Imugene [ASX:IMU] Shares Rise as Management Seeks to Reassure Shareholders

By ,

Australian immune-oncology stock Imugene [ASX:IMU] released a letter this morning addressing shareholder discontent at the recent share price decline.

In late afternoon trade on Monday, IMU shares were up 10%.

The shareholder letter comes after Imugene shed 45% in the last 12 months.

Will management’s optimism about Imugene’s prospects assuage investor concerns?

ASX:IMU stock prices

Source: Tradingview.com

IMU’s letter to shareholders

In a joint statement, Imugene CEO Leslie Chong, and executive chairman Paul Hopper, addressed shareholders about Imugene’s recent share price performance.

In a nutshell, the executives think Imugene is still well-placed, with a ‘rich pipeline and prospects’.

Imugene endeavoured to assure shareholders, claiming it’s ‘as strong as it has ever been in its history’.

Despite this strength, Imugene’s management admitted it was sailing through turbulent seas.

In fact, Imugene reeled off some statistics, showing that since December 2021, biotech shares have ‘fallen dramatically’.

Citing figures from Bloomberg, Imugene reported that ‘April was the worst month on record for US biotechs since at least 1997’.

The biotech sector fell 65% from a peak registered in February 2021.

Despite the souring sentiment for the sector, Imugene remains upbeat.

Why?

In its own words, Imunege management noted:

In reality, things have only improved from our share price peak last year. Allow us to remind you about the company you are a shareholder in. Imugene is as strong as it has ever been as we continue to make good progress.

  • We have $100 million in cash making us one of the most financially secure biotechs on the ASX
  • We have 3 unique platform technologies supporting 6 unique assets – onCARlytics, CHECKvacc; PD1-Vaxx; CF33 (VAXINIA) & HER-Vaxx
  • Within 12 months we expect to have ~10 clinical studies supported by 5-6 FDA IND’s
  • Our drugs are targeting more than 10 disease areas
  • We have 2 supply agreements with leading pharmaceutical companies
  • We have 2 industry/scientific collaborations

Imugene also addressed the recent cancellation of a supply agreement with Merch & Co.

Imugene labelled the reaction to the cancellation as a ‘storm in a teacup’:

Three novel technology platforms

Source: Imugene

Imugene share price outlook and seeking bargains in today’s market

In its most recent half-yearly results, Imugene reported a net loss of $14.8 million, up from $6 million in the prior corresponding half.

Proceeds from issuing new shares during the half propped up Imugene’s cash holdings, with the biotech stock ending the period with $118.4 million in cash and cash equivalents.

Today’s jittery climate spooked by inflation and rising rates doesn’t help sectors like the biotech industry, whose stocks often operate without revenues for years.

Rising rates make distant profits in research companies less appealing.

But that’s not to say that rising rates affect all stocks equally.

The current climate offers opportunities for the savvy investor willing to zag while others zig.

But how best to identify the opportunities?

Our expert, Callum Newman, recently released a report on ‘left-for-dead’ stocks that could rebound in a big way.

You can find out more about Callum’s three ‘grave-dancer’ stocks here.

Regards,

Kiryll Prakapenka,
For Money Morning

 

About Kiryll Prakapenka

Kiryll Prakapenka is a research analyst focusing on investigating the biggest trends in investments. Kiryll brings sound analytical skills to his work, courtesy of his Philosophy degree from the University of Melbourne. A student of legendary investors and their strategies, Kiryll likes to synthesise macroeconomic narratives with a keen understanding…

[WATCH] Closing Bell — Cooking with Gas

In today’s Money Weekend…electricity prices have been marching higher for months…gas markets melted down completely…a bunch of gas stocks that I reckon could benefit from the crisis…and more…

[WATCH] Closing Bell — Markets Take a Breather

In today’s Money Weekend…markets attempt to rally…economy slowing rapidly as liquidity dries up…New York state business conditions…and more…

Appen Shares Spike on $1.2 Billion Bid

Artificial intelligence services business Appen [ASX:APX] saw its shares spike 30% before entering a trading halt on news of a takeover bid from TELUS International.

TechnologyOne [ASX:TNE] Shares Flat Despite Record H1 FY22 Profit

Enterprise SaaS stock TechnologyOne [ASX:TNE] has released its half-year results, notching its 13th year of ‘record first half profit’.

[WATCH] Closing Bell — The Bear Wakes Up

In today’s Money Weekend…US equities have reached a crossroads…perhaps a balancing-up period is coming…gold has bounced as a result of US dollar weakness…and more…

Plenti Shares Lift 2.5% As It Unveils Full-Year Results

Fintech lender Plenti Group [ASX:PLT] is enjoying a brief reprieve today. The stock is up 2.47% at time of writing, clawing its way back from strong downward momentum in recent months.