Article suggests La Jolla is, "over-sold and undervalued."
Looks like this spike is in anticipation of pending positive announcement(s). The following is from today's Wall Street Journal (online):
>>La Jolla Pharmaceutical Co.
Dow Jones Newswires -- May 12, 1999
La Jolla Pharma Up 15% On Anticipation Of Research Update
NEW YORK (Dow Jones)--La Jolla Pharmaceutical Corp. (LJPC) shares rose
30% Wednesday as investors anticipated an update from the company on the progress of its drug-development research, according to one analyst.
Michael Becker, editor of the newsletter, Beck On Biotech, said the
company is planning to update investors in a month or two, and "word of that is starting to make the stock go up."
The anticipation is causing investors to take a closer look at La Jolla, he said. Up close, the company appears attractive on two counts: It's over-sold and undervalued, Becker said.
"It's over-sold. It's trading below what they spend on research," Becker said. Moreover, the average market capitalization for a company such as La Jolla, with a drug in late stage clinical trials, is higher, he said.
La Jolla, of San Diego, Calif., currently has LJP 394 in phase III
clinical trials for use in patients afflicted with lupus to reduce
levels of deviant antibodies associated with lupus nephritis - a
principal cause of morbidity and mortality suffering from the disease.
Analyst Balaji Kavety, of Fechtor Detwiler, also believes that La
Jolla's stock is rising in response to the company's stepped up efforts to show case its products.
"Although the company has made good progress, in the past company hasn't done a good job of telling the Street about it."
But now, Kavety said, "Investors are beginning to understand the
importance of the company's core Tolerance Technology in a variety of
antibody mediated diseases."
Company officials weren't immediately available for comment.
La Jolla shares recently were up 3/4, or 30%, to 3 1/4 on volume of
143,400 shares, compared with average daily volume of 26,900.
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