The selloff of Ocugen (NASDAQ:OCGN) look like it will continue for a third day after the biotech’s share price touched a six-month high on Monday. OCGN stock lost 12.8% yesterday on heavier-than-average volume.
The declines come amid recent filings of insider selling and ahead of tomorrow’s release of first-quarter 2021 financial results. The company has a disappointing earnings surprise history, having missed expectations in three of the trailing four quarters, Zacks Equity Research noted earlier this week.
To be sure, it’s often said insider selling can be a tip-off that insiders know their stock is about to underperform the market. While that’s sometimes true, it’s also true that quite often insiders sell for personal financial reasons that have absolutely nothing to do with bad times ahead for their company.
OCGN Stock Boosted by India Crisis
President Joe Biden and his administration, in opposition to the U.S. pharmaceutical industry, yesterday came out in favor of waiving intellectual property protections for Covid-19 vaccines, a development that could dampen enthusiasm for OCGN stock.
Ocugen’s partner, India’s Bharat Biotech, has developed Covaxin as a Covid-19 vaccine. Over the past couple of weeks, Bharat and Ocugen have detailed hopeful efficacy results. Most notably, Covaxin appears to be effective against some of the coronavirus mutations that are causing concern at the moment.
But as far as OCGN stock goes, investors need to remember a key fact: Covaxin is not Ocugen’s product, as InvestorPlace analyst Matt McCall pointed out yesterday. The company is simply Bharat’s partner.
“So like everyone else, I’m hoping Covaxin proves to be as successful as early data suggests,” McCall wrote. “But that doesn’t mean I’m going to buy, or recommend, OCGN stock.”
On the date of publication, Robert Lakin did not have (either directly or indirectly) any positions in the securities mentioned in this article.
InvestorPlace contributor Robert Lakin is a veteran financial writer and editor, including previous stints with Bloomberg News, McKinsey & Co. and McDonald & Company Investments.