Investing in biotech stocks - My experience so far

BrockStoker

Thrugelmir said:

BrockStoker said:

@Thrugelmir Very true. Of course, the hope here is that rapidly growing revenues/earnings will make these stocks stand out from the rest (those with actual "pie in the sky valuations").

Nasdaq currently has over 400 unprofitable (as yet) growth companies. Simply not feasible for all to meet expectations as they currently stand. That's more than at the time of the Dot Com boom. Biotech is your speciality , certainly not mine. Though I likewise have a passion for UK micro caps. At least with those it's possible (or was) an opportunity to meet and talk directly to the management of the Company at the AGM. 

It's mainly the FANGs that run the show though. I wonder could it be the case that investors have been waiting for earnings? A good earnings season could potentially kick-start the tech/growth sector I'm thinking. Apple and Facebook reported after market close earlier, and both are up in after market trading after reporting good results. Tomorrow could be interesting.

Thrugelmir

BrockStoker said:

Thrugelmir said:

BrockStoker said:

@Thrugelmir Very true. Of course, the hope here is that rapidly growing revenues/earnings will make these stocks stand out from the rest (those with actual "pie in the sky valuations").

Nasdaq currently has over 400 unprofitable (as yet) growth companies. Simply not feasible for all to meet expectations as they currently stand. That's more than at the time of the Dot Com boom. Biotech is your speciality , certainly not mine. Though I likewise have a passion for UK micro caps. At least with those it's possible (or was) an opportunity to meet and talk directly to the management of the Company at the AGM. 

It's mainly the FANGs that run the show though. I wonder could it be the case that investors have been waiting for earnings? A good earnings season could potentially kick-start the tech/growth sector I'm thinking. Apple and Facebook reported after market close earlier, and both are up in after market trading after reporting good results. Tomorrow could be interesting.

Apple , Amazon , Microsoft have been around a long time.  Quietly buying up the competition and their critical suppliers in more recent years to maintain their market dominance. Other than Facebook all over 20 years old as listed companies.   

BrockStoker

Thrugelmir said:

Quietly buying up the competition and their critical suppliers in more recent years to maintain their market dominance. 

That's pretty much what Amyris is doing, except the other way around - Amyris makes the raw ingredients to begin with, so it make sense to buy the companies that will use them (where it can), allowing it to have full control of the whole chain, and maximize shareholder value. Though it's a biotech, it's revenue streams come from sectors ranging from beauty products/fragrances through to high performance jet fuel, vaccines, antibodies, sweeteners, and environmentally friendly plastics, and that is just the start. I don't think there is anything around quite like AMRS (competition is playing catch-up!), and they have the potential to outshine/disrupt major players.

I'd be very interested to hear your take on AMRS, since you like your smaller companies.

Here's a letter from Graham Tanaka which sums up AMRS pretty well:

https://img1.wsimg.com/blobby/go/ab8893a2-4872-4bee-8ef5-80879ac45e9e/downloads/2020.12.22 Special Letter Once In a Lifetime.pdf?ver=1611070193319

Don't you think a company like this could do well in virtually any economic/market environment, once it gets a toe-hold, which is what it's doing right now I believe?
At the end of the day it's revenue/earnings that matter, and if those are consistently good at the very least, then a company should thrive whatever the environment. I think next week will be very interesting in that respect, especially for AMRS.

BrockStoker

Almost missed it, but SA have published another interesting and bullish piece on ARWR:

https://seekingalpha.com/article/4422223-arrowhead-pharmaceuticals-partnerships-boost-bull-case

Edit to add: Also recently posted:

https://www.fiercebiotech.com/biotech/arrowhead-takeda-s-rna-silencing-med-cuts-scarring-rare-liver-disease

Thrugelmir

BrockStoker said:

Thrugelmir said:

Quietly buying up the competition and their critical suppliers in more recent years to maintain their market dominance. 

