Shares of CombiMatrix Corp. (CBMX), a genetic testing services company specializing in prenatal and pediatric disorders as well as oncology, skyrocketed as high as 167 percent in earlier trading Thursday to $7.64 to lead all gainers. There was no clear catalyst for the extraordinary move directly from the company, but the stock is trading at abnormally high volume as compared to its daily average.
However, the Orange County Business Journal attributed the jump to an article published on Seeking Alpha earlier this morning, which followed the company’s announcement that it will release its fourth quarter and year-end earnings reports next week on Feb. 27. The Seeking Alpha author, writing anonymously under the pseudonym “Biotech Breakthroughs” and holds a long position in the company, cited preliminary results released by CombiMatrix that indicated a 172-percent increase in prenatal tests, as well as a 25 percent overall increase in billable test volume.
After a 10-to-1 reverse stock split on Dec. 5, 2012, the share price soared about 76.7 percent from $2.41 to $10.35 only 5 days later, after which it tumbled almost all the way back down to $2.86 by Wednesday’s close. CombiMatrix shares have traded in a 52-week range of $1.40 to $17.50 based on the adjusted close price.
“Biotech Breakthroughs” claims that the market has forgotten the impressive guidance the company was showing, and thus investors and traders are not prepared for what he predicts will be an upcoming leap in the stock price.
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