A look at MannKind Corporation — My friend, the trend.

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MannKind Corporation ($MNKD) averages are at $7.06 (21 day SMA), $5.94 (50 day SMA), $3.47 (200 day SMA). Over the past 52 weeks MNKD has traded from a low of $1.82 to a high of $8.06. MNKD was last at $6.87 on a volume of 6,280,600. Average daily volume has been at 8,767,694.

One of the biotech companies that I follow is MannKind (MNKD), a small diabetes drug researcher currently developing Afrezza, a ultra rapid-acting insulin which, if approved by the FDA, will likely be a blockbuster drug and make the current price of $6.87 look extremely cheap.

Let’s look at the chart.

52 Week Range $1.82-$8.06
Market Cap 1,998,361,408
Average Volume 8,767,694
Dividend Yield 0.00%
Institutional Ownership 15.60%
Insider Ownership: 1.90%
Percentage of Float Short 15.70%
Beta 1.38

The 50-day moving average has bee trending higher in at a pretty steep angle for the past few months. You can see a volatility breakout in mid-May that pushed the stock from $4.00 clear up to $8.00 before backing off. Looks like a blow-off top to me, right? However, the sudden pullback took 25% off the market cap in about a week…but that’s where the stock stabilized. So it is clearly under accumulation and volume is much higher than average.

I think MNKD is a buy on any pullback to $6,.00, and a breakout above $8.00 would likely result in a breakout as shorts scramble to cover. 30% of the float is held by short sellers. So there is a big bet that Afrezza will not be approved. But is that really where the smart money is? The stock was trading below $2.00 last October. Do you want to be on the side of the trend, or do you want to bet against the crowd?

I’m with my friend, the trend.

MannKind Corporation is engaged in the discovery, development, and commercialization of therapeutic products for diabetes and cancer in the United States.

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