The Mission Report

The MissionIR Report - March 2013

In-depth analysis, timely updates, latest market news


Market News

Company Updates


Capital IQ’s Stovall Waves Off Bear Market

The S&P 500 wrapped up February with a fourth consecutive month of gains while the Dow Jones Industrial Average clambered within 16 points of its record closing high of 14,164.53 set October 9, 2007. The Dow’s intraday record high, set October 11, 20117, remains at 14,198.10. For the month of February, the Dow advanced 1.4%, the S&P 500 rose 1.1%, and the NASDAQ gained 0.6%.

After a solid-run up during the first of the year, S&P Capital IQ chief equity strategist Sam Stovall in an interview with Yahoo! Finance’s Breakout says the lack of volatility in the markets historically signals that the market is headed for a pullback (5-10% decline) or correction (10-20% decline), but not enough to turn into a bear market (+20% decline).

Stovall added that the downside risk looks shallow, as does the potential upside.

While will probably see several attempts to challenge the S&P’s top level of 1,565, which was set on October 9, 2007, said Stovall, looking at fundamentals, politics and other macro influences, “I'm not really willing to call for a brand new high just yet."

China’s Real Estate Restrictions Crimp U.S. Stocks

U.S. markets opened the first full week of trading in March under the weight of economic concern overseas after Chinese authorities imposed new real estate buying restrictions to curb the country’s red hot property market. China’s Shanghai Composite Index dropped nearly 4% Monday morning, representing the index’s worst percentage drop in nearly seven months.

The new real estate measures include higher down payments and mortgage rates on second homes in areas with steep increases in property prices. China’s State Council also imposed a 20% capital gains tax on sales of existing homes, which economists say could also dent fundamental demand.

Jia Kang, the head of the Ministry of Finance’s Institute of Fiscal Science Sunday said the restrictions aren’t necessarily set in stone. He added that the new measures could trigger demand for new homes vs. resales as the cost of taxes are passed on to would-be buyers.

"Considering the positive and negative effects of this policy I could see that this isn't a permanent measure,” Kang said Sunday at the Chinese People’s Political Consultative Conference.

Local governments are slated to release more information on implementation plans by the end of March. Until then, Bank of America-Merrill Lynch's chief China economist Ting Lu also warned of near-term pitfalls.

"More detailed measures will be announced by related ministries including the People's Bank of China (central bank) and local governments, so markets should definitely take the edict seriously and be prepared for falling prices of related financial assets," Lu said in a note dated March 3.

Economic Calendar through
March 7

Tuesday March 5

10 a.m. (ET) – ISM Non-Manufacturing Index
Analysts are forecasting the U.S. non-manufacturing sector to hold steady at 55.2 in February. Readings above 50 indicate activity is expanding.

Wednesday March 6

8:15 a.m. (ET) – ADP Employment
Payroll processor ADP estimates that private employers added 175,000 in February vs. 192,000 in January

10 a.m. – Factory Orders
Orders for goods produced in U.S. factories are expected to fall 2.3% in January vs. a rise of 1.8% in December 2 p.m. – Beige book

Thursday March 7

8:30 a.m. – Weekly jobless claims
For the week ended March 2, applications for jobless benefits is expected to rise to 358,000 vs. 344,000 reported for the week ended February 23

8:30 a.m. – Trade balance
U.S. trade deficit forecast at $42.7 billion for January vs. a deficit of $38.5 billion in December

8:30 a.m. – Productivity
Consensus calls for Bureau of Labor Statistics U.S. productivity down 1.6% vs. decline of 2.0% in Q4

8:30 a.m. – Unit labor costs
Consensus calls for unit labor costs to rise 4.1% vs. Q4 rise of 4.5%

12 noon – Household debt
Consensus forecast: -- vs. a decline of 2.0%

Friday March 8

8:30 a.m. (ET) – Nonfarm payrolls
Total nonfarm payroll expected to increase by 160,000 in February vs. an increase of 157,000 reported in January

8:30 a.m. – Unemployment rate
Forecast to remain essentially unchanged at 7.9% for February vs. January

Small-Caps Poised to Give Large-Caps a Run for Their Money

Though largely ignored by mainstream media coverage, small-cap stocks have significantly supported the broader market rally and have remarkable potential for more upside in the year ahead.

The Russell 2000 Index, a measuring stick of the performance of the small-cap market, has returned around nearly 12% during the last quarter, representing about 2/3 of the total U.S. equity reach. Small-caps outperformed large-caps in January, making their contribution to Wall Street is worth a second look.

When the housing market buckled in 2008, small-cap stocks outperformed the logged large-cap market by more than 3%. Because of their resilience to macroeconomic factors such as political issues and concern in foreign markets, a run-up in companies with smaller market capitalization often lends momentum and confidence to large-cap rallies.

Furthermore, data from FactSet shows that small-caps have outperformed large-caps by roughly 40% in seven of the past 10 years and have outperformed large-caps both times the major markets lost value in this decade.

