Without overall market valuation expansion it is very difficult to move stocks between earnings reports. You need some great piece of news (which will effect earnings) like today's earnings projection by the company. The actual release and accompanying conference call should also lift the stock higher. Not long after the 3rd quarter report CELG jumped to $105 and has traded up to $119 and back down. This will give us a base for the next 3 months of 2015. When you look at a chart of last year the 1st half in general was slow but then you see those quarterly bump ups.
Hit $118 today. I thought we would never see $118 again. Based on updated earnings, I think we will only see $118 in the rear view mirror!!!
One day last week DOW up 300 pts and overall market way up and CELG flat to negative. Today market down especially NASDAQ composite and CELG up 2.85% at 1:15 est. Yes it helps today at the JPM15 conference that guidance was raised and lots of talk about what the company is doing but CELG is a beast on its own. I think CELG can still be bought here in the 116+ area with the outlook they provided this morning. Fully loaded with in my CELG position and looking forward to the next several years.
Sentiment: Strong Buy
Take $12.50 and give it a 20X and 25X handle and you get a price between $250 and $312. I would consider that as a base because these guys always under promise and over deliver. I use these lower rates because as this company gets bigger and bigger they start to run into the law of large numbers, so the growth rate may slow some. When we get out there they may even start to pay a dividend. The wild card is that they continue to but back shares, so you would have to adjust even my very conservative numbers higher to compensate. We are talking a market cap numer like AAPL or GOOG.
You also have to acknowledge that they are helping a lot of people. The Crohns disease therapy is really huge. I have known people that suffer through it and this important for them. We sometimes lose sight of the fact that while we may be making a lot of money that our investment is helping a lot of folks. At the end of the day CELG is a beautiful thing.
CELG laid out $12.50 in EPS for 2020. That is far beyond any expectation I had. With a simple 20 P/E on those earnings you get to $250. That is a very conservative estimate. This is easy a 115% gain over 5 years. Buy all dips cause that is the conservative estimates.
Sentiment: Strong Buy
Oil stocks and the big biotechs are in the market index ETF's. Momentum traders in the ETF's kill all stocks. Because the PE's on these stocks are high investors just holding CELG or REGN etc. sell because they know that the market is dragging them down. They may buy back in when the price drops or get into another quick mover. All these people are not investors but speculators. Back in the 1990's AMGN lost 20% of it's value in one day due to an article planted in the WSJ. I owned the stock and new the data were lies. I went on to make 10 times my investment, only selling to pay college tuition for children. If you are an investor and know what you own then don't worry about the noise. I just listened to the kick off speech by our CEO and this company is even a bigger monster than it was yesterday.
people who really understand biotechs and or celg, should not get too excited about one day move...good things continue to come for the company and its a long term hold. but to follow the developments of this company is pretty exciting.