In the stock screening software that I use, I can slice and dice information in seemingly millions of ways.  Today, I searched for companies that were on a prolonged downtrend of 8 days or more.  Many of the companies that I found in the inauspicious group deserved to be there.  One didn’t:  Ariad Pharmaceuticals, Inc. (ARIA)

ARIA has had an distressing TEN (10) down days in a row. I searched news for reasons for such a prolonged decline and couldn’t find any.  They had no FDA turndowns, no going concern issues, no debt restructuring that will wipe out all common stockholders….NOTHING.

All I could find was a company that had a strong balance sheet, good liquidity and some VERY promising drug candidates.   ARIA is a biotechnology company focused on developing drugs to fight cancer.  They have two drugs: Ridaforolimus and AP24534 that, according to the company, look have great potential.  The links are for my readers to read about these drugs themselves.

The main issue facing the company is financing…because of their high cash burn rate.  The company is not under any going concern cloud currently, but they are going to need more money either through an equity raise, debt or co-development funds from partners like Merck (on Ridaforolimus).  Based upon what I see and my conversations with the company, I don’t think that will be a problem.

The chart speaks volumes to me:

The stock has rallied slightly today, but after such a long decline, I wouldn’t be surprised if it roars back.  Long-term this could be a very good stock to own, but since I am not a long-term investor forget I said that.

Short-term doesn’t look bad though.  ARIA is a very well put together company, IMO.

Good luck and good trading!