Volume Spike Investor

Alfacell Corporation (NASDAQ: ACEL) is down some 55% today and has traded as low as $0.70 in early morning trade. Its 52-week high was $2.88, and the 52-week low before today was $1.45.

The company’s average trading volume each day was about 121,000 shares.  It is at more than 1.4 million shares today and we are only 1 hour and 20 minutes into the trading day if you don’t count the pre-market trading since its press release was issued  at 8:00 AM EST.

Alfacell said in its press release that its lead drug candidate failed to improve the survival rates of patients with in unresectable malignant mesothelioma (mesothelioma is generally tied to asbestos).  While the small biotech plans to seek approval based on positive results from a secondary goal, no one is biting.

Alfacel’s market cap is now down to just under $36 million.  The company is now considered an at-risk company may not last through the year or far into next year without an outside handout.  According to the company’s 10-Q, Alfacell lost $3.5 million in the quarter ending January 31, up from $2.5 million the previous year. The firm had a modest $10.2 million in cash on its balance sheet.

Roughly 12-times volume…. Severe Price drop…. Multi-year lows…. Needs cash….

This has the recipe for disaster written all over the packaging.

Jon Ogg
May 29, 2008