well done...trade a company with a promising, cutting-edge cancer drug for a company that has made horrible cars for years, continues to make horrible cars, is an ancient dinosaur that can't retool its factories, that has already gone bankrupt once, and that likely will go bankrupt again.
Nice trade. GM = see you at $0 in ten years.
If SGEN can push $26 this would indicate that $26 is a likely resistance point. If the stock can't push through it, watch for a correction. $22.50 to $22 is the nearest daily support level, and if breached, it signals a further decline to $20. The beta of the stock is pushing near 2.00 and the historical and implied volatility is to high as people are welling to buy calls the JUN out the money calls are prices to high and so are the JULY. I am more then willing to sell out the money call premiums to any fool that wants to buy them. But we need to remember stocks fall 3X as fast as they go up.
No, I am sell a call spread. Just because the CEO goes on Cramer and makes friends the stock goes up.Also the EBIT and cash flow is not looking good. I mean I can go on and on, but the point is the same there is not enough volume to support this rally. Also I don't think a sample size of <120 patients is enough to reflect the effectiveness of the drug and also were is the short term assets being held in??? Sorry for the lack of details but this is all signs of mutual funds trying to support the new level with there buying pressure and they will dump soon just as the insiders have already done.
-37 SGEN 100 SEP 12 20 CALL
-37 SGEN 100 SEP 12 20 CALL
You chose to focus on EBIT and cash flow of a developmental biotech? Interesting.
You're not alone expecting a drop. You join 32 million other short shares. On the bright side, you can't do worse than they've done.
I have recently added to my position and like you have a been a holder for a while.
I do not want the company to sell because they have to date shown ways of increasing their sales of Adcetris and have numerous collaborations that should continue to have a chance at home runs. I find their model of using others money and their technology as a growth model that works well with little downside. With that I look at any stock purchase as a new investment and do I like the returns I can get based upon my knowledge of the company, its management and what I project to be their revenue stream.
Based upon that analysis I bought in the low 20s. I continue to believe that there should be steady growth and should provide good returns at that entry level. What I can not figure out is how much of the "short squeeze" is happening that may be currently distorting the price. This is my only caveat at this time on an entry price. The question you must ask is whether you believe you could do better elsewhere, with less or similar risk. This of course does not consider the European debt crisis and Euro imploding. Also as a long term holder you may have to consider that you may have too much concentrated risk in one stock.
Positives include looking forward to European approval and announcement of additions to their pipeline, beyond the trials for Adcetris.
Over the next investment time horizon, which should be minimum of three years I beleive that you will do well with a purchase even at this level.
Just my thoughts.
I'm also a long term holder and just sold off some of my position. We are in uncharted territory with the stock at an all time high. I would expect there will be a pullback at some point but tying to figure when or how high we can go is anyone's guess. I was way overweight with SGEN and glad to take a profit. At the same time I wouldn't want to be out of the stock completely at this time. Keep in mind they do not expect a profit until 2014. There is a lot that can happen both good and bad in that time.