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A biotechnology stock that insiders are very active in here is
CytRx(CYTR - Get Report), whose oncology pipeline includes three programs in clinical development for cancer indications. Insiders are buying this stock into some extreme weakness, since shares are down by over 30% in the last three months.
CytRx has a market cap of $50.89 million and an enterprise value of $23.97 million. This stock trades at a steep valuation, with a price-to-sales of 508.94 and a price-to-book of 29.63. Its estimated growth rate for this year is -116.9%, and for next year it's pegged at 29.3%. This is a cash-rich company, since the total cash position on its balance sheet is $26.93 million and its total debt is zero.
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A beneficial owner just
bought 1.2 million shares, or about $3 million worth of stock, at $2.50 per share. This same beneficial owner also just
bought 180,000 shares, or about $451,000 worth of stock, at $2.51 per share.
From a technical perspective, CYTR is currently trading well below both its 50-day and 200-day moving averages, which is bearish. This stock has been downtrending badly for the last four months, with shares dropping from $5.50 to its recent low of $2.33 a share. During that downtrend, shares of CYTR have been consistently making lower highs and lower lows, which is bearish technical price action. That said, shares of CYTR have now entered extremely oversold territory since its current relative strength index is 16.30. Oversold can always get more oversold, but it's also a condition where you can look for a sharp bounce higher.
If you're bullish on CYTR, then I would look for long-biased trades once it manages to take out some near-term overhead resistance at $2.50 to $2.53 a share with high volume. Look for a sustained move or close above those levels with volume that hits near or above its three-month average action of 157,505 shares. If that breakout triggers soon, then CYTR could re-fill some of its previous gap down zone that started just above $3 a share. It's possible that off an oversold bounce, CYTR could tag $3.33 to $3.70 a share.