That's pretty much what Amyris is doing, except the other way around - Amyris makes the raw ingredients to begin with, so it make sense to buy the companies that will use them (where it can), allowing it to have full control of the whole chain, and maximize shareholder value. Though it's a biotech, it's revenue streams come from sectors ranging from beauty products/fragrances through to high performance jet fuel, vaccines, antibodies, sweeteners, and environmentally friendly plastics, and that is just the start. I don't think there is anything around quite like AMRS (competition is playing catch-up!), and they have the potential to outshine/disrupt major players.

I'd be very interested to hear your take on AMRS, since you like your smaller companies.

Here's a letter from Graham Tanaka which sums up AMRS pretty well:

https://img1.wsimg.com/blobby/go/ab8893a2-4872-4bee-8ef5-80879ac45e9e/downloads/2020.12.22 Special Letter Once In a Lifetime.pdf?ver=1611070193319

Don't you think a company like this could do well in virtually any economic/market environment, once it gets a toe-hold, which is what it's doing right now I believe?
At the end of the day it's revenue/earnings that matter, and if those are consistently good at the very least, then a company should thrive whatever the environment. I think next week will be very interesting in that respect, especially for AMRS.

A volatile share price . Suspect that research note caused hot money to leap in.  See there's a first quarter results presentation shortly. An opportunity to get a better insight. Probably one to follow and let the share price drift. Wait for an opportunity to buy in once the interest tails off. 

csgohan4

Looks like EVFM are in trouble, down to 1.22, from their high of 5$ earlier. Their earnings call at 1630 EST I doubt will improve things, their product has had some side effects with itching and I am not sure one product is going to be enough to save this company. 

We shall see. I hope those invested will see the light of day, but sadly looks like the investment will be a loser on this occasion

Voyager2002

csgohan4 said:

Looks like EVFM are in trouble, down to 1.22, from their high of 5$ earlier. Their earnings call at 1630 EST I doubt will improve things, their product has had some side effects with itching and I am not sure one product is going to be enough to save this company. 

We shall see. I hope those invested will see the light of day, but sadly looks like the investment will be a loser on this occasion

This is a great buying opportunity.

EVFM have a good product, and if their cashflow fails they will be taken over, with investors getting a fair price for their holdings.

moneyfoolish

Voyager2002 said:

csgohan4 said:

Looks like EVFM are in trouble, down to 1.22, from their high of 5$ earlier. Their earnings call at 1630 EST I doubt will improve things, their product has had some side effects with itching and I am not sure one product is going to be enough to save this company. 

We shall see. I hope those invested will see the light of day, but sadly looks like the investment will be a loser on this occasion

This is a great buying opportunity.

EVFM have a good product, and if their cashflow fails they will be taken over, with investors getting a fair price for their holdings.

I wish I had your confidence! My holdings in EVFM, ARWR and AMRS are pretty disasterous at the moment.

underground99

Voyager2002 said:

csgohan4 said:

Looks like EVFM are in trouble, down to 1.22, from their high of 5$ earlier. Their earnings call at 1630 EST I doubt will improve things, their product has had some side effects with itching and I am not sure one product is going to be enough to save this company. 

We shall see. I hope those invested will see the light of day, but sadly looks like the investment will be a loser on this occasion

This is a great buying opportunity.
EVFM have a good product, and if their cashflow fails they will be taken over, with investors getting a fair price for their holdings.

Well, a 'fair price' is whatever is agreed between seller and buyer. But if they run out of money again, you wouldn't expect the providers of a financial lifeline to make a particularly nice offer from the perspective of the current investors. They would only need to offer something marginally better than the $0 offered by the 'let it collapse' option that investors would be facing.  Whoever taking them over would just need to make some suitable incentives to management or key staff and a 'better than nothing' offer to other shareholders, to take it over as a going concern.

BrockStoker

Frustrating to see everything down again, but as Voyager says, great buying opportunity. I've already got enough EVFM shares, but almost tempted to buy some AMRS in my unwrapped account!

So many babies getting thrown out with the bath water right now it's almost harrowing.