The share price of Emerging Biosolutions, a specialized biopharmaceutical company, has fallen by 15% over the last twenty-one trading days, while it is down 42% since the start of the year. The EBS stockpile has had a rough year so far, with its manufacturing facility in Baltimore facing heat after a batch of Johnson & Johnson Covid-19 vaccine was contaminated. The US FDA inspected the manufacturing facility and made nine observations. It was April and the company went out of its way to address all concerns. Towards the end of July, the US FDA approved the reopening of the Baltimore plant and since then the regulator has cleared several lots of Johnson & Johnson’s Covid-19 vaccine from that facility. Emergent also recently signed an agreement with Canada-based Providence Therapeutics to manufacture its mRNA-based Covid-19 vaccine candidate.
While the reopening of the factory is good news for Emergent, the company’s woes are far from over. The company also faces a lawsuit for alleged violations of securities laws. The claimant alleged that the company did not disclose to investors issues at its Baltimore plant that would affect its ability to manufacture the vaccine. Additionally, there are allegations that senior executives at the company have sold more than $ 20 million in stock with prior information about manufacturing issues at its Baltimore plant, but the information has not been released. made public. Investors are now worried that the company will end up paying a hefty penalty, which would prevent the stock from recovering.
But now that EBS stock has seen a 15% drop in the past month, will it continue on its downward trajectory or is a rise imminent? Based solely on historical performance, there is a high probability of a rise in the EBS share over the next month. Out of 165 cases in the last ten years where EBS stock has gone down 15% or more over twenty-one days, 112 of these have caused EBS stock to rise during the period of a following month (twenty-one trading days). This historic trend reflects 112 out of 165, or approximately 68% chance of a rise in EBS stock over the next month. See our analysis on Risk of an increase in emerging biosolution stocks for more details.
Calculation of “probability of event” and “chance of increase” using data from the last ten years
- After changing -6% or more over a five-day period, the stock increased over the next five days 48% of the time.
- After fluctuating -10% or more over a ten day period, the stock rose over the next ten days in 51% of cases
- After changing -15% or more over a twenty-one day period, the stock rose over the next twenty-one days in 68% of cases.
Predict the average return of Emerging Biosolutions stock return: AI predicts the average and excess return of EBS after a fall or rise
Comparison of Emerging Biosolutions’ (recent) stock returns with peers
- Five-day return: highest ENDP at 6.4%; Lowest EBS at -5.8%
- Ten-day return: highest ENDP at 43%; Lowest EBS at -10%
- Twenty-one day return: highest ENDP at 12%; Lowest EBS at -15%
While EBS stocks may see higher levels, 2020 has created a lot of price discontinuities that may provide some interesting trading opportunities. For example, you’ll be surprised how counterintuitive stock valuation is to Merck vs Emerging Biosolutions. Also, Performance of Emerging Biosolutions shares summarizes the performance of EBS shares and the chances of its rise or fall, among other important metrics.
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