We recently started a series called “Penny Stock of the Day”. These ideas are geared towards traders with an extremely high risk appetite.
Our Penny Stock of the Day is chosen by screening for stocks under $5 and then applying technical analysis on the shortlisted set of penny stocks showing unusual volume. When making these trades, please make sure to pay vigilant attention to pricing moves and have a strict stop loss in place to avoid significant losses.
Penny Stock of the Day: Invivyd, Inc. (NASDAQ: IVVD)
Today’s penny stock pick is the commercial-stage biopharmaceutical company, Invivyd, Inc. (NASDAQ: IVVD).
Invivyd, Inc. focuses on the discovery, development, and commercialization of antibody-based solutions for infectious diseases in the United States. The company developed INVYMAB, a platform that combines viral surveillance and predictive modeling with advanced antibody engineering.
Its pipeline includes PEMGRADA (pemivibart) injection, a half-life extended investigational monoclonal antibody (mAb) for the prevention of COVID-19 in adults and adolescents; VYD2311, an mAb candidate which is in preclinical studies for the prevention or treatment for COVID-19; and adintrvimab, that is in phase 3 clinical trials for the prevention or treatment of COVID-19.
The company also has discovery stage candidates for the prevention of seasonal influenza and COVID-19. It has a collaboration agreement with Adimab, LLC for the discovery and optimization of proprietary antibodies; and the Scripps Research Institute to perform research activities to identify vaccine candidates for the prevention, diagnosis, or treatment of influenza or beta coronaviruses. The company was formerly known as Adagio Therapeutics, Inc. and changed its name to Invivyd, Inc. in September 2022.
Website: https://invivyd.com/
Latest 10-k report: https://investors.invivyd.com/static-files/c0894be7-cf7d-4ec2-aa22-eb7a891dc4c7
Analyst Consensus: As per TipRanks Analytics, based on 2 Wall Street analysts offering 12-month price targets for IVVD in the last 3 months, the stock has an average price target of $6.78, which is nearly 540% upside from current levels.
Analysts | Source: TipRanks.com
Potential Catalysts / Reasons for the Hype:
- The company reported encouraging data from COVID-19 antibody trial. VYD2311 showed a 17-fold higher potency than pemivibart in in-vitro tests, with sustained high serum concentrations at Day 65. This means that VYD2311 could offer strong and long-lasting protection against COVID-19. A single dose may provide high protective antibody levels for six months to a year or longer.
- For Q4 2024, the net product revenue for PEMGARDA surged 48% quarter-over-quarter to $13.8 million while operating expenses fell 55% to $32 million.
On analyzing the company’s stock charts, there seem to be multiple bullish indications…
Bullish Indications
#1 Falling Wedge Pattern Breakout: The daily chart shows that the stock has been forming a falling wedge pattern for the past several months. These are marked as purple color lines. It has typically taken support at the bottom of the wedge before bouncing back. The stock has currently broken out from the falling wedge pattern. Once the stock breaks out of the falling wedge pattern, it could move higher.
IVVD – Daily Chart
#2 Bullish ADX and DI: The ADX indicator shows bullishness as the +DI line is above the -DI line, and the ADX line is currently moving higher from below the +DI and -DI lines.
#3 Price above MA: The stock is currently above its 50-day SMA, indicating that the bulls have currently gained control.
#4 MACD above Signal Line: In the daily chart, the MACD (light blue color) is currently above the MACD signal line (orange color). This indicates a possible bullish setup.
#5 Above Support Area: The weekly chart shows that the stock is currently trading above a support area, which is marked as a pink color dotted line. This looks like a good area for the stock to move higher.
IVVD – Weekly Chart
#6 Bullish Stoch: The %K line is above the %D line of the stochastic in the weekly chart, indicating possible bullishness.
Recommended Trade (based on the charts)
Buy Levels: If you want to get in on this trade, the ideal buy level for IVVD is above the price of $1.10.
Target Prices: Our first target is $2.50. If it closes above that level, the second target price is $3.50.
Stop Loss: To limit risk, place a stop loss at $0.35. Note that the stop loss is on a closing basis.
Our target potential upside is 127% to 218%.
For a risk of $0.75, our first target reward is $1.40, and the second target reward is $2.40. This is a nearly 1:2 and 1:3 risk-reward trade.
In other words, this trade offers 2x to 3x more potential upside than downside.
Potential Risks / Red Flags:
- The company has a history of net losses. IVVD’s net losses were $198.6 million and $241.3 million, for the years ended December 31, 2023, and 2022, respectively. As of December 31, 2023, the company had an accumulated deficit of $732.1 million.
IVVD – Consolidated Statements of Operations
- Hedge Funds Decreased Holdings by 53.6K Shares Last Quarter.
Hedge Funds | Source: TipRanks.com
- The company has ongoing legal proceedings. On January 31, 2023, a securities class action lawsuit captioned Brill v. Invivyd, Inc., et. al., Case No. 1:23-CV-10254 LTS, was filed against the Company and certain of its former officers in the U.S. District Court for the District of Massachusetts. The complaint alleges violations of Sections 10(b) and 20(a) of the Exchange Act and Rule 10b-5 promulgated thereunder on the basis of purportedly materially false and misleading statements and omissions concerning ADG20’s effectiveness against the Omicron variant of COVID-19.
- Corporate Insiders placed Informative Sells of Shares Worth $235.2K in the Last 3 Months.
Insiders | Source: TipRanks.com
- The company has a limited operating history and no history of commercializing products, which may make it difficult for an investor to evaluate the success of the company’s business to date and to assess its future viability.
- Despite being a loss-making company, the executives are being paid significant compensation.
IVVD – Executive Compensation
As you can see, today’s featured penny stock offers big upside potential… but it also comes with a number of risks and red flags. As always, when dealing with penny stocks, we advise caution before entering into such high-risk ventures. Remember to think before you trade… understand the risks… and if you decide to trade, stick to your stop-losses!
Happy Trading!
Trades of the Day Research Team
READ BEFORE TRADING PENNY STOCKS: The allure of penny stocks lies in their potential to deliver massive gains in a short period of time. However, in exchange for that opportunity, most penny stocks carry tremendous risk. They can be extremely volatile and are susceptible to “pump and dump” schemes and fraud.
Unlike regular stocks, the financial condition of most penny stock companies can be extremely difficult to analyze, as the majority of such stocks are traded on over-the-counter (OTC) exchanges, which are typically less transparent and less regulated than the major exchanges. In fact, in the penny stock space, it’s often easier to spot warning signs and red flags than it is to identify a sound investment. Nevertheless, we do our best to identify short-term trade opportunities in this exciting space because we know some of our readers are looking for high-risk, high-reward ideas. We just urge you to make sure you fully understand the risks before making any of these trades.
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