While there are market analysts on both sides of the fence, some banking on small-cap favorable historical trends while others question whether the stocks can maintain the pace, the prevailing mood is that the small-cap market is set-up to benefit from broader market variables such as earnings growth and an increase in M&A activity as larger companies seek out small-cap acquisitions to secure a foothold in niche markets.

Dan Veru, chief investment officer at Palisade Capital Management, recently told CNBC that the M&A cycle is just getting started, adding that so far this year, there have been 13 deals involving Russell 2000 companies.

Cardium Therapeutics, Inc. (CXM)

Cardium Therapeutics announced that the American Podiatric Medical Association (APMA) has granted its prestigious Seal of Approval to Excellagen®, Cardium’s advanced, FDA-cleared wound care product, for improving foot health and mobility. Excellagen is a syringe-based, professional-use, pharmaceutically formulated 2.6% fibrillar Type I bovine collagen gel that functions to activate the wound healing process and accelerate the growth of granulation tissue. Excellagen can be used to treat neuropathic and diabetic foot ulcers, pressure ulcers, venous ulcers, surgical wounds, and other dermal wounds.

APMA, the nation’s leading professional organization for podiatrists, has 53 state component locations across the United States and its territories, with a membership of more than 12,000 licensed podiatrists. Excellagen passed an extensive scientific review by a panel of APMA members and was recommended by a committee of Doctors of Podiatric Medicine (DPMs) to the APMA Board of Trustees. For more information, visit

About Cardium Therapeutics, Inc. (CXM)

Cardium Therapeutics, Inc. is a health sciences and regenerative medicine company focused on acquiring and strategically developing new and innovative products and businesses to address significant unmet medical needs. Comprised of large-market opportunities with definable pathways to commercialization, partnering, and other economic monetizations, Cardium's current portfolio includes the Tissue Repair Company, Cardium Biologics, and the company's in-house MedPodium Health Sciences healthy lifestyle product platform.

The company's lead commercial product Excellagen® topical gel for wound care management recently received FDA clearance for marketing and sale in the United States. In addition to plans to advance the product's commercialization in the U.S. and internationally via strategic partnerships, the company plans to develop new product extensions for additional wound healing applications and is working towards securing approval for marketing and sale in South Korea and through the CE Mark application process in the European Union.

Generx®, Cardium's lead clinical development product candidate, is a DNA-based angiogenic biologic designed to treat patients with myocardial ischemia due to coronary artery disease. Cardium recently initiated its Generx Phase 3 / registration study in Russia. Consistent with its capital-efficient business model.

Cardium is also actively evaluating new technologies and business opportunities. The company utilizes its team's skills in late-stage product development to bridge the critical gap between promising new technologies and product opportunities that are ready for commercialization. Cardium is dedicated to building on its core products and product candidates to continually create new opportunities for greater success. Leveraging the advantages of its capital-efficient, asset-based business strategy, the company provides a diversified and more balanced portfolio of risk/return opportunities with the chief objective of providing long-term shareholder value.

Chanticleer Holdings, Inc. (HOTR)

Chanticleer Holdings recently announced the launch of its sweepstakes for one lucky winner to win a trip for two (2) to the 17th Annual Hooters Swimsuit Pageant in Las Vegas, NV. The international Pageant is taking place in June 2013.

Sign up to receive Chanticleer Holdings email alerts at to enter for a chance to win the VIP trip for two to Las Vegas, Nevada, consisting of two round trip air-fare tickets, one hotel room for two, two tickets to watch the 17th Annual Hooters Swimsuit Pageant live, and two VIP passes to the Hooters® events surrounding the Pageant.

About Chanticleer Holdings, Inc. (HOTR)

Chanticleer Holdings, Inc. owns and operates Hooters® branded restaurants in emerging international markets. As one of the most well-known restaurant brands in the world, Hooters has a menu that consists of moderately-priced American bar food and the world-famous Hooters girls. The company has ownership interests in the parent company of the Hooters brand, Hooters of America (HOA), four Hooters restaurants in South Africa, one restaurant in Hungary, one Hooters restaurant in Australia, and the exclusive franchise rights to develop and operate Hooters restaurants in three of the most populous states of Brazil: Rio De Janeiro, Minas Gerais, and Espirito Santo.

The first Hooters® restaurant opened October 4, 1983, in Clearwater, Florida. Today there are more than 430 Hooters restaurants in 28 countries. During its history, Hooters has continued to rank high amongst the industry's growth leaders. The Hooters concept has stayed true to its roots with its beach-themed concept, logo, uniform, menu and ambiance being similar to what existed in its original store, and has proven successful in small-town America, major metropolitan areas, and internationally.

In 2011, Chanticleer (NASDAQ: HOTR; HOTRW), together with a group of major private equity investors, acquired Hooters of America (HOA) and its largest franchisee Texas Wings, Inc. Today HOA is the Atlanta-based operator and the franchisor of over 430 restaurants in 28 countries. Chanticleer has rights to develop and operate restaurants in South Africa, Hungary, and parts of Brazil, and has joint ventured with the current franchisee in Australia, while evaluating several additional opportunities.

