Don’t count out Cassava Sciences (NASDAQ:SAVA) stock just yet. While the SAVA stock has been wildly volatile, it’s also been wildly profitable.
For example, on Aug, 10, I wrote, “Weakness is a great opportunity with this stock.” Shortly after, SAVA would run from $102 to a high of $126.51. A week later, I added that Cassava could refill its gap, and watched it run from $103 to $123.37. Then, I pressed my luck.
On Aug. 31, I said it was a buy at $74.85 on a pullback… and then watched it sink to $62.20.
While the last one was a dud, I’m still bullish. In fact, here in the low $60’s, I’d use Cassava Sciences weakness as an opportunity, with key catalysts ahead.
Phase 3 Trials Could Start Soon
Cassava Sciences is nearing Phase 3 trials for the treatment of mild-to-moderate Alzheimer’s disease, with millions of Americans in need of help.
Right now, about six million Americans are coping with the disease, says the Alzheimer’s Association. Of that number, it’s estimated that 50.4% have a mild form, says the National Institute of Aging. About 30.3% have a moderate form, while about 19% of cases are considered severe.
If Cassava’s treatment can help, we could be looking at a massive multi-billion-dollar opportunity. We already know the company just reported that cognition scores improved 3.2 points from baseline in its Simufilam studies. Even more impressive, 68% of study subjects improved on ADAS-cog, or Alzheimer’s Disease Assessment Scale-Cognitive at 12 months.
We also know that the treatment can help reduce issues of neuro-degeneration and neuro-inflammation, as highlighted in the company’s investor deck published last month.
Game-Changer for Millions
Despite accusations of wrongdoing in recent months, the company is still moving forward with Phase 3 trials. In fact, if it can continue to show progress in the next phase, I have no doubt the SAVA stock could rocket back to all-time highs.
With Phase 3, there will be two studies of patients with mild-to-moderate Alzheimer’s. The first study will look for improvements in cognition and daily function. The second study will look for signs of a slower rate of decline in cognition.
Again, progress with both could send SAVA back to its all-time highs.
In addition, according to one Seeking Alpha contributor, Cassava Sciences’ Simufilam could see FDA approval before the end of 2022. “Cassava Sciences’ Alzheimer’s treatment has proven to not only slow down but also reverse cognition degeneration in Alzheimer’s patients leaving the door open for early approval,” wrote Jose Solorio last week.
Solorio also noted that a possible pharmaceutical partner was hinted at in the company’s second quarter conference call.
The Bottom Line on SAVA Stock
Bottom line on SAVA stock is that it could be one of the most explosive stocks of the year. All if Cassava Sciences can continue to show progress in treating folks with mild-to-moderate Alzheimer’s.
Sure, there have been allegations of fraud, which have been referred to as “false and misleading” by the company. In addition, another Seeking Alpha blogger — Joe Springer — does a good job at breaking down the accusations against the company, calling them “misleading and wrong-headed.”
In addition, the company is still progressing with Phase 3 trials set for this year. If Cassava Sciences can continue to produce solid results, it could see FDA approval well before the end of 2022, as noted above.
Plus, remember this.
Right now, as we noted above, about six million Americans are coping with Alzheimer’s Disease, says the Alzheimer’s Association. Of that number, it’s estimated that 50.4% have a mild form of the disease, says the National Institute of Aging. About 30.3% have a moderate form, while about 19% of cases are considered severe. If Cassava Sciences can offer the help those millions of people need, it could be game-changing. Not just for those struggling with the disease, but for investors.
On the date of publication, Ian Cooper did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Ian Cooper, a contributor to InvestorPlace.com, has been analyzing stocks and options for web-based advisories since 1999.