In over 20 plus years of trading the markets, I have never seen such a desperate attempt by short sellers as with Anavex Life Sciences (NASDAQ:AVXL). If one is bearish on a company, attack its products, management, science, technology, etc. But that is not what's happening with AVXL involving its latest controversy on the financial blog site Seeking Alpha. There, the bears have chosen not to attack the company's science, but instead go after a blog poster that actually likes the science behind AVXL. Rather than attack the credibility of AVXL and its science, the short seller is attacking the credibility of someone that wrote favorable articles on AVXL along with many other companies. But since the writer chose to write favorably about AVXL his reputation is attacked. That reeks of desperation from the short sellers.Now this article is not a defense of Kanak Kanti De. I do not know the man at all. Whether his degree is real or not should not matter at all. He voiced his view on Seeking Alpha like any other contributor has the right to do. Just like I have the right to voice my view of AVXL on Insider Financial. Whether people agree with me or not, that is their prerogative.The focus should be on the facts. I wrote about these facts in my earlier article on AVXL titled "Anavex Life Sciences Still Heading Higher In 2016." Here are the key facts about AVXL:
Regarding the potential of ANAVEX 2-73, while I am no scientist leading experts are saying that Eli Lilly and Biogen may have the science all wrong and that AVXL has it correct. The drugs from Eli Lilly and Biogen are just antibodies against amyloid. In all likelihood, amyloid is not the cause of Alzheimer’s. Instead, Alzheimer’s is caused by oxidation and nitration. This is what ANAVEX 2-73 targets!! It’s a completely new approach to treating Alzheimer’s and that makes it so revolutionary. With anything this revolutionary, you will get conventional scientists coming out and bashing the new science. This is what is happening with AVXL because AVXL is disputing the conventional wisdom.
This is what the shorts don't want to acknowledge and what they can't dispute. Backing this up is AVXL has over $15 million in cash and is moving forward with the development program for ANAVEX 2-73. FDA guidance confirms its strategy to move ANAVEX 2-73 (Alzheimer’s) to a larger randomized, double-blinded, placebo-controlled P 2/3 study. This is a huge development for a developmental stage company like AVXL. If there's a chance that the company can cure Alzheimer's, it will help millions and millions of people. How can one not be rooting for the company to succeed? The ones that want it to fail are the greedy short sellers. Since they can't say they want it to fail (even though they do and they're being politically correct), they look for anything else they can attack to hurt the credibility of AVXL. Not only is this wrong, but it's also sad.The worst part is that the article in question actually spooked some nervous longs and they sold. As a result, the stock fell over 11%. The article worked for the bears and they were able to profit off of other's misfortune. This is both unethical and immoral.
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The key for investors regarding AVXL is not what I say or others say. It comes down to the science. The science tells me there's a great chance of some major developments coming from AVXL this year. If the company delivers and proves its treatment for Alzheimer's works, it will be the bears crying as AVXL heads higher. Seeing that the bears are no longer attacking the science leads me to believe that AVXL is on the cusp of some very big things. Sign up below and get our latest alerts on AVXL and all of our other hot stock picks!
Disclosure: We have no position in AVXL either long or short. We have not been compensated for this article.
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