SPAC Searching Conclusion

Alex Bartolozzi

I set out on this project to find, out of the hundreds of Special Purpose Acquisition Corporations listed on the stock market, which one will be a true winner and one to stay around for years to come. A very helpful tool I used for my research was SPAC Track https://spactrack.net/activespacs/

After my research I decided on $CMLF (now $SMFR) or CM Life Sciences as the SPAC I am most bullish on.

Sector Analysis

• Objective is to find which sector was strongest through the recent inflation scares that caused major sell offs in high growth stocks and the SPAC industry and then to look for SPACs specifically in that sector.
  • Strength in a bearish market is very bullish for obvious reasons.
• Below is the chart for different sector etf’s over the past year.

EV

Clean Energy

Tech

Fintech

Healthcare

• All industries cracked at the same time, yet healthcare has had the healthiest recovery making new highs everyday, therefore showing the strength I was looking for.

CM Life Sciences $CMLF (now $SMFR)

• Has a definite agreement to merge with Sema4
• AI and “machine learning-driven patient-centered genomic and clinical data intelligence company” (SPACInsider). 
• “Leveraging data scientists using artificial intelligence and machine learning, the company is powering unique insights that transform the practice of medicine and how disease is diagnosed, treated, and prevented” (SPACInsider).
• Sema4’s database already has more than 10 million genomic profiles and was called the fastest growing “integrated genomic & clinical data platform”
• From the company’s description it sounds to be in a very similar business to Palantir by having machine learning and AI be the base of the company to be used to help guide decision making.
• CM Life Sciences run by Mr. Eli Decatur Casdin, the Chief Investment Officer of Casdin Capital, a fundamental research investment firm that manages a long-short equity fund. Casdin Capital specializes in Healthcare, Biotechnology, Industrials, and Technology. It manages over 2.2 Billion in assets.
• CEO and founder of Sema4 is Eric Schradt. Eric is “a world-renowned expert on constructing predictive models of disease that link molecular biology to physiology to enable clinical medicine. Over the past 20 years, he has built groups and companies (Merck, Rosetta, Sage Bionetworks, Pacific Biosciences, Icahn Institute, and now Sema4) to elucidate the complexity of human diseases” (Sema4).

Financials/Stock Information

• 566 Million Market Cap
• 33 Million Float
• Deal set to be complete by September 2022

Other Information

• Cathie Woods bought for ARK in the low 20’s and it is now trading at 12.80
• Currently has ascending support from 5/11 and just hit support, major test ahead to see if it rebounds up or cracks like it almost did when it hit 12

Future Outlook

• I expect a continuation of this most recent bounce off support in the short term
  • A return to new recent highs above 15.21 would show a lot of strength
• Within the next month I expect a minor 2%-3% pullback on healthcare etf XLV which will bring $SMFR down around 10% (based on past pullbacks in both tickers)
• In terms of a price target for long term I see a return to the ATH of 28.88 not likely within the year but possibly within the next 3 years as long as inflation continues to be viewed as transitory by the fed and high growth stocks receive the backing they formerly had.