Penny Stock Pick - SNTA
Shares of Synta Pharmaceuticals(SNTA) jumped 6.18% today on bargain hunting following two days decline as the result of the company's disappointing second quarter loss announced on Monday. The stock is currently trading not very far from its 52 week low of $2.55 last month and less than half of the 52 week high last December.
From the financial side the mounting loss wasn't a good sign but the cash position of $48.7 million should be sufficient to carry the company over to next year. The dropping in revenue from $4.6 million to $3.3 million also did not sound like good news.
Although the technical chart still show weakness as the stock is still trading below 50 day MA, the stock shows support at $2.7 and as the stock is near the 52 week low, this could be a safe time to buy.
The insider transactions show positive sign as company directors and officers bought many shares in June between $2.8 and $3.91 per share. The August 5 sell of 4000 shares is something to watch because if that marks the beginning of insider sells, it could be bad sign for the company that just reported bad earning.