XOMA Ltd. (NASDAQ:XOMA) Rockets on Exclusive News and Stock Alerts
05 Aug 2010

Three days before the second quarter results get announced and discussed by the management, XOMA Ltd. (NASDAQ:XOMA) shares were yesterday successfully healed from their oversold status. The stock soared 15.48% on a record for the past six months trading volume. Nearly 42.2 million shares were traded, almost 11 time the average, and the market closed at $0.32 for a share.

A considerable contribution to the price and volume action must have had the numerous alerts sent out to investors. There is no information about paid stock promotions, though the websites providing those services obviously found the stock a good opportunity to gain investor attention, alerting about the huge volume and the latest press release of the company.

Yesterday, XOMA shares rocketed on positive news from the FDA, which has granted the company’s drug candidate XOMA 052 orphan drug status for the treatment of the rare condition Behcet’s disease. According to the press release, if approved the drug will potentially target certain underdeveloped markets and XOMA may receive tax credits for its further research activities.

Though still unconfirmed, the news sound great for the company which reported worsening financial condition for the first quarter of the year and sees its stock progressively losing value since April this year. On the other hand if the news remain just a PR action, it was a good one and perfectly timed as well, considering the recent dilution news.

End of last month the company entered into an agreement with Azimuth Opportunity Ltd. to maintain a $30 million equity line of credit facility and to sell a specified amount of common shares to that company. According to a filing from Tuesday, the sale of 26.93 million shares was supposed to be settled yesterday for a total purchase price of $7.4 million. The dilution for the current shareholders seems to be worth mentioning, as there were previously 266.6 million shares outstanding.

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