Canadian Penny Stock Investment Opportunity: LIFEBANK (LBK)

Canadian Penny Stock Investment Opportunity: LIFEBANK (LBK)



Biotechnology / Pharmaceuticals Industry: LIFEBANK (LBK)


I’m always actively looking for great investment opportunities and when I came across LIFEBANK (LBK) I was shocked by the potential. At first thought, you would think the services this company provides would be mandatory and run by the Federal Government at an extreme cost to tax payers. This is a unique opportunity to own a stock that may provide a required health service in the future and what I consider to be a no brainer investment opportunity.

LIFEBANK is listed on the TSX Venture Exchange, based out of Burnaby, British Columbia, and is in the biotechnology/pharmaceuticals industry. As of the date this article is written, the share price is currently $0.16 with a 52 week range from $0.10 to 0.19. I believe there is huge growth potential for this company. There are currently no analysts following the stock; however, I am sure that will change in the coming year. This is a high risk investment; although, I believe it is an essential service and will prosper over time.

To enter such a trade I do not recommend using stop losses initially, but I do recommend the following: Once you enter the trade calculate your maximum risk as a full loss of the position – so in my case $0.16 per share. If the stock increases in value to 3R = 3 times the maximum risk ($0.48), then set a stop loss at break even so $0.16. From this point I would suggest you start to employ a trailing stop of 2R ($0.32 below the highest high) so that as the stock moves higher you can lock in some profits just in case things turn sour.

Given that there will be low volume on the stock it is very likely that when you purchase the stock you may have to chase the asking price higher. Since a $0.01 move in the stock represents a 6.25% move in the stock and the bid ask spread is $0.03, an expected entrance for 5000 shares will likely drive the price up over 20-30%. This is not necessarily a bad thing since it will only bring more interest to the stock. If a big move occurs it will likely bring more traders in search of an explosive stock.

News on the company: May 4, 2009 Lifebank Grants Stock Options The company issued options to directors and offices of the company to purchase stock at $0.175 per share until May 7, 2014. This bodes well for purchasing shares today since they are currently bid at only $0.17. Further, after searching around SEDI (This is where you can see what the insiders are doing), it looks like none of the directors or officers are unloading stock.

Now, more about LIFEBANK. Basically, LIFEBANK is the first service in Canada to offer storage and processing of Umbilical cord blood stem cells for the general population. The Umbilical cord blood stem cells can be used in many applications, but the main purpose is their ability to help save a person’s life in the future from diseases related to blood disorders such as many cancers. I for one could have used this service to help save my own life from Lymphoma; instead I had to rely on treatments with much lower success rates that cause much more damage and increase your susceptibility to many other forms of cancer in the future.

For more information about this company including Quarterly and annual reports visit their corporate website @ http://www.lifebank.com/