One of the standouts of today's afternoon trading session was Immix Biopharma, which logged a 7.9% performance and outperformed the S&P 500 by 8.0%. The Medicinal Chemicals stock is now trading at $1.77 per share and may still have upside potential because it is still -83.91% under its average target price of $11.0. Analysts have set target prices ranging from $8.0 to $14.0 dollars per share, and have given the stock an average rating of buy.
The market seems to share this optimistic view, since Immix Biopharma has a short interest of only 3.1% (this is the percentage of the share float that is being shorted). Each short position represents an investor's expectation that the price of the stock will decrease in the future.
Short selling involves borrowing shares and then selling them at current market prices. In the successful version of the strategy, the shares are purchased at a lower price at some time in the future. The investor then returns the shares to the lender, and keeps the profit made on the sell/buy transaction.
One way to tell how the market is perceiving a stock is to look to its rate of institutional ownership. With their vast resources, hedge funds, pension funds, and wealth managers are able to perform due diligence to a level that most investors cannot. So it follows that their investment decisions may be more educated. But we also know that bankers and portfolio managers can make mistakes too.
So the fact that Immix Biopharma has a low rate of institutional ownership at 3.7% is not an immediate red flag. It just means that something about the company has kept institutional investors from committing -- or the stock is simply flying under their radar.
Overall, there is positive market sentiment on Immix Biopharma because its an analyst consensus of strong upside potential, a buy rating, an average amount of shares sold short, and a very small number of institutional investors. Warren Buffett famously said that in the short term, markets are voting mechanisms, but in the long term, they are weighing mechanisms. This means that long term investors should be aware of a stock's fundamentals before committing.
Buffett was one of the fist investors to focus on free cash flow as a yardstick for a company's health. Here are IMMX's recent cash flows:
| Date Reported | Cash Flow from Operations ($ k) | Capital expenditures ($ k) | Free Cashflow ($ k) | YoY Growth (%) |
|---|---|---|---|---|
| 2022-12-31 | -7,408 | nan | -7,408 | -365.9 |
| 2021-12-31 | -1,589 | -1 | -1,590 | -292.92 |
| 2020-12-31 | -405 | nan | -405 | 49.24 |
| 2019-12-31 | -790 | -7 | -797 | n/a |
