ROCHESTER, NY / ACCESSWIRE / February 16, 2016 / When speculating on small cap stocks, investors have traditionally profited most from smaller companies that develop a product or service that is eventually sold to a larger company.
In biotechnology, this is essentially the business model. Mid- and Large-cap Biotechs, focus larger portions of their resources on marketing their current portfolio of drugs and treatments, and maintaining relatively tiny research and development budgets; relying mostly on acquisitions to secure new products and growth for the company.
This general theme is also seen in other sectors. Take for instance, online travel. Giants like Expedia and Priceline grow their inventory through acquisitions. In the past few years, the two companies have spent around $11.5 billion in acquisitions, according to industry publication Skift. Generally, investors in the newly acquired companies have reaped huge rewards.
Pure Hospitality Solutions, Inc. (PINKSHEETS: PNOW) looks like it is on pace to be an acquisition candidate for one of the larger online travel agencies (OTAs). Through their Oveedia brand, PNOW operates an OTA focused on tourism to Central America and the Latin speaking countries of the Caribbean; a region currently underserved by OTAs in the $34 Billion Latin American online travel market.
PNOW is quickly building a portfolio of affiliate property listings through Oveedia.com, which will connect tourists with a wider variety of lodging locations, and the region's hoteliers, to a new and untapped customer base.
The reason for optimism amongst investors comes from two major initiatives which show the Company is on the right track:
- Debt Reduction Initiative- setting a course to eliminate over 90% of its toxic legacy debt by year end. Releasing several updates in the last week of January, showing progress on this initiative, the debt reduction has already improved the Company's ability to raise long-term capital
- Content Marketing Initiative- Friday, the Company announced a 'content marketing initiative' for it's brand, Oveedia. In today's internet, 'content is king' and the websites with the most valuable content get the traffic and the business. Oveedia's content strategy will be similar to TripAdvisor, but focused on Central America and the Latin countries in the Caribbean. This will increase traffic and brand recognition, leading to increased revenue for the company selling its hotel packages.
This progress is akin to a biotechnology stock announcing its latest trials, etc. These initiatives could lead to several interesting announcements in the near term, which is a positive for investors.
Speaking of biotechnology, here are a few other companies in the sector we have our eyes on:
Array BioPharma, Inc. (NASDAQ: ARRY) just reported their highest revenue producing quarter of the year, earning over $35 million for the quarter ending December 31st. The stock began rallying this past Wednesday.
Arena Pharmaceuticals, Inc. (NASDAQ: ARNA), a firm in the Medical-Biomedical/Generic space, could be a great candidate to beat earnings estimates. This company has seen a nice streak of surpassing earnings estimates, especially when looking at the previous two finance reports. In fact, in these reports, ARNA has beaten estimates by at least 20% in both cases, suggesting it has a nice short-term history of crushing expectations.
MannKind Corp. (NASDAQ: MNKD) soon-to-be former marketing partner Sanofi (NYSE:SNY), is looking to hand back Afrezza as soon as possible. This could be seen as good news for MannKind's shareholders. MNKD ended up being very volatile last week, which has allowed traders to make a bundle playing the momentum.
All of these companies provide investors some serious upside potential. PNOW in particular being a sub penny stock, may be just as risky as smaller cap biotechs, but also may offer some of the largest gains, if the Company can continue to improve their Oveedia brand and leverage their first mover advantage in Central America.
Except for the historical information presented herein, matters discussed in this article contain forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially from any future results, performance or achievements expressed or implied by such statements. BiotechMarketReport.com, is not registered with any financial or securities regulatory authority, and does not provide nor claims to provide investment advice or recommendations to readers of this release. BiotechMarketReport.com's parent company, may from time to time have a position in the securities mentioned herein and may increase or decrease such positions without notice. For making specific investment decisions, readers should seek their own advice. BiotechMarketReport.com's parent company, may be compensated for its services in the form of cash-based compensation or in equity in the companies it writes about, or a combination of the two. BiotechMarketReport.com's parent company has been compensated a total of $1,500 cash by a non-affiliate third party of PNOW.