With a history of over-promising and under-delivering to investors, don’t be fooled by AIM ImmunoTech (NYSEAMERICAN:AIM). If AIM stock has been in your crosshairs for buying, do yourself a favor and don’t pull the trigger.
AIM ImmunoTech is a micro-cap biotech. It’s also yet another company on the verge of saving the world from the novel coronavirus. But be warned, don’t trust the hype regarding AIM’s recent patent application for its drug candidate Ampligen or its effort to introduce the product into the Chinese market as a coronavirus prophylactic.
Alongside smaller peers like Inovio (NYSEAMERICAN:IBIO) or Co-Diagnostics (NASDAQ:CODX), which have also come out of the woodwork during the COVID-19 pandemic, issuing tons of interesting sounding promises, I’m concerned.
To be fair, Ampligen exists. And apparently the drug has shown some efficacy to fight the coronavirus’ genetically related SARS virus. But I wouldn’t turn a blind eye towards AIM’s self-inflated marketing and actions within equity markets during the coronavirus.
Notably, the biotech has taken advantage of its good fortune in the stock market as shares lifted from around 55 cents at the beginning of the year towards $7 by early March. Specifically and squarely at the highs in AIM stock, the company filed a well-timed, updated prospectus that allows for the sale of approximately $18 million in stock via an “at the market” offering. Shares of AIM are now fetching about $2.75.
Not that I blame AIM’s calculated move to cash in. In of itself, it isn’t a problem. And it would be silly not too, especially given the company’s cash burn and weak financials. However, alongside AIM ImmunoTech’s terrific-sounding public service updates being broadcast almost exclusively via press releases out of Florida — a state steeped in the tradition of tabloid reporting — don’t say you haven’t been warned.
If you’re still not convinced, AIM stock isn’t the next big deal in biotech and a heir apparent to Amgen (NASDAQ:AMGN) or established large-cap COVID-19 plays Regeneron (NASDAQ:REGN) and Gilead Sciences (NASDAQ:GILD), realize as InvestorPlace’s Vince Martin warns, AIM ImmunoTech has nearly a quarter of a century of broken promises with Ampligen. And it’s all summed up quite elegantly in the long-term price chart.
AIM Stock Monthly Price Chart
Source: Charts by TradingView
The bottom line? As much as I like to root for the underdog, especially when the stakes involve COVID-19, AIM stock is a long shot at best. Worse, if history is any indication and barring a Hail Mary product breakthrough, today’s plug on life support for the stock will be pulled with 100% certainty.
The information offered is based upon Christopher Tyler’s observations and strictly intended for educational purposes only; the use of which is the responsibility of the individual. For additional market insights and related musings, follow Chris on Twitter @Options_CAT and StockTwits.
