Investing in biotech stocks - My experience so far

BrockStoker

adindas said:

BrockStoker said:

Kind of wishing I'd held on to Gritstone now!

https://finance.yahoo.com/quote/GRTS?p=GRTS

+248.51% in one day is a massive increase. From the the history this stock was not a penny stock, so there are reasonabe of wallstreet analysts getiitng involved in valuating and analysing it.

The current Price Gritstone Oncology, Inc. (GRTS) is $22.27

Anylsyts Price targets:

Yahoo Finance:

https://finance.yahoo.com/quote/GRTS/analysis?p=GRTS

Average 11.25, Low 4.00, High 17.00

CNN Finance

https://money.cnn.com/quote/forecast/forecast.html?symb=GRTS

Average 12, Low 4.00, High 17.00

But this analysts price target/ Fair value of  is not 100% accurate and it might not include the recent invention, but good to be taken into consideration when making decision.

I suspect a secondary offering coming, so be careful if you do get on board. I noticed Bionano announced a secondary yesterday too. Many of these small stocks jump at the chance to raise cash after fast/large gains. Personally I stay well away from a stock if it jumps like this, preferring to concentrate on stocks that have yet to be spotted, eg EVFM, which I'm still very bullish on, but as always there is risk, and DD is required.

adindas

As Anticipated the BioNano (BNGO) stock price plunged due to Stock public offering

https://www.globenewswire.com/news-release/2021/01/20/2161341/0/en/Bionano-Genomics-Announces-Pricing-of-200-Million-Underwritten-Public-Offering-of-Common-Stock.html

Many people who do not get used to with individual stock investing will get scared with 10% fall in a day. Without good understanding what make the price fall, some people get panicking and start selling it.

I got it at much lower price so still green even after stock offering. Instead of selling it I have topped top up my position.

moneyfoolish

BrockStoker said:

Top Picks 2021: Arrowhead Pharmaceutical

My top biotech pick for 2021 is Arrowhead Pharmaceutical (ARWR), which operates in one of the most exciting areas of modern medicine — one with numerous potential applications longer-term, notes Genia Turanova, editor of Moneyflow Trader.
https://www.moneyshow.com/articles/tptp2021-55808/top-picks-2021-arrowhead-pharmaceutical-arwr/

According to the HL Director Share Dealing, on Jan 4th, Douglass Given sold 3,000 shares and was left with 119,368 but on Jan 11th it says he sold 4,000 and was left with 12,500! Do you know if this is merely an error by HL or have they missed other sales on their list?

BrockStoker

moneyfoolish said:

BrockStoker said:

Top Picks 2021: Arrowhead Pharmaceutical

My top biotech pick for 2021 is Arrowhead Pharmaceutical (ARWR), which operates in one of the most exciting areas of modern medicine — one with numerous potential applications longer-term, notes Genia Turanova, editor of Moneyflow Trader.
https://www.moneyshow.com/articles/tptp2021-55808/top-picks-2021-arrowhead-pharmaceutical-arwr/

According to the HL Director Share Dealing, on Jan 4th, Douglass Given sold 3,000 shares and was left with 119,368 but on Jan 11th it says he sold 4,000 and was left with 12,500! Do you know if this is merely an error by HL or have they missed other sales on their list?

Not sure to be honest. I would guess it's a HL error. It's not a detail I'd worry about though.

More interestingly, Feb $110 calls are seeing unusual activity. Things have also been unusually quiet in terms of PR/news. I think something significant is just around the corner!

BrockStoker

@adindas

Here's another big mover:

https://finance.yahoo.com/quote/OBLN?p=OBLN&.tsrc=fin-srch

I know nothing about it. Just came across it while browsing YF news.

https://finance.yahoo.com/m/97da5087-bdd1-387f-aa9d-a6dfeb4509ec/obalon-therapeutics-stock.html

adindas

BrockStoker said:

@adindas

Here's another big mover:

https://finance.yahoo.com/quote/OBLN?p=OBLN&.tsrc=fin-srch

I know nothing about it. Just came across it while browsing YF news.

https://finance.yahoo.com/m/97da5087-bdd1-387f-aa9d-a6dfeb4509ec/obalon-therapeutics-stock.html

Unlike technological stock or other stocks. Penny stock in Biotech stock is extremely risky like taking decison in a binary option.

If their therapy, drug testing is succesful, get patent the price is skyrocketing, fail it will plunge and might get delisted.

Because it is a binary option based on the informaion alone there might be a lot of insider tradings taking instant profit, leaking the news to relatives, friends.

And another problem is there are tons of them, so it is very difficult to screen it.

BrockStoker

adindas said:

BrockStoker said:

@adindas

Here's another big mover:

https://finance.yahoo.com/quote/OBLN?p=OBLN&.tsrc=fin-srch

I know nothing about it. Just came across it while browsing YF news.

https://finance.yahoo.com/m/97da5087-bdd1-387f-aa9d-a6dfeb4509ec/obalon-therapeutics-stock.html

Unlike technological stock or other stocks. Penny stock in Biotech stock is extremely risky like taking decison in a binary option.

If their therapy, drug testing is succesful, get patent the price is skyrocketing, fail it will plunge and might get delisted.

Because it is a binary option based on the informaion alone there might be a lot of insider tradings taking instant profit, leaking the news to relatives, friends.

And another problem is there are tons of them, so it is very difficult to screen it.

Yes, this is why I would not invest after such a large SP increase, unless I had done a ton of DD and was happy that the company was still undervalued.

