Shares in small-cap biopharmaceutical Novavax (NVAX) opened even on Monday, but quickly started losing value. Sparking the sell-off appears to be the sale of 3 million shares by private company Cadila Pharmaceuticals. Netting $14.85 million with an average share price of $4.95, Cadila’s sale appears to be another blow to Novavax in an already trying month.
As a 10 percent owner, Cadila Pharmaceuticals was forced to file an SEC form-4 to disclose its sale, and it appears that this news sent Novavax shares into the tank for a more-than 9.5 percent loss. Shares opened at $4.68, even with Friday’s close, but the selling began at a steady clip and didn’t slow as shares fell as far as $3.94 apiece just after 11 a.m.
The stock rebounded off of that low, but remained down almost 10 percent on the day.
Novavax has seriously struggled in March, dropping over 30 percent over the course of the month. The stock had previously been trading in an upward wedge pattern, but, since breaking through support in early March, has been in freefall, crossing its 20-day and 50-day SMA from above. Today’s losses have it trading dangerously close to its 200-day SMA.
Despite the losses, Novavax has still nearly doubled over the last year, potentially indicating some of the reason for the sharp decline. Technical factors would seem to indicate that the stock was overbought at the start of March, with its 14-day RSI briefly touching 70 and its 14-day stochastic RSI hitting 1.0 at about the same time.
Novavax is developing novel vaccine technologies built on recombinant nanoparticles for use in preventing viral, bacterial, and parasitic diseases.
“Unlike traditional vaccines that are based on killed viruses or live, attenuated viruses, Novavax uses recombinant technology that allows us to customize the components of our vaccine candidates in order to solve challenges presented by novel infectious diseases,” reads the company’s website.
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