Quick Win By The Algorithm: SNMX Leaps Forward On Improved Liquidity

Quick Win By The Algorithm

On November 15th, 2017, I Know First issued a bullish 7 day forecast for Senomyx, Inc. (NASDAQ: SNMX). The forecast showed a signal of 81.70 and a predictability of 0.12. In accordance with the forecast, SNMX’s stock returned 47.22% over this period, solidifying another quick win by the I Know First algorithm.

Senomyx, Inc. discovers, develops, and commercializes flavor ingredients and natural high intensity sweeteners primarily for the packaged food, beverage, and ingredient supply industries. It develops and/or commercializes sweet, savory and salt flavor ingredients, bitter blockers and cooling agents. The company licenses its flavor ingredients to its collaborators on an exclusive or co-exclusive basis, as well as sells various flavor ingredients directly to flavor companies. Senomyx, Inc. has collaboration agreements with Ajinomoto Co., Inc.; Firmenich SA; Nestlé SA; and PepsiCo, Inc. The company was founded in 1998 and is based in San Diego, California.

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Senomyx Inc.’s stock made a strong leap forward from November 15th to November 22nd.  The steady appreciation on above average volume was a result of two factors.  First, the market digested the news from November 14th that Senomyx was monetizing a non-core asset.  Specifically, SNMX entered into a deal with Firmenich, the world’s largest privately owned company in the fragrance and flavor business, to expand their Cool Program collaborative agreement.

Improved Liquidity

What this means is that Firmenich will be granted an exclusive license to CoolmyxTM CL19 and related cooling ingredients in all product categories.  Firmenich, for their part, will give Senomyx an upfront payment of $10 million, which is much needed because SNMX has been low on cash.

The second factor that bodes well for Senomyx is their decision to terminate the purchase agreement they had with Lincoln Park Capital Fund.  This type of financing is sometimes called death spiral financing because it allows the purchaser to get shares at a discount and then sell them directly into the market to lock in gains.  The termination is positive because it means that SNMX must be confident about their liquidity in the near future which means they might receive upfront payments from a new deal soon.

Current I Know First subscribers received this bullish SNMX forecast on November 15th, 2017


Before making any trading decisions, consult the latest forecast as the algorithm updates predictions daily. You can use the algorithm for intra-day trading. The predictability tends to become stronger with forecasts over longer time-horizons such as the 1-month, 3-month and 1-year forecasts.