Ocugen Inc (NASDAQ: OCGN) is screaming for the top in the market this morning. However, if you’re looking for press releases or SEC filings, you’ll be hard-pressed to find anything. Nonetheless, there’s a good reason for the gains.
On December 28, 2020, the company filed a document with the SEC, outlining the results of shareholder votes. Moreover a scroll through online message boards lets you know how excited investors are about the company’s entrance into the COVID-19 vaccine space. Here’s what’s going on:
Skip to What You Want to Read
- OCGN Shares Results of Shareholder Vote
- Investors Are Excited About COVID-19 Activities
- What Analysts Think About OCGN Stock
- Risks to Consider Before Buying OCGN Stock
- Final Thoughts
OCGN Shares Results of Shareholder Vote
As mentioned above, on December 28, 2020, Ocugen submitted a filing with the SEC surrounding the results of a shareholder vote. While the meeting was adjourned until January 13, 2020, when investors will vote on the increase of authorized shares, all other items were voted on and approved. These include:
- The approval and adoption of an amendment to the Certificate of Incorporation to move forward with a reverse stock split at a ratio of not less than 1-for-4 and not more than 1-for-20.
- The election of three Class III Directors.
- The appointment of Ernst & Young LLP as the Company’s independent registered public accounting firm for the 2020 fiscal year.
- Approval of advisory compensation for certain executive officers of the company.
- Finally, OCGN shareholders voted to hold votes surrounding advisory compensation of executives on an annual basis.
Investors Are Excited About COVID-19 Activities
With all items for which votes were completed receiving shareholder approval, it’s not surprising that investors are excited. However, searching through message boards, you’ll find that few are talking about the results.
So, what’s the big deal?
OCGN has been working with Bharat Biotech surrounding its COVAXIN product. This is a whole-virion inactivated COVID-19 vaccine candidate. In fact, late in December, the company announced that it was putting together a vaccines advisory board.
While OCGN doesn’t own COVAXIN, it does own the rights to commercialize the vaccine in the United States. With the vaccine pushing through the development and regulatory process, this could mean a flood of funding as consumers race to be vaccinated against this deadly illness. So, it’s not surprising that investors are excited about the potential of the vaccine.
What Analysts Think About OCGN Stock
While it’s never a good idea to blindly follow the opinions of experts, even Wall Street analysts, it is a good idea to use expert opinions to validate your own, and at the moment, the experts seem to love OCGN stock.
According to TipRanks, four analysts currently cover OCGN stock, with three rating the stock a Buy, one rating it a Hold, and no Sell ratings.
Risks to Consider Before Buying OCGN Stock
If you’re planning on investing, whether it be in Ocugen, another stock, or any other financial product, you’re going to take on risk. It’s just the name of the game. When it comes to OCGN stock, some of the most significant risks to consider include:
- Capital Risks. As a clinical-stage biotechnology company, Ocugen doesn’t make any money from the sale of its products. Instead it must continue to invest in development and regulatory costs until it receives approval. If the company doesn’t have enough money in the bank to get to commercialization, a dilutive fund raise may be the result.
- Penny Stock Risks. OCGN is a penny stock. As a penny stock, it is riddled with volatility and comes with other general risks seen among the penny stock category.
- Development & Regulatory Risks. Until the company brings a product to commercialization, it will be at the mercy of clinical results and the opinions of regulatory authorities, which could turn negative rather quickly.
While there are risks to consider, there are risks in any investment you make. At the moment, Ocugen seems like an incredibly strong play. In fact, excitement has triggered a short squeeze, leading to a dramatic run for the top.
While there will be profit taking at the end of the short squeeze, it may signal the perfect time to buy as the potential for growth in OCGN stock is hard to ignore.