The Mission Report

The MissionIR Report - Mid-January 2012

In-depth analysis, timely updates, latest market news


Market News

Company Updates


Dollar Rises and Euro Retreats

The U.S. dollar strengthened and the euro slumped more than 1% on Friday following news reports that Standard & Poor's will announce that it has stripped France of its coveted triple-A rating.

Agence France Presse reported on its website that S&P had already informed the French government of the decision. Austria is also expected to suffer a rating cut, but Germany and the Netherlands may be able to escape intact, according to the report.

The dollar index, which tracks the U.S. unit against a basket of six major rivals, advanced to 81.461 from 81.313 in North American action late Thursday. For the week, it rose 0.3%.

The euro slid over 1% to trade at $1.2677 versus $1.2826. It posted a weekly loss of 0.4%.

S&P's downgrade of European sovereigns had been expected after the ratings agency had placed 15 euro-zone countries on CreditWatch negative in early December.

Earlier, the euro had rallied in expectation of a strong performance after a sale of Spanish government bonds and short-term Italian debt attracted strong demand on Thursday, said Nick Stamenkovic, fixed-income economist at RIA Capital in Edinburgh.

The euro had hit an intra-day high of 1.288 before being battered by reports of S&P's decision.

The European Central Bank on Thursday left interest rates unchanged at 1%, while ECB President Mario Draghi sounded a cautiously optimistic note on the impact of the central bank's decision to flood the financial system with cheap, three-year liquidity.

Draghi sounded neutral on the outlook for further rate moves, which triggered some short-covering support for the euro/dollar pair, which has seen a heavy build-up of short bets, said You-Na Park, currency strategist at Commerzbank.

The British pound traded at $1.5319 versus the dollar, slipping from $1.5340 and the euro fell versus the sterling to fetch 82.73 pence.

The dollar traded at 76.92 yen versus the Japanese currency, firming from ¥76.77 previously.

Japanese Prime Minister Yoshihiko Noda shook up his cabinet Friday, replacing five ministers. Finance Minister Jun Azumi retained his position.

Consumer Mood on Rise

Consumer sentiment this month hit the highest level since May, with both current and future economic conditions seen as improving, according to data released Friday by the University of Michigan and Thomson Reuters.

The consumer-sentiment index reached 74 in the preliminary reading for January, compared with 69.9 in December. Economists polled by MarketWatch had expected a January reading of 73 on higher stock prices and improving jobs conditions.

"We suspect the apparent improvement in the labor market was the main driving force behind the increases, helped as well by falling gasoline prices and the recent modest rebound in stock markets. Overall, it's encouraging to see confidence rebounding, but it doesn't make up for yesterday's disappointing news on actual retail sales," said Paul Ashworth, chief U.S. economist with Capital Economics.

Jobs growth reached 200,000 in December, according to the Labor Department. Gasoline prices for all grades fell to an average of $3.33 a gallon in December from $3.44 in November, and the S&P 500 is up about 3% from the beginning of December.

The sentiment gauge, which covers how consumers view their personal finances as well as business and buying conditions, averaged about 87 in the year before the start of the most recent recession. Economists watch sentiment data to get a feel for the direction of consumer spending.

According to the data from Reuters, a gauge measuring consumers' views on the current economy rose to 82.6 in January from 79.6 in December. Meanwhile, a barometer for their economic expectations rose to 68.4 from 63.6.

Jennifer Lee, senior economist at BMO Capital Markets, noted that market volatility and troubles in Europe could weigh on consumers.

"The ongoing negative headlines on Europe will dampen confidence and raise uncertainty, for both consumer and businesses. And that's not good…for anyone," Lee said.

Crude Oil Losing Sight of $100

Crude-oil futures fell further under the $100-a-barrel mark on Friday, extending losses after talk of an Iranian oil embargo eased and as jitters over a prospective euro-zone debt downgrade attracted investors who bid up the U.S. dollar.

February futures of light, sweet crude settled lower by 40 cents, or 0.4%, at $98.70 a barrel on the New York Mercantile Exchange.

"It's kind of a carryover," said Tariq Zahir, managing member of Tyche Capital Advisors, referring to crude's late retreat Thursday following a report that Europe would put off an embargo of Iran's oil imports for perhaps a few months.

Tensions over Iran's nuclear intentions and recent military drills in the Strait of Hormuz had pushed oil back above $100 in the past month. The February crude contract fell 2.8% for the week.

Also, "it's hard for crude oil to continue to go up higher with a rising U.S. dollar," Zahir said. The greenback strengthened Friday against the euro following media reports that Standard & Poor's was set to downgrade sovereign ratings on one or more euro-zone nations, undermining euro-zone efforts to solve its long-running sovereign-debt crisis.

