Auris Medical Holding AG (NASDAQ: EARS) is having an incredibly rough start to the trading session, which may come as a surprise to many. After all, the only news released by the company this morning has been positive clinical data. Nonetheless, we believe that we’ve found the reason for the declines. Today, we’ll talk about:
- Why EARS is headed down;
- what we’re seeing from the stock; and
- what we’ll be watching for ahead.
Why EARS Is Down
As mentioned above, Auris Medical is having a strong start to the trading session this morning after the company announced positive results from a clinical trial. Before we get into why the stock is falling, lets chat about the data.
In a press release issued early this morning, EARS announced positive results from the second Phase 1 trial evaluating intranasal betahistine in healthy volunteers. In the release, the company said that the treatment demonstrated superior bioavailability over a range of four intranasal betahistine doses compared to oral betahistine, with plasma exposure being between 6 and 29 times higher. Furthermore, the company said that the study confirmed a positive safety and tolerability profile when administered three times daily for three days.
While the data was positive, the stock is down. So, what’s the deal? Well, EARS announced that it would be holding a conference surrounding the results a few days ago. As a result of the announcement, the stock climbed dramatically through both Monday’s and Tuesday’s session. Considering this, even with positive news, it looks like a correction is taking place, bringing the stock down to a more sustainable rate before gains can continue. So, this could be a gret opportunity to buy the dip.
What We’re Seeing From The Stock
One of the first lessons that we learn when we start to dig into the market is that the news leads to moves. This situation was a bit different as the anticipation of the news led to dramatic gains. So, it comes as no surprise that a correction is taking place as investors take profits before gains can continue. Of course, our partners at Trade Ideas were the first to alert us to the gains. At the moment (8:51), EARS is trading at $1.27 per share after a loss of $0.21 per share or 14.19% thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on EARS. In particular, we’re interested in following the story surrounding the company’s continued work to bring intranasal betahistine to market as the treatment is yielding positive results. Nonetheless, we’ll continue to keep a close eye on the news and bring it to you as it breaks!
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