Borislav Tonev

OncoSec Medical Inc (OTCMKTS:ONCS) Shows Some Signs Of Hesitation Once Again

by Borislav Tonev September 11, 2013
03ONCS.pngA couple of months ago OncoSec Medical Inc (OTCMKTS:ONCS, ONCS message board) was hovering pretty comfortably around $0.24. Trading volumes were low and the lack of any significant price movement suggested that the stock is all but forgotten. Then, on July 10, everything changed.

The ticker woke up and surged in the right direction reaching $0.30 per share in a matter of less than ten days. Then it showed some signs of hesitation, dropped back down to $0.27 and the same roller-coaster-like movement was repeated several more times throughout the last month and a half. While there are quite a lot of corrections, the overall direction is North and on Monday, ONCS reached an intraday high of $0.359. Yesterday, however, it cracked under the pressure once again and dropped back to around $0.32. We're pretty sure that the shareholders are willing to see a more consistent movement towards the higher end of the charts and so, we decided to see if there is anything to support such growth.

It's fair to say that the workers at the PR department haven't put in extra hours over the last weeks. On July 22 they announced that the management team have presented some positive results from their Phase II trials at the 8th World Congress of Melanoma which is definitely a sign that they're moving in the right direction. Unfortunately, we have yet to learn what the next steps will be and when they expect to have the whole thing ready. Since then, they informed us that the company CEO, Mr. Punit Dhillon, has presented ONCS at an investor conference on Monday, and that just about sums up the news coming in the form of press releases. Yet, there are quite a bit more headlines to be found at ONCS' Yahoo! Finance profile.

Most of them lead to Seeking Alpha (SA) articles and if you are a frequent visitor of our website, you'll know that these coverages often affect the chart movement in a negative way. Nuvilex Inc (OTCMKTS:NVLX), for example, was recently featured in an SA coverage which was intended to reveal some truths about the overly promoted stock and the results were quite dismal - six consecutive red sessions and total losses of around 20%. The ticker has managed to recover since then (not without the help of David Cohen and his promotion) but this shows pretty clearly that similar types of activities do affect the stock performance immensely.

The Seeking Alpha articles on ONCS, however, are a little bit different. In there, the ticker is featured alongside many other small and not so small pharmaceutical companies like Inovio Pharmaceuticals Inc (NYSEMKT:INO), Amgen, Inc. (NASDAQ:AMGN), Onyx Pharmaceuticals, Inc. (NASDAQ:ONXX) etc. and instead of warning investors to stay away (like they did with NVLX), the contributors who authored the coverages are eager to speak about the long-term potential. There is, of course, nothing wrong with that and one day the company might actually manage to achieve a breakthrough. But let's not forget that ONCS is still deep in the development stage and it's still way too early to say for sure if they will manage to do it or not.

In addition to this, it seems a little bit strange how all of a sudden, so many people are eager to share their optimism about the future. We're also quite perplexed by the fact that all of the articles appear on the company Yahoo! Finance profile which means that they are getting much more exposure than they normally would. In many ways, the whole thing shares a lot of characteristics with a promotional campaign and although the authors of the optimistic articles say that they have not been compensated for their efforts, the increased volumes over the last couple of days suggest that the results are pretty similar as 17ARTH.pngwell.

And since we mentioned our old friends, the pumpers, we can't help but say a few words about ONCS' Chairman of the Board, Dr. Avtar Dhillon and some of the other ventures that he is part of. Arch Therapeutics Inc (OTCBB:ARTH) whose stock got pumped no more than two months ago with the total budget exceeding $1.3 million is the first stock that comes to mind. You can see from the chart on the right that the ticker didn't perform all that well and left quite a lot of badly burned 1STVF.pnginvestors behind. Pretty much the same thing happened to Stevia First Corp (OTCMKTS:STVF) (Dr. Dhillon acts as a Chairman of the Board there as well) when they received the promotional treatment back in April 2012. Is that a coincidence? We'll let you decide.

Of course, a fall as grandiose as the ones outlined above doesn't appear to be an immediate danger for ONCS since there isn't a full fledged paid promotion for them, but still, the fact that some people are trying to raise awareness around the stock and the unknowns around the company's future are definitely things worth keeping in mind while making your investment decision.

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