Silence Therapeutics PLC (LON: SLN)

London Stock Exchange-traded Silence Therapeutics Plc is a ribonucleic acid (RNA) technology company. Its operational interests lie in the research and development of pharmaceuticals products. The outstanding market capitalisation of the group stood at £280.57m, which ranks it among the AIM listed stocks traded on the London Stock Exchange.

Management Changes 
In the exchange filing made by the group as on December 17, 2019, the group announced that Iain Ross would be appointed as an Executive Chairman from January 1, 2020, to work alongside CEO, David Horn Solomon and commence a search to find a suitable successor. An update will be made to the market in due course.

Interim Results: H1 FY19 (£’000s)

Source: Co. filings

During the six-months ended as on June 30, 2019, the group’s loss after tax stood at £8.2m against £8.7m reported in the first half of FY18, with operating costs during the period under review driven by increasing R&D spend on SLN124 in preparation to enter the clinic. Cash and cash equivalents and term deposits at the end of H1FY19 stood at £16.5m against £26.5m reported at the end of FY18.  Loss per ordinary share (basic and diluted narrowed to 11.5p from a loss of 12.4p reported during the H1FY18.

Stock Performance 
 
Daily price chart (as on December 31, 2019, before the market close). Source: Thomson Reuters.

Shares of SLN jumped more than 600.0% on a YoY basis, soared up approximately 584% on a YTD basis, bagged around 110.0% in the past three months. However, the stock was declined by approximately 27.8% in the month-over period and approximately 16% in the past five trading sessions.

At the time of writing (as on December 31, 2019), shares of SLN traded 12.0 points or 3.2% lower at GBX 340.0, and in the year-over period, it has registered a 52w high of GBX 613.80 and 52w low of GBX 40.0, respectively, and at the current traded level, the stock traded 45% away from its 52w high price level and approximately 750% above its 52w low price level.

Conclusion 
The group’s loss narrowed in the H1FY19 against the losses it reported in the H1FY18. Also, the group’s SLN124 granted Orphan Drug Designation by the European Medicines Agency for the treatment of β-thalassemia and SLN500 progressed to non-clinical development.

Its shares were among the top-performing equities during 2019, as it surged more than 600% on a YoY basis and approximately 584% on a YTD basis, respectively. However, after registering a 52w high level of GBX 613.80, the stock has plummeted to GBX 340 levels which reflects stock is undergoing for consolidation after a massive rally it registered in the past.

At the current trading level, its shares traded well below its 5-day, 10-day, 30-day and 50-day SMAs, but still traded significantly above its 200-day SMA level of GBX 197.4, which would be long-term crucial support level for the stock. 

Therefore, considering the prevailing downtrend in the stock since a month-over period after recording a steep up rally, we believe the stock is in consolidation phase, where near-term support is tough to locate at the current level, so we recommend investors to keep a "Watch" at the closing price of GBX 358.0 (as on 30^th December 2019), while we look for the growth catalyst in near-term.

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