Updates on AI, ADPT, FTCH, CYRX and CSTL
C3.ai (AI) reported Q4 results yesterday – its first as a public company – that came in ahead of expectations but didn’t offer enough about future growth to support the stock’s valuation. Revenue in the quarter was up 19% to $49.1 million while subscription revenue jumped 23% to $42.7 million. Billings were lower than expected (down 10% versus up 14% growth) due to invoice timing which could be shrugged off if not for this being a newly-public company with high expectations. Big picture this stock will work eventually, but I suspect there could be more downside ahead until the potential of new partnerships comes more clearly into focus. That begs the question if AI is the best place to park capital for a few months or quarters. Given what I see in the market right now I think not. We’ll take the quick hit on our half position and revisit AI when the timing is better. SELL
Adaptive Biotechnologies (ADPT) is a stock we took partial gains on last week (for a 99% return) when it was trading near support, with the intention to sell another quarter at a better price. The underlying reasoning is the long-term story is intact but there may be a quarter or two before things start clicking. Today ADPT has broken below support. We’ll take this as a signal to sell another quarter of our position and hold on to the other half. SELL A QUARTER, HOLD HALF
Farfetch (FTCH) reported last week and the report was OK, but not great enough in the current environment to keep the stock at buy (I moved to hold). Since the report the market has been a little iffy for growth stocks and FTCH has weakened a little more (stock just below 50-day line now). This stock isn’t in trouble right now but also doesn’t seem inclined to head much higher in the near-term. We have a very nice gain of roughly 45% since November and I’m going to take partial profits on it. Sell half. SELL HALF, HOLD REST
Cryoport (CYRX) reported yesterday that Q4 revenue (helped a lot by acquisitions) was up 423% to $48.4 million, beating by $4.4 million, while GAAP EPS came in at -$1.32. Organic revenue growth was up 36%. The company is now supporting 528 clinical trials, compared to 436 at this time last year, and with the acquisitions of MVE and CRYOPDP it has even more exposure to support logistics and distribution of regenerative medicine therapies over the coming years. This is a very volatile stock, and currently CYRX is trading right near support (near 60) and roughly 30% off the high. It’s one of those situations where it’s a toss-up whether the stock goes higher or lower in the near-term. One of the ways we deal with this is to take partial gains to protect our work to date (we are up around 45%) and see how things shake out. Let’s do that now.SELL HALF, HOLD REST
Other Ratings Changes
Castle Biosciences (CSTL)
moves to BUY