Ocugen Stock News and Analysis: OCGN down in premarket ahead of WHO meeting

  • WHO meeting on Wednesday, Nov. 3, will determine whether Covaxin can receive Emergency Use Listing.
  • Ocugen owns rights to distribute Bharat Biotech’s COVID-19 vaccine in the US and Canada.
  • OCGN stock rose 12.1% on Tuesday in anticipation.

Ocugen (OCGN) jumped 12.1% to close at $15.67 on Tuesday, just one day after it bounced by 18.1% to $13.98. The entirety of the OCGN price rise is anticipation for today, Wednesday, November 3, when the World Health Organization (WHO) is expected to have its final technical meeting concerning the efficacy of a COVID-19 vaccine designed by one of Ocugen’s partners. The stock was down 4.8% in Wednesday’s premarket at $14.92.

OCGN News: 

The day has come. A technical advisory panel from the WHO is slated to determine whether India-based Bharat Biotech’s Covaxin vaccine has all the necessary data to be given an Emergency Use Listing (EUL). The EUL would allow Covaxin to be used in the COVAX Facility, which distributes COVID-19 to hundreds of nations.

If Covaxin is approved, it will greatly benefit Bharat, a private company, but will it benefit Ocugen stock? Ocugen only owns the rights to distribute the vaccine in the US and Canada, and those nations are donors rather than beneficiaries of the COVAX Facility.

Of course, maybe approval of the drug for an EUL signifies a greater likelihood that regulators in the US and Canada will approve Covaxin for their own citizens. The more significant future dates for OCGN shareholders are when Canada approves its application to distribute there and if or when the US Food & Drug Administration approves its phase-3 study. Both of those dates are uncertain, however, so the current market focus on the WHO is the only news to trade on.

Bharat Biotech submitted its forms for EUL listing on April 19. The first meeting with the WHO on October 26 ended with the organization asking Bharat to submit additional information and data. The Technical Advisory Group for Emergency Use Listing is actually and independent advisory commission organized under the aegis of the WHO.

OCGN key statistics                                                                                                                                                                                                                                                                                                                                                                                                                                                                          

Market Cap $2.8 billion
Price/Earnings N/A
Price/Sales N/A
Price/Book 20.2
Enterprise Value $2.2 billion
Gross Margin N/A
Net Margin             

N/A

            

52-week high $18.77
52-week low $0.27
Short Interest 28.7%
Average Wall Street Rating and Price Target Hold $8.88

OCGN Stock Chart: a day of reckoning for traders

Just as we had predicted yesterday, the stock closed at resistance on Wednesday at $15.67. From yesterday’s piece: “At Monday’s closing price of $13.98, the clear target is $16.20. This was the swing high from May 3. That spike was much lower than the February 8 spike that went as high as $18.77. The closing prices on those days were quite close – $15.68 and $15.81. This area may also act as resistance as some traders decide to bail.”

Ocugen is a stock that has trended down for years and has lost as much as 99% of its value since its IPO in 2014. It traded for pennies in 2020 but is up more than 600% this year.

The target for longs remains $16.20, the high on May 3. After that it is $18.77. With the stock already down some 4% in the premarket on Wednesday, however, we think it likely that many in the market have already decided to sell the news. If the stock is not able to break through the current resistance zone and $16.20, then it will likely trade down as far as the 9-day moving average at $10.76.

FXStreet View: The advice stays the same: sell the news. From yesterday: “No matter which way the decision goes at the WHO advisory meeting on Wednesday, OCGN stock is likely to sell off as it has in the past.” If you are holding on Wednesday, now is the time to book profits. This will then allow you to buy back in at a lower price before the decisions by US and Canadian regulators.

OCGN daily chart

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