What happened

Shares of Celldex Therapeutics Inc. (CLDX 2.29%) closed 13.6% higher on Wednesday. There wasn't any obvious news related to the biotech that served as a catalyst for the stock. Why did Celldex enjoy such a nice bump? Volatility -- both positive and negative -- is commonplace for clinical-stage biotech stocks. A swing of just a few cents makes a big percentage difference for micro-cap stocks like Celldex. 

So what

It's tempting to begin speculating on why investor interest in Celldex spiked on Wednesday. Did positive news leak out about progress on a clinical trial? Is a big company interesting in partnering with Celldex? There are all kinds of potential explanations we could make up about the biotech stock's big move. But the key thing is that we would have to make them up. 

Man with outstretched arms in front of giant stock data screen

Image source: Getty Images.

The only hard news available about Celldex is what the company itself reported earlier this month in its second-quarter update. Enrollment continues for the phase 2 clinical study evaluating CDX-3379 in combination with Erbitux in treating advanced head and neck squamous-cell carcinoma. Celldex is also enrolling patients for a phase 1 study of CDX-1140 in treating multiple types of solid tumors. 

Beyond those announcements, the main story for Celldex is that the company's cost-cutting is helping preserve cash. The biotech slashed its staff and restructured after reporting disappointing results in April for glembatumumab vedotin (glemba) in a pivotal study targeting the treatment of triple-negative breast cancer.

Now what

There are two things that investors should do going forward. First, wait for Celldex to provide more clinical updates. The company should make progress in enrolling for its clinical studies. Celldex also plans to present data from the glioblastoma cohort of the phase 1/2 clinical study of varlilumab and Opdivo at a medical meeting later in 2018. 

Second, investors should monitor Celldex's cash position. The company had cash, cash equivalents, and marketable securities totaling $114 million at the end of June. That's probably enough to fund operations through the rest of 2018 and 2019. Celldex thinks this amount plus proceeds from future stock offerings through its existing agreement with Cantor Fitzgerald should carry it through 2020.

Celldex stock is likely to remain highly volatile. Unless there are clear reasons behind big up-and-down swings in the biotech's share price, the best thing to do is to simply ignore the noise.