Regarding your other post (diabetes TAM).. it is a one trick pony, although there may be potential, but it's a risky gamble. You'd be better off buying ARWR which has at least 3 therapies in markets with milti-billion TAMs (some probably around $40B or more - would have to check actual numbers, but they are huge), and these 3 I'm 99.9% sure are in the bag, which more than justifies current valuation. On top of that, there will be more indications with similar TAMs, which are already in the pipeline. Due to the science, I believe they will have a high chance of success - RNAi does not have the low chance of success seen in traditional medicine, it either works or it does not, and we know it works, but Wall Street is still not sure, and there in lies the opportunity! On top of that, they will start to add more to the pipeline on a regular basis. It will be fast and steady climb from here I believe.

I'm also still very bullish on Amyris. Like ARWR I believe the current price is more than justified, even after the recent large SP increase. Also like ARWR it has a big moat, and is the leader in it's space. It's also very aggressive, with new molecules constantly being added to the pipeline. It already has fast growing products, and two deals in the works, which if they complete (I think it's more likely than not), will bring in multiple billions. I highly recommend reading a recent post on the YHF message board for AMRS by Brahma (and replies) which sums up the situation well:

https://finance.yahoo.com/quote/AMRS/community?p=AMRS

If the deals are announced (in the next few weeks) then $35-50 share price is likely (current is around $11). In the longer term, I believe the SP will get into the 100s IF all goes well, and I really don't see why it should not. Either way, you are unlikely to loose anything investing at current share price.

BrockStoker

Biotech/healthcare, and in particular vaccine stocks ARE only just getting started I believe. As humans encroach further into relatively undisturbed natural habitats, more potentially dangerous viruses WILL emerge. They are already:

https://www.bbc.com/future/article/20210106-nipah-virus-how-bats-could-cause-the-next-pandemic?utm_source=pocket-newtab-global-en-GB

Now is the time to invest IMHO! I may yet consider buying back Gritstone (and/or other covid/vaccine stocks), but right now I don't have cash so it will have to wait. For those not wishing to hold stocks, I still think funds (OIECs and Trusts) are a great way to play it.

adindas

BrockStoker said:

Biotech/healthcare, and in particular vaccine stocks ARE only just getting started I believe. As humans encroach further into relatively undisturbed natural habitats, more potentially dangerous viruses WILL emerge. They are already:

https://www.bbc.com/future/article/20210106-nipah-virus-how-bats-could-cause-the-next-pandemic?utm_source=pocket-newtab-global-en-GB

Now is the time to invest IMHO! I may yet consider buying back Gritstone (and/or other covid/vaccine stocks), but right now I don't have cash so it will have to wait. For those not wishing to hold stocks, I still think funds (OIECs and Trusts) are a great way to play it.

Based on what I have read Gene editing, Mapping is one of the hot areas that will see the best growth comparing to other sectors in the next few years.

Many of them are still penny stocks so the upside potential is huge. It is only that there are a lot of bogus players as well, ready to scam investors.

The way I save my time is to initially have a look on what wall street analysts have been saying, whether there are reputable institutional investors are willing to invest in this stock, at what price they are willing to buy/sell/hold. If all of that is good it is probably worthy to start investing your own time to investigate it.

BrockStoker

adindas said:

BrockStoker said:

Biotech/healthcare, and in particular vaccine stocks ARE only just getting started I believe. As humans encroach further into relatively undisturbed natural habitats, more potentially dangerous viruses WILL emerge. They are already:

https://www.bbc.com/future/article/20210106-nipah-virus-how-bats-could-cause-the-next-pandemic?utm_source=pocket-newtab-global-en-GB

Now is the time to invest IMHO! I may yet consider buying back Gritstone (and/or other covid/vaccine stocks), but right now I don't have cash so it will have to wait. For those not wishing to hold stocks, I still think funds (OIECs and Trusts) are a great way to play it.

Based on what I have read Gene editing, Mapping is one of the hot areas that will see the best growth comparing to other sectors in the next few years.

Many of them are still penny stocks so the upside potential is huge. It is only that there are a lot of bogus players as well, ready to scam investors.

The way I save my time is to initially have a look on what wall street analysts have been saying, whether there are reputable institutional investors are willing to invest in this stock, at what price they are willing to buy/sell/hold. If all of that is good it is probably worthy to start investing your own time to investigate it.

Yes, I fully agree regarding gene mapping. Picks and shovels. I liked (and still do like) Ten Times Genomics (TXG) for this reason. It made me a reasonable (though not earth shattering) profit. Could be a lucrative long term hold. While I don't currently hold any mapping stocks individually, the Schroeder UK public private trust which I hold has some Oxford Nanopore which is in that space.

Have you got (or considered) holding the Ark Genomics fund? It might be the easiest/safest way to play this theme/space, although I think I'd wait for a significant pullback before investing.

The entire biotech sector is quite high now, and I should have said in my previous post, it might be an idea to wait for a pullback, or at least not go all in just yet!

Going back to the gene mapping though, I also agree, best to be weary of the very small stocks, unless you have done serious DD. Of course Illumina is the go to large cap stock in the space, but it's a slow n steady long term growth type stock that IMO would be a nice compliment to hold in a less racy portfolio along with stocks like Intuitive Surgical (large cap robotic surgery stock), and perhaps some big pharma - that is the kind of portfolio I might consider once I'm done with the smaller/riskier fast growing stocks.