Analyst: It's time to buy oil tanker stocks again
It's been a volatile trading day for U.S. stocks, with the major market indexes moving on North Korea denuclearization hopes and rumors of another White House resignation. However, three penny stocks have traded solidly in the black today: biotech Caladrius Biosciences Inc (NASDAQ:CLBS), medical device maker Amedica Corporation (NASDAQ:AMDA), and crude shipping concern Frontline Ltd. (NYSE:FRO).
CLBS Stock Soars on Shire Deal
Caladrius Biosciences stock was last seen 10.3% higher at $5.55, after the company said it bought the exclusive license to Shire's (SHPG) cell therapy program to treat refractory angina. CLBS shares have now roughly doubled since their Nov. 2 record low of $2.63, and are trading in territory not charted in nearly a year, when the drugmaker reported stronger-than-expected earnings.
Quite a few recent CLBS shorts could be shaking in their boots today. Short interest on the stock more than doubled in the most recent reporting period, surging 141.3%.
FDA Nod Lifts AMDA Shares
Amedica stock is up 26.5% to trade at $2.53, after the Food and Drug Administration (FDA) cleared the company's spinal implant device -- "a significant milestone" for the firm, per Chairman and CEO Dr. Sonny Bal. Just last week, AMDA shares were flirting with record lows, bottoming at $2 on Friday. Despite today's jump, though, the security is still down more than 27% for 2018, with recent rebound attempts stalling at its 160-day and 200-day moving averages.
A short squeeze could be propelling the stock's rally. Short interest represents nearly six sessions' worth of pent-up buying demand, at AMDA's average pace of trading.
DNB Markets: It's Time to Buy Again
Frontline shares are up 10.1% to trade at $4.45, after a DNB Markets analysts said that after a steep drop in oil tanker stocks since mid-2016, "we think it's time to buy again." Specifically, the brokerage firm upgraded the industry to "buy" from "hold" for the first time since April 2016, and said investors who are bullish on the market or think the market will turn soon should buy FRO stock, citing high leverage and high upside to asset prices.
FRO has been in a channel of lower highs and lows for the past two years, pressured beneath its 200-day trendline. In fact, the security touched an all-time low of $3.80 on March 1, but is now bumping up against its 10-week moving average -- which hasn't been defeated on a weekly closing basis since early November.
Again, a mass exodus of shorts could help Frontline stock's rebound. Short interest surged more than 35% during the past two reporting periods, and would take nearly two weeks to buy back, at FRO's average pace of trading.
What's more, should the shares extend today's upward momentum, there's plenty of room for more analysts on the bullish bandwagon. Just one of five brokerage firms considers FRO stock a "buy" or better right now.