Toward the end of floor trading, French Finance Minister Francois Baroin said the country's coveted triple-A rating was cut by one notch, according to Dow Jones Newswires Friday. Baroin said while he would have preferred to hold onto the triple-A, the downgrade anticipated by the markets was not a catastrophe.

The euro fell more than 1%.

Austria was also reportedly set to be downgraded.

Heading into the weekend, protests by union workers in Nigeria over the government's plan to end fuel subsidies were reportedly suspended as discussions between the two sides continued. However, a nationwide strike was still in effect. Nigeria is Africa's largest oil producer, with exports going largely to the U.S. and Europe.

Traders on Friday digested data showing the U.S. trade deficit widened by 10.4% in November, the largest gap since June and the biggest jump in the deficit since May.

The deficit figure of $47.8 billion was well above economists' $44.8 billion consensus forecast. The data may cause economists to trim their estimates for gross domestic product in the fourth quarter.

Adding to the somber mood in the commodity pits, the U.S. financial sector came under pressure after J.P. Morgan Chase missed on fourth-quarter profit.

Also Friday, Goldman Sachs hiked its forecast for West Texas Intermediate crude by 8%, to $113 a barrel on a three-month basis, from $104.50 a barrel previously. Goldman said the energy market isn't embedding an "Iran premium" into the price of oil as the European Union prepares for an embargo on Iranian oil.

A move by Saudi Arabia to fill the supply gap to refiners is now putting downward pressure on prices, but oil prices may move back up once the details of the embargo become known, Goldman said.

Late in Thursday's floor session, Bloomberg News reported, citing a European Union official, that an embargo wouldn't happen for six months to allow Greece, Italy and Spain to find alternative supply.

Among other energy products Friday, natural gas for February delivery fell 1.1% to $2.68 per million British thermal units. The February contract for heating oil also fell, off 0.7% to $3.03 a gallon.

However, February gasoline turned higher, edging up to $2.734 a gallon from $2.731 a gallon on Thursday.

AdCare Health Systems, Inc.

AdCare Health Systems, Inc. recently announced the company has signed a definitive purchase agreement for three skilled nursing facilities in Arkansas for $27.3 million. According to the press release, the acquisition is expected to be completed within the current quarter. The facilities have an aggregate of 439 beds and generate an estimated $22.2 million in gross annualized revenues. AdCare anticipates financing the acquisition with a traditional bank loan.

Chris Brogdon, AdCare's vice chairman and chief acquisitions officer, commented, "This signing brings the total number of facilities we've put under contract to 54 since we began our current M&A program. With our M&A program and the integration of new facilities remaining our major focus in 2012, we continue to evaluate a number of opportunities that fit our acquisition strategy."

About AdCare Health Systems, Inc. (ADK)

AdCare Health Systems, Inc. is an expanding national leader in the development, ownership, and management of assisted living facilities, skilled nursing and retirement communities. The company's 3,600 employees provide high-quality care for patients and residents residing in the 44 facilities that it operates with a total of approximately 3,900 beds/units in service.

As a result of better health management and treatments allowing people to live longer, the Census Bureau projects that the population aged 85 and over could grow from 5.7 million in 2008 to 19 million by 2050. AdCare has been successfully pursuing an aggressive M&A growth strategy to bolster its portfolio during a depressed economic climate to capitalize on the imminent demand for senior care over the coming decades.

The fragmented skilled nursing market presents significant consolidation and acquisition opportunities to well-established providers like AdCare. With approximately 16,000 facilities currently in operation, no single provider has a market share of more than a few percent. Leveraging its seasoned senior management team's substantial senior living, healthcare, and real estate industry experience, the company is focused on advancing its strategic business plan to operate a much larger enterprise.

Since inception, AdCare's mission has been to provide the highest quality healthcare services to the elderly. With nine straight years of record revenue growth, the company has proven its ability to deliver high-quality care and strong operational efficiency. AdCare is well positioned to continue growing rapidly, both organically and via acquisitions, as industry trends and burgeoning opportunities across the U.S. increase the demand for long-term care.

FluoroPharma Medical, Inc.

In recent news, FluoroPharma Medical announced that its president and CEO, Thijs Spoor, will be presenting at Noble Financial Capital Markets' Eight Annual Equity Conference. Mr. Spoor is scheduled to make a presentation to prospective corporate partners and investors on Tuesday, January 17th at 11:30 AM ET. The Company's presentation will be delivered at the Hard Rock Hotel in Hollywood, Florida.