Chanticleer's core growth strategy involves expanding the Hooters® brand in emerging markets and other rapidly developing global economies. The rising number of middle class consumers in emerging markets is driving the demand for recognized international brands. Targeting underpenetrated international markets with proven market success, the company aims to achieve consistent, above-average growth rates and favorable financial returns for its shareholders.

Duma Energy Corp. (DUMA)

Duma Energy earlier received additional results from a recent field outcrop study on its 5.2 million acre concession in northern Namibia. Final lab analyses have indicated significant reservoir porosity as well as the presence of degraded crude oil. In-house resource estimates at the structural Oponono Prospect range from 235 million (P90) up to a potential 1.1 billion (P10) barrels of oil. P50 resources at Oponono Prospect are estimated at 650 million barrels of oil.

"This marks another milestone for our 5.3 million-acre concession in the Republic of Namibia in southern Africa," stated Jeremy G. Driver, Chief Executive Officer of Duma Energy. "The resources of the Namibian concession increasingly appear to have the potential to add significant value to Duma and its shareholders. We remain very encouraged by the results and look forward to providing our shareholders with even greater insight into these project developments as they become available."

About Duma Energy Corp. (DUMA)

Duma Energy Corp. is an aggressive growth company actively producing oil and gas in the domestic United States, both on and offshore. Leveraging its technical expertise, promising portfolio, and strong financial condition, the company plans to utilize domestic revenues and cash flow to fund its rapid growth through acquisition, while participating in transformational projects with the potential of providing exponential returns for shareholders.

The company's primary goal for fiscal year 2013 and beyond is to drive earnings growth. The company also aims to pursue listing on major exchange(s) to provide better visibility and liquidity to shareholders and financial partners. Already producing and generating revenue from oil and gas in Texas, Illinois, and Louisiana, Duma projects domestic production to exceed 2,500 boepd projected by the end of 2013.

Duma was founded in 2005 and began trading on the OTCBB in 2009 via registration. In 2006, the company began producing from its first properties in Texas and soon after added production in Louisiana. In 2009, its new CEO Jeremy G. Driver came on board. Within one year, Mr. Driver had identified and negotiated an acquisition that would fundamentally reshape the company. This acquisition was made possible by the large direct cash investment by Mr. Driver and his family, as well as other investors.

The company uses only industry standard and time-tested technologies, and avoids unproven "resource plays" and other opportunities that are heavily dependent upon high commodity prices. Not bound by any geographical location or operational strategy, Duma's management team is focused on developing its existing portfolio while pursuing additional opportunities that provide rapid growth, leveraging growing revenue, cash flow, and reserves to accelerate its growth strategy.

VistaGen Therapeutics, Inc.

Yesterday, VistaGen Therapeutics announced it has entered a new collaboration agreement with Celsis In Vitro Technologies (“Celsis”), the premier global provider of specialized in vitro products for drug metabolism, drug-drug interaction, and toxicity screening. The two companies aim to characterize and functionally benchmark VistaGen’s human liver cell platform, LiverSafe 3D™, for studying and predicting human liver drug metabolism.

Utilizing Celsis’ experience and expertise in in vitro drug metabolism, VistaGen aims to demonstrate the accuracy of its human liver cell platform. In this strategic collaboration Celsis will not only validate VistaGen’s stem cell-derived liver cells in traditional pharmaceutical metabolism assays, but will also determine genetic variations in VistaGen’s pluripotent stem cell lines that are important to drug development. VistaGen also will utilize Celsis’ human cadaver-derived liver cells, currently used throughout the pharmaceutical industry for traditional drug metabolism assays, as reference controls with which to monitor and benchmark the functional properties of LiverSafe 3D™.

About VistaGen Therapeutics, Inc. (VSTA)

VistaGen Therapeutics 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 once-promising drug candidates that have been discontinued during late-stage preclinical development 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 heart and liver toxicity of promising new drug candidates long before they are ever tested on humans.

By more closely approximating human biology than conventional animal studies and other nonclinical techniques and technologies currently used in drug development, VistaGen's human stem cell-based bioassay systems can improve the predictability of the drug development cycle and lower the cost of new drug research and development by identifying product failures earlier in the cost curve. According to the Food and Drug Administration even only a ten percent improvement in predicting failure before clinical trials could save $100 million in development costs, which savings ultimately could be passed on to patients.

Using mature human heart cells produced from stem cells, VistaGen has developed and internally validated 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. VistaGen is now focused on using CardioSafe 3D™ to generate up to two new, safer small molecule drug rescue variants every twelve to eighteen months. VistaGen anticipates that these drug rescue variants will be modified versions of once-promising new drug candidates that have been discontinued by pharmaceutical companies and academic research institutions because of heart toxicity concerns, despite substantial prior investment and positive efficacy data demonstrating their potential therapeutic and commercial benefits.


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