Barely a week after news broke that Pfizer (PFE) had kicked Celldex Therapeutics (CLDX) to the curb sending the stock price into a steep and rapid decline, CLDX is already on the rebound with a more than twelve percent jump on Monday.
There has been no news release that would justify the quick reversal, although a round of insider buying just days after the Pfizer news may have provided a boost in confidence for investors who were shaken and stirred by the bad news. That said, the purchases were for 3,000 shares (by Director Harry Penner) and 2,000 shares (by Officer Avery Catling), by no means convincing purchases.
With an hour still to go in the trading day, volume was twice the normal average, indicating that there may be some steam behind the rebound - possibly some short covering - but CLDX is still in a very volatile position, so there's no saying that another dip could not occur.
For those that took advantage of the drop to three dollars, I'd have to say that taking some profits off the table at this time would be a wise move, but I'd also leave some in just in case the run continues and the stock rebounds to previously traded levels; although it would take some good news to support a spike such as that.
Monday was a positive day for investors, and the color of significant green may do wonders to restore investors' confidence, but let's not lose sight that the stock still comes with a good deal of risk.
Let's not be blinded by the bright green on Monday, let's keep it real; there's still quite a bit of risk to go along with the potential rewards.
For those that took advantage of the most recent swing and pocketed some 'European Vacation' money - good on ya, and congrats.
**Published in "Seeking Alpha"
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