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Insmed Incorporated Message Board

  • thinkabout1120 thinkabout1120 Mar 11, 2014 2:14 PM Flag

    I have seen this before

    Great way to manipulate the stock price prior to a buyout. Hire some firm to “paint the tape” that is a couple of people buy and sell low to move the stock price. This will then cause the “trailing stops” to kick in followed by others who seeing the price drop so further drop the stock price.
    Then out of the “blue” we get a buyout offer. I have been on message boards where this has happened in past. Let’s see if we get the same play here. What do you all think? Nothing going on to move the $ like what we see here. Don't be too surprised if we get an offer in the next few months.

    Sentiment: Strong Buy

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    • They should go to jail.

    • Insm has been on the radar for a very long time. Likely the Arikace product has also been on the radar. Iplex, although currently shelved, is completely viable for short stature among other things - and a $200 million marketplace. We've all asked ourselves why, given the shelving of its only competition, hasn't it been licensed by the folks who built the Increlex market? It makes no sense to just abandon it without recourse when their is an alternative. They could simply trade the patent to Insm for shares or cash and get something out of it. But, nothing. Toss in positive Phase 3 results for CF, positive efficacy for a one year period (unheard of in the CF space) and all of the other breadcrumbs and clearly there must be something going on in the back channels. What it is we will know soon.

      Sentiment: Strong Buy

      • 1 Reply to jad9000
      • Jad. Regarding the short stature, if Insmed is viable as an alternative, and nothing has been done to eliminate or purchase the competition, it does make no sense as you say. Would the owner of the shelved competition be willing to negotiate in the back channels, or would he play games in the marketplace to try and obtain a lower price? Or would he do both. Would Novartis do the same thing?

    • There may be a potential "buyout" or even a partnership but I would suspect that Schimmer's $45 (newly minted) price target is close to what that might be. FUD is correct as to what the calculation should be and for now this assumes a positive NTM PH II readout.

      Sentiment: Buy

      • 3 Replies to justarook04
      • Agreed. But a 2014 buyout valuation would still be based upon the revenue the acquiring company expects the acquired assets to be generating in 2024 or 2034.

        And the best bit is that the more the acquirer pays, the better the acquisition looks to its shareholders.

        Provided a few pet analysts come out with generous predictions of revenue ten or twenty years down the line which are supported by believable arguments, that's all that matters to a CEO looking to keep his job.

        In ten or twenty years time very few shareholders will be looking back at the acquisition price even IF the CEO is still in the job.

      • Rook, in my experience these analysts very rarely set price targets which are many multiples of the then share price. I doubt it's safe to take any of the current price targets as fair market valuations.

        I somehow doubt you'd argue that any current target prices in the likelihood that Arikace will be used extensively as a therapy for MDR-TB - currently infecting around 630,000 Worldwide each year.

      • Re your valuation around $45, what anticipated peak revenue do you base that on?

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