Diffusion Pharmaceuticals Inc.

Diffusion Pharmaceuticals Inc. (NASDAQ: DFFN) is a clinical-stage biotechnology business. It tries to prolong the life expectancy of cancer patients by improving the efficiency of existing standard-of-care therapies, including radiation therapy and chemotherapy.

Key Highlights:

• Negative Bottom Line: As the firm has not yet begun to generate any revenue, it reported a net loss of USD 4.53 million in Q1 FY22 compared to USD 4.64 million in Q1 FY21, owing to high general and administrative expenditures offset by research spending.
• Decreased Liquidity Position: The Company had USD 32.6 million in cash, cash equivalents, and marketable securities as of March 2022, compared to USD 46.6 million as of March 2021.
• Diluting Shareholder's Stake: The company is continually issuing common stock and warrants, diluting, and diminishing current shareholders' holdings and ownership in the company.
• Bearish Technical Indicators: On the daily chart, the DFFN price is trading below the downward sloping trend line and facing the same resistance. Furthermore, the momentum oscillator RSI (14-period) is trading at ~48.81, reversing from lower levels. However, On the daily chart, the stock managed to close above the trend-following indicator 21- period SMA, which may act as an immediate support level for the stock. A critical support level for the stock is placed at USD 6.00, while the critical resistance level is placed at USD 8.55.

Stock Recommendation

DFFN is a clinical stage biotechnology company with mounting losses and lowering liquidity. Also, the business is exposed to a lot of regulatory approvals before its products goes commercial. Furter, its shares are hovering in steep bearish zone, with its shares traded well below its crucial long-term as well as short-term support levels of 200-day and 50-day SMAs and leading momentum indicator, the MACD is falling and the spread between 12-day EMA and 26-day EMA is negative, another bearish indicator. Hence, we recommend a "Watch" rating on the stock at the closing price of USD 8.13 up 7.97% as of May 16, 2022. DFFN shares could be reevaluated once it decisively breaks its short-term crucial resistance of 50-day SMA.

DFFN’s Technical Price Chart (as of May 16, 2022). Source: REFINITIV, Analysis by Kalkine Group

 Technical Summary

*Closing Price as of May 16, 2022.

Investors can evaluate the stock based on the support and resistance levels provided in the report in case of keen interest taking into consideration the risk-reward scenario.

Technical Indicators Defined: -

Support: A level where-in the stock prices tend to find support if they are falling, and downtrend may take a pause backed by demand or buying interest.

Resistance: A level where-in the stock prices tend to find resistance when they are rising, and uptrend may take a pause due to profit booking or selling interest.

Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices. 

Note 1: The reference data in this report has been partly sourced from REFINITIV.  

Note 2: Investment decision should be made depending on the investors' appetite on upside potential, risks, holding duration, and any previous holdings. Investors can consider exiting from the stock if the Target Price mentioned as per the valuation has been achieved and subject to the factors discussed above. 

Note 3: The report publishing date is as per the Pacific Time Zone. 

CynergisTek Inc

CynergisTek, Inc. (NYSE: CTEK) is a top-ranked cybersecurity consulting firm that helps businesses in highly regulated areas, such as healthcare, government, and finance, handle rising security and privacy challenges. It uses intelligence, experience, and a proprietary methodology to assess a company's security posture and guarantee that the workforce is trained, equipped, and resilient in the face of attacks.

Key Highlights:

• Subdued Financial Performance: Despite sales of USD 4.67 million in Q1 FY22, the firm continued to lose money in Q1 FY22, with an operational loss of USD 1.14 million compared to USD 1.19 million in Q1 FY21, due to higher operating expenditures, resulting in net losses of USD 0.87 million in Q1 FY22 and USD 0.91 million in Q1 FY21 respectively.
• Industry Below Ratios: In FY21, CTEK had a negative ROE of 9.5%, compared to an industry median of 11.0%. Furthermore, EBITDA margins were negative in FY21 due to increased cost of sales and a longer cash conversion cycle (93.7 days in FY21 vs 30.3 days in the industry median).
• Decreased Liquidity Position: The cash and cash equivalents of the company was USD 1.21 million as of March 31, 2022, against USD 3.57 million as of December 31, 2021.
• Long-term Bearish Trend: CTEK shares are still trading well below its crucial long-term support level of 200-day SMA, implying a stock's long-term bearish trend.
  

Stock Recommendation

CTEK shares are hovering in a long-term bearish zone, with stock traded well below its crucial long-terms as well as short-term support levels of 200-day and 50-day SMAs. Further, the company is weak from fundamental standpoint as well. Hence, we recommend a "Watch" rating on the stock at the closing price of USD 0.72 as of May 16, 2022.

CTEK’s Technical Price Chart (as of May 16, 2022). Source: REFINITIV, Analysis by Kalkine Group 

  Technical Summary

*Closing Price as of May 16, 2022.

Investors can evaluate the stock based on the support and resistance levels provided in the report in case of keen interest taking into consideration the risk-reward scenario.

Technical Indicators Defined: -

Support: A level where-in the stock prices tend to find support if they are falling, and downtrend may take a pause backed by demand or buying interest.

Resistance: A level where-in the stock prices tend to find resistance when they are rising, and uptrend may take a pause due to profit booking or selling interest.

Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices. 

Note 1: The reference data in this report has been partly sourced from REFINITIV.  

Note 2: Investment decision should be made depending on the investors' appetite on upside potential, risks, holding duration, and any previous holdings. Investors can consider exiting from the stock if the Target Price mentioned as per the valuation has been achieved and subject to the factors discussed above. 

Note 3: The report publishing date is as per the Pacific Time Zone.