Friday 5 February 2021

With OCGN On The Rise, GOVX Is The Next COVID Vaccine Stock Ready To Soar

On December 22, we issued a bullish report on Ocugen, Inc. (OCGN) called "Why Ocugen Is Set To Soar Again Tomorrow". OCGN closed at $0.81 that day after the company announced that it is teaming up with Bharat Biotech to Co-Develop COVAXIN™, a Whole-Virion Inactivated COVID-19 Vaccine, for the US Market. We believed that OCGN was worth between $500 million to $1 billion in market cap (up to $5 per share) to put it in line with Vaxart, Inc. (VXRT), which is still trading at the upper end of that range despite disappointing COVID vaccine results. OCGN has since surpassed our target on Friday, closing at $5.25 with an after hours move to $8.61. This makes it nearly a 10x return in a month and a half. We believe that GeoVax Labs, Inc. (GOVX) is the next one to make an OCGN-like move. We are up to 947 followers despite not giving out a lot of alerts, a fact that we think is indicative of a successful, diligent and prudent stock picking history. If you like our picks you can follow our blog by clicking the follow button on the top of the left hand panel as well as follow our Small Caps, Big Gains blog where we put up our Canadian picks. You can also follow us on Twitter @StockTradePicks which has over 4,700 followers.

Last month, GOVX was awarded a grant by the NIH to advance its COVID-19 vaccine development. What's important about GOVX's vaccine development is that it's focused on a one shot vaccine that is effective against multiple strains. From the press release:

GeoVax is leveraging its GV-MVA-VLP™ platform to address the global need for an effective and safe SARS-CoV-2 vaccine. Unique among other vaccines under development, the experimental GeoVax candidates are specifically designed to provide a broader and more long-lived level of protective immunity against SARS-CoV-2 while avoiding the potential side effects that can limit vaccine utility and acceptance. GeoVax’s vaccine candidates will be tested for antigen expression and genetic stability under conditions designed to simulate those in manufacturing, which will demonstrate the likely suitability of each vaccine construct as a candidate for full-scale production and clinical testing.

Mark Newman, Ph.D., GeoVax’s Chief Scientific Officer, commented, “The first generation of SARS-CoV-2 vaccines are based on the ‘Spike (S)’ protein and are designed to induce antibodies that block infection of human cells, an effect referred to as virus neutralization. The GV-MVA-VLP platform provides the opportunity to design and test vaccine candidates that differ significantly through the inclusion of multiple SARS-CoV-2 proteins that are presented to the immune system as virus-like particles (VLPs). Our goal is to safely increase vaccine potency and efficacy by inducing both neutralizing antibody and cellular immune responses to optimize the level of protection against existing and potential new variants of COVID as well as establish immunological memory to provide multi-year protection. Vaccines using the GV-MVA-VLP platform developed for other pathogens have proven to be efficacious with a single dose, having strong durability which would be a significant advantage for SARS-CoV-2 global vaccination campaigns.”

While it's still in the early stages, getting a grant not only reduces GOVX's cash burn rate while developing the vaccine, it also shows that it has good enough science to actually get a grant in the first place. 

What also makes GOVX so special compared to other early stage vaccine developers is that its market cap is ridiculously low. As of Friday's close of $5.53, its market cap is only $24 million. This compares very favorably to the other billion dollar companies out there that are also in the early stages of vaccine development. With so many vaccine plays running with or without news, it's only a matter of time before GOVX with its 4.4 million shares outstanding and 2.9 million float goes on its own major run. 

GOVX also has warrants under the symbol GOVXW. These warrants have a strike price of $5.00 and expire in September 2025, so there is plenty of time. They offer leveraged upside because they trade at $1.65. If the stock price doubles to $11, the warrants will be worth $6, or more than triple their current price. We have a mix between stock and warrants. 

Disclosure: We are long GOVX, GOVXW

What's next for microcap stocks? TradeMiner identifies seasonal trends and market cycles, the Penny Stock Prophet and Microcap Millionaires finds the next big small cap plays in various industries while Addicted to Profits makes trades from a Canadian perspective.

There are also some good books available on microcap stocks and day trading such as:

Mastering Microcaps: Strategies, Trends, and Stock Selection (Bloomberg Professional Library)

The Little Black Book of Microcap Investing: Beat the Market with NASDAQ/AMEX Microcap Stocks, OTCBB Penny Stocks, and Pink Sheet Stocks

Microcap Magic: Why The Biggest Returns Are In Stocks You've Never Heard Of

How to Day Trade for a Living: A Beginner’s Guide to Trading Tools and Tactics, Money Management, Discipline and Trading Psychology

How to Day Trade: A Detailed Guide to Day Trading Strategies, Risk Management, and Trader Psychology

A Beginner's Guide to Day Trading Online (2nd edition)

Stock Investing for Beginners: Marijuana Stocks


Here are some other good stock market resources. This includes technical analysis and day trading, dividend stock investing, gold and commodities, sector rotation, options trading and microcap trading strategies:

The dividend stock report from dividendstocksonline.com

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