Genetic Technologies Limited (ADR) (NASDAQ: GENE)
Recently, Genetic Technologies has had an incredibly hard time in the market. After a successful fund raising venture, the company issued new shares at a discount; leading to heavy share dilution and falling stock prices. However, the stock started to recover Monday, and continued the upward trends Tuesday. Today on the other hand, things aren’t going quite so well. It seems as though GENE is making a slow and steady decline to the bottom, but you shouldn’t be concerned.
GENE Is Falling Due To A Natural Correction
While looking at the stock chart may be a bit tough today, it’s not the end of the world, or the end of a great investment. When investing in BioTech, it’s important to remember that you’re investing in a market that’s known for quite a bit of short-term volatility with massive price movements in both directions. In this particular case, we’re seeing the classic result of too much growth too fast. Things are definitely going good for GENE, and their stock should show it. However, the massive growth we saw Monday and Tuesday just wasn’t healthy or sustainable. So, what we’re seeing today is a slight, near-term correction putting the value back in lines with reality.
What We Can Expect From GENE Moving Forward
The bottom line is that GENE is a great company that definitely has the ability and desire to grow. With that said, I still think Genetic Technologies is a great long term investment option. However, as with all other small-cap biotech stocks, we’re going to see quite a bit of volatility as the stock makes its way to the top. Unless you’re a day trader, trading on these trends, it’s not worth paying attention to the slight drops we see along the way to the top in my opinion.
What Do You Think?
Where do you think GENE is headed and why? Let us know in the comments below!