For the following reasons:
1. It is trading at historic P/E multiple at this point of time.
2. Management is very strong with high level of vision. FRX will be soon announcing a major win/ FDA approval.
3. Balance Sheet is perfect and loaded with CASH. They can burn cash until they find the right thing that it will put the company back on the growth track. FRX's management is currently working on 2-3 blockbuster drugs.
4. This is not a Large Cap/Dinosaur Pharma. FRX is a hybrid biotech/pharma company with a unique strategy. They have a very small number of employees in comparison to large pharma. FRX is a "lean and mean" pure bio/pharma with outstanding management team and a proven long-term winning strategy for taking successful drugs into the market.
5. FRX will be replenishing soon the revenues of their successful depression drug that becomes generic in 2012. Management is 1-2 deals away from having this completed, according to the street.
Hey, don't have to tell me about analysts.... I don't give them any credence whatsoever. Just that it would be pretty wild for every one of them to be so far off on this one. I'm in at around $37.50, wouldn't mind picking up more under $36, but I also play the odds at these levels (aren't we all just gambling legally?). The chance of it going under 30 is 1 in 10 compared to it going back to the 40's IMO.
Guess I've just been burnt by analysts a little more than usual lately.
And, no worries man. Snydz picks his times to bash and throws about 5 messages in a 10 minute span at you. He's easy to dislike.
bd, sorry for the accusation.... but when you use a term like 'pig' for a stock that analysts are projecting for a 12% return long term and developing a drug that is on the verge of being a blockbuster, can understand why I'd lump you and snydz as one. The market as a whole would have to deteriorate for FRX to test the 20's in my opinion. 2 year low is 35.26 on 10/18/05. You can't tell me, that with the economy stabilizing, FRX is worse off than the last 5 years? I'm not saying that it couldn't happen, but are you predicating a historic 5 year low on the overall market collapsing or FRX proving every analyst wrong?
I thought so. That is profitable and a very good way to make money.
You explained it before when you said you rode their back.
Even I said I dont know when they're gonna leave. Could be 2 hours, 2 days, 2 weeks. Or like I said THEY wait till the news finally throws them out. Even I knew the Sep 5 news wasn't very consequential that's why I took the large profit and waited several days before I got back in.
But the qtr starts next week, earnings and research news will be announced 16 Oct, and the 4th qtr is the expected MILNACIPRAN NDA and other drug approvals soon.
Hope you dont get hurt too much on the last trades. I'm not interested in just a few hundred $ each trade every day. I'm going for more substantial moves which SOMETIME take a while longer than others.
I don't know any of those things. If I did, I'd be on a beach somewhere. I have a hunch. I make somewhat educated guesses. I watch the action during the day. I take chances, based on what I've seen. I'm not saying it's the right way to do things. I'll just say that it works.
Congrats on 80% profitable trades. I don't do that well.
Again, if I did, I'd be retired and on a beach probably.
Oh, it's not difficult fot me. We just do it differently.
And I agree with everything you said. I've clearly said before what's happenning in the market and the process especially the reversal and the buying back after 3pm. That's not something I want to do. And doing what I do I still make over 8% per month my way and 80% profitable trades.
But my questions are these.
How was your strategy affected by the Sep 5th rise Of $4 in a half hour?
How did you know the $2 move up 2 weeks ago was only temporary?
Do you know the people who do the shorting at the hedge funds? Or do you know they haven't left? On Sep 17 after the stock moved up $2 how did you know they didn't leave?
This morning when you said it was going to go down, how did you know the hedgeies were still going to short?
What is your indication that they have left? Or do you just have to see several days to a whole week before you can, after the fact, say they have stopped?
AT SOME POINT, with this specific stock, IT IS going to stop being profitable for them to continue? Where is that?
You said in the 20's. Can you really see this stock going to a PE of 8?
Do the hedgies just wait until the news throws them out?
On Sep 5th I sold for a large profit because I knew the news was not great long term (it was practically inconsequential). But I got back in later because my choice is to invest for MILNACIPRAN and other pipeline development which I know will take strides over the next 3-6 months including successful Phase III trials, NDA's FDA approvals and other teaming arrangements with researchers.