Harriet Lefton

About the Author Harriet Lefton

Harriet originates from the UK where she worked as a journalist specializing in the metal markets. She graduated from the University of Cambridge before becoming a qualified UK lawyer.

Monday’s Market Insights: Mobileye NV (MBLY), Heat Biologics Inc (HTBX), Nobilis Health Corp (USA) (HLTH)


 

Mobileye NV (NYSE:MBLY) shares are soaring by 29% on Monday morning following the announcement that computer-chip giant Intel is acquiring Mobileye for $15.3 billion, the biggest ever exit in Israeli history. Intel is paying a significant premium for vehicle safety and automation systems company Mobileye, which had a market cap before the announcement of $10.5 billion. The transaction places Intel at the front of the autonomous car market which could be worth as much as $70 billion by 2030.

According to Mobileye co-founder and CEO Ziv Aviram said, “We expect the growth towards autonomous driving to be transformative. It will provide consumers with safer, more flexible, and less costly transportation options, and provide incremental business model opportunities for our automaker customers… Together, we will provide an attractive value proposition for the automotive industry.”

Mobileye and Intel’s Automated Driving Group will form a new autonomous driving organization based in Israel and led by Prof. Amnon Shashua, Mobileye’s co-founder and CTO. The transaction is expected to close in the next nine months, subject to certain regulatory approvals and closing conditions.

Mobileye specializes in vision-based driver assistance systems (using mono-cameras) that provide warnings of collision or car migration, although its technology also supports a wide range of ADAS (advanced driver assistance system) products. The company is in fact already working with BMW and Intel, and the trio intend to have a fleet of 40 driverless test cars on the road as soon as 2H17.

The analyst consensus rating on Mobileye is strong buy according to financial accountability engine TipRanks (10 buy, 5 hold, 0 sell ratings). Most recently, 4-star Citi analyst Itay Michaeli reiterated his buy rating on the stock following a management meeting which highlighted Mobileye’s competitive position and prior expectations for rising selling prices over time.

Heat Biologics Inc (NASDAQ:HTBX) shares are up 12% in trading after the company announced that it has received encouraging data for its lung cancer trial. The company achieved the efficacy endpoint for its Phase 1b trial of HS-110 (combined with checkpoint-inhibitor nivolumab) for non-small cell lung cancer (NSCLC) and will now progress to a Phase 2 trial. Five out of 15 patients treated with the HS-110/nivolumab combination had 20% or greater tumor reduction.

“Although this is a small sample size and a non-randomized trial, we believe that this is an encouraging sign that the combination may be more effective than checkpoint therapy alone and could provide therapeutic benefit to a majority of lung cancer patients who do not respond well to checkpoint monotherapy” says Jeff Hutchins HTBX’s Chief Scientific Officer.

Checkpoint therapy blocks certain proteins made by some types of immune system cells, which can keep T cells from killing cancer cells. When these proteins are blocked, the immune system activates and T cells can kill cancer cells more effectively.

Currently Heal Biologics is also conducting a Phase 2 trial with its product HS-410 for patients with non-muscle invasive bladder cancer (NMIBC).

Nobilis Health Corp (USA) (NYSEMKT:HLTH) shares are sinking by 18% in Monday’s trading after the company reported weaker-than-expected fourth quarter earnings. Nobilis reported EPS of 12 cents and revenue of $101.9 million for the quarter versus the consensus estimate EPS of 21 cents and revenue of $98.96 million.

For the full year, the company saw profit of $6.4 million, EPS of 8 cents and revenue of $285.7 million. Nobilis now expects full-year revenue of $310-325 million, down from the consensus $333 million.

“Although we are pleased to report strong total revenue growth of 25% for full year 2016, we are disappointed that we did not meet the profitability goals we set out to achieve for the year,” said CEO Harry Fleming, who blamed higher than expected marketing expenses and overall operating expenses. CFO David Young added that the company had already taken steps to improve its overall cost structure.

Nobilis is a full-service healthcare development and management company, with 24 locations in seven states, including 4 hospitals, 10 ambulatory surgery centers (ASCs) and 10 clinics as well as affiliations with an additional 38 facilities.

 

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