Background Profile:

GW Pharmaceuticals Plc is a biopharmaceutical company working on discovery, development, and commercialization of therapeutics powered by medical cannabinoid products including cannabidiol-based (CBD) medicine known as Epidiolex and THC based medicine in Europe and Canada for a broad range of diseases treating Dravet syndrome and Lennox-Gastaut syndrome known as rare forms of childhood epilepsy. $GWPH exists in the Health Care/Life Sciences Industry operating oversees in the United Kingdom under Geoffrey William Guy as Executive Chairman and Scott M. Giacobello as Chief Financial Officer.

 

Competitor News Impacting Performance:

  • GW Pharmaceuticals PLC ADR $GWPH (U.S.: Nasdaq) GWPH: (%) reportingGWPH will report FY 2017 earnings on 12/05/2017 rpeorep Q4 earnings on December 4th, 2017 dropped over 10% since Friday following an announcement of its competitor Zogenix.
  • ($ZGNX) reporting positive results of its epilepsy drug ZX008 for Dravet Syndrome sending shares skyrocketing over 170% following the release of positive Phase 3 data with an expanded survey size than previously used rivaling the results of $GWPH studies with Epidiloex to reduce seizures.
  • Zogenix plans to submit an application for low-dose fenfluramine to the FDA in late 2018 to combat $GWPH Epidiloex drug which is also seeking approval by the FDA. 

Drug Test News

  •  Recent studies have shown that $GWPH CBD based drug called Epidiolex has reduced monthly seizures up to 40% in phase 3 testing targeting epilepsy in children/young adults which had outperformed any competitor before $ZGNX.
  •  The competitor Zogenix $ZGNX drug ZX008 which had recently reported on September reduced rates of monthly seizures by 72.4% which combines small doses of Fenfluramine (i.e., famous serotine releasing drug in the 90s for weight loss before being shut down by FDA) to combat epilepsy in an unorthodox manner.
  • $ZGNX news has begun to cut into the profit margins of $GWPH which also produces other drugs including Sativex (nabiximols) providing treatment of spasticity due to Multiple Sclerosis (MS) in 29 states
  •  $GWPH produces other drugs such as GWP42002:GWP42003 researching/identifying phytocannabinoid compounds including multiple variety of cannabinoid combinations such as CBD:THC combination to treat glioblastoma multiforme, or GBM, a particularly aggressive brain tumor, and 3. GWP42003 known to treat schizophrenia using CBD currently in Phase 2a of research.
  • GW Pharma’s drug Epidiolex (Cannabidiol) presented in March 2016 is currently in Phase 3 trial, producing  a monthly median seizure reduction of 39% compared with a 13% reduction in patients treated with a placebo.
  • GW Pharmaceuticals remains the first pioneer drugmaker to scientifically prove in clinical studies that its use can significantly lower the monthly frequency of seizures in Dravet syndrome patients now along with $ZGNX.

 

Major Competitors:

$ZGNX

finviz dynamic chart for  ZGNX

 

$NVS

finviz dynamic chart for  NVS

 

 

$INSY.

finviz dynamic chart for  INSY

 

 

Fundamentals:

  • $GWPH has a moderate to high 2.7 beta rating (i.e., measure of the volatility in market) showing that it has added risk compared to the market.
  • $2.76 billion market cap 
  • $25.2 million shares outstanding
  • $25.09 million public float with 3.81 million shares short.
  • Price to Book ratio: 5.88  
  • Current Ratio: 10.40 
  • Debt-to-Equity Ratio: 0.02%
  • Annual Revenue: $10.25 million

Ownership: (Source: WSJ)

Analyst Ratings: (Source: CapitalCube)

 

1.    Research Team: REDUCE RATING (Updated: 10/01/2017)

2.    The Street: SELL RATING (Updated 09/30/2017)

3.    Market Edge: AVOID RATING (Updated: 09/28/2017)

4.    Leerink Swann: MAINTAINS OUTPERFORM PT $153 (Updated: 10/02/17)

 

ETFS with exposure to GW Pharmaceuticals Plc Source: (Capital Cube)

 

Technical Analysis:

finviz dynamic chart for  GWPH

 

The 1 year daily chart (i.e., each candlestick represents 1 day of price action) shows that the long-term price trend is shaping into a downward wedge pattern tracing down from the highs of last March at $130 to test the $115 area after $120 was rejected in August. The bottom line of the wedge traces from the low in June in the $115 price range rising up slightly towards the $100 support range. The current dip in the last few days of the stock show price has rejected moving high above the $100 short term resistance area which has become a key area the stock needs to hold above to retest $115 towards retesting its prior high of $120 in August, and reversing away from its current downtrend resulting in a 25% drop within 1 year.

 The 20 day simple moving average has crossed up above the 50 day moving average which provides a bullish crossover providing rationale for a short term spike in price if the stock can close higher this week above the 200 day simple moving in the $112.5-$113 price range area to reconfirm the uptrend rather than a failed bounce that leads to more downside.

Entry Range: $97.50-$99

      Target 1: $106       

Target 2: $110

Long Term 3rd Target: $118

Stop: $95

 


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