 Performance

  •  Decliners outnumbered advancers by 27 to 20
  •  Average and median share price changes were -7% and -6%, respectively
  •  The only groups with positive average share price changes were the Services and Therapeutics-Commercial groups
  •  Only 4 companies had share price changes of 40% or more in Q2 versus 9 companies in Q1
  •  Only one company had a share price increase of 40% or more
    •  Nuvo Research (+43%) – bouncing from a WF10 clinical failure in Q1, the Q2 movement appeared to be a result of improved financial results
  •  Three companies had a share price decline of more than 40%
    •  Aurora Spine (-50%) – continuation of an almost 18-month slide
    •  GeneNews (-51%) – financial and cash concerns may have contributed to increased trading volume in mid-April
    •  Transition Therapeutics (-70%) – a Phase 2 trial of ELND005 in Alzheimer’s patients did not meet its primary clinical endpoint

 

 Q2 2015 Overview of Tier 1 Companies in the Canadian healthcare industry

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 Q2 2015 Overview of Tier 1 Company Share Price Performance (Avg. Change %)

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H1 2015 Performance

The investor focus in H1 has been companies with revenues, profits and dividends/distributions. The three groups with the highest average share price gains were Services, Therapeutics – Commercial and Medical Devices. Most of the share price gains in these groups, especially the +40% movers, occurred in Q1. The best first-half performance in this group was by Trillium Therapeutics (+161%) but ESSA Pharma, which started trading on January 27th, had a 329% share price increase relative to the pricing of its last financing as a private company (US$2.75 or C$3.29).

  •  Advancers outnumbered decliners by 25 to 22
  •  Average and median share price increases were +7% and +2%, respectively
  •  Seven companies had share price increases of 40% or more and five companies had share price decreases of 40% or more in Q2.

 

Q2 H1 2015 Overview of Tier 1 Companies in the Canadian healthcare industry

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 Q2 H1 2015 Overview of Tier 1 Company Share Price Performance (Avg. Change %)

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[The author and his immediate family members may have long or short positions in the shares of some companies mentioned in or assessed during the preparation of this blog. Past share price performance may not be an indicator of future share price performance. This blog does not consider the investment objectives, financial situation or particular needs of any particular person. Investors should obtain professional advice based on their own individual circumstances before making an investment decision.]

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