A live audio and high-definition video webcast of FluoroPharma Medical's presentation and a copy of the presentation materials will be available on the Events page of the company's website as well as through the Noble Financial website FluoroPharma Medical recommends registering at least 10 minutes before the beginning of the presentation to ensure timely access.

About FluoroPharma Medical, Inc. (FPMI)

FluoroPharma Medical, Inc. is a biopharmaceutical company focused on discovering and developing patented Positron Emission Tomography (PET) imaging products to improve patient management by evaluating cardiac disease at the cellular and molecular levels. The company is currently advancing two products in clinical trials to fulfill critical unmet medical needs. The agents will provide clinicians important tools for detecting and assessing pathology before critical manifestations of disease.

The company's proprietary molecules labeled with the radioactive isotope of fluorine combined with PET scanning provide non-invasive, highly specific and efficient assessment of heart metabolism and physiology. FluoroPharma's cardiovascular program addresses the largest segment of the nuclear medicine market.

Molecular imaging fulfills numerous unmet needs in diagnosis by enabling visualization, characterization and measurement of biological processes at the molecular and cellular level. Unlike traditional imaging modalities – MRI, CT, and Ultrasound – that reveal the anatomical abnormalities and cause for disease, PET provides insight into physiology and can detect disease before anatomical manifestation is identified. According to GAI, the market for molecular imaging agents currently exceeds $1.7 billion annually and promises rapid growth for the foreseeable future.

FluoroPharma's comprehensive technology platform was developed by scientists at the Massachusetts General Hospital. To date, the company has been issued four US patents and has seven applications pending in addition to strong international protection. With a solid and experienced management team in place and the necessary resources to advance clinical development, FluoroPharma is well positioned to capitalize on its superior imaging technology.

VistaGen Therapeutics, Inc.

VistaGen Therapeutics, Inc. and Synterys, Inc., a medicinal chemistry and collaborative drug discovery company, recently entered into a strategic medicinal chemistry services agreement. The collaboration will further VistaGen's stem cell technology-based drug rescue initiatives with the support of Synterys' medicinal chemistry expertise.

"After evaluating several high quality candidates, we are happy to have selected Synterys as the medicinal chemistry partner of choice for our drug rescue programs," stated Ralph Snodgrass, Ph.D., President and Chief Scientific Officer of VistaGen. "Synterys' scientists bring significant experience in medicinal and synthetic organic chemistry to our collaboration, as well as the skills and infrastructure necessary to drive our programs forward successfully and cost effectively."

About VistaGen Therapeutics, Inc. (VSTA)

VistaGen Therapeutics, Inc. is a biotechnology company applying stem cell technology for drug rescue and cell therapy. Drug rescue combines human stem cell technology with modern medicinal chemistry to generate new chemical variants ("drug rescue variants") of promising drug candidates that have been discontinued during preclinical development ("put on the shelf") due to heart or liver safety concerns. VistaGen also focuses on cell therapy, or regenerative medicine, which includes repairing, replacing or restoring damaged tissues or organs.

VistaGen's versatile stem cell technology platform, Human Clinical Trials in a Test Tube™, has been developed to provide clinically relevant predictions of potential toxicity of promising new drug candidates long before they are ever tested on humans. VistaGen's human pluripotent stem cell-based bioassay systems more closely approximate human biology than conventional animal studies and other nonclinical techniques and technologies currently used in drug development.

Using mature human heart cells produced from pluripotent stem cells, VistaGen leveraged its Human Clinical Trials in a Test Tube™ platform to develop CardioSafe 3D™, a novel three-dimensional (3D) bioassay system for predicting the in vivo cardiac effects of new drug candidates before they are tested in humans. The Company now plans to use CardioSafe 3D™ to build a pipeline of small molecule drug rescue variants of once-promising drug candidates that have been "put on the shelf" by pharmaceutical companies and academic research institutions because of heart toxicity concerns, despite positive efficacy data signaling their potential therapeutic and commercial benefits.

VistaGen is also developing LiverSafe 3D™, a novel predictive liver toxicity and drug metabolism bioassay system for drug rescue applications. In parallel with drug rescue activities, the company is funding early-stage nonclinical studies focused on potential cell therapy applications of its Human Clinical Trials in a Test Tube™ platform. Each of these nonclinical studies is based on the proprietary human pluripotent stem cell differentiation and cell production capabilities of VistaGen's Human Clinical Trials in a Test Tube™ platform.


For more frequent updates, follow us on Twitter!

Home     About Us     IR Services     Investors     Partners     Market Research     Blog     Contact     Disclaimer

© 2012 Mission Investor Relations. All rights reserved.
3645 Marketplace Blvd.   Suite 130-280   Atlanta, GA 30344   404-941-8975