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Trius Therapeutics, AŞ Message Board

  • brandonuk03 brandonuk03 Mar 7, 2013 6:20 PM Flag

    Sold TSRX at these levels, here's why

    I'm a long-term bull on TSRX, so don't get this post twisted, but now is time to take profits. I was on this board screaming buy, buy, buy in December at the 4.50 levels and again after the offering. I made a nice return off those buys. I think TSRX has an 80-90% chance of positive data, but I'm not a buyer at these levels and here's why.

    1) At these levels TSRX has already set new 52 week highs because we have about 7-8 million shares of dilution since that 52 week high. For a rough comparison, the 6.50 price in Sept. is equivalent to about 5.50ish today due to dilution, but the price is trading at 6.10 setting a new 52 week high.

    2) Taking dilution into account and looking at the options market, I'm predicting $7-7.50 on positive data. Not much upside left to make it worth your risk here. If the trial for some reason fails, we're probably below $4. Risk-reward is not there. While I don't anticipate failure, anything is possible. IV therapy exposes patients to higher drug levels than the oral form of tedizolid. Higher efficacy IMO, but how will the side effects compare?

    3) I feel there may be lots of sellers after the trial reports data. The next catalyst will be starting 2 other trials for pneumonia and bacteremia with results probably late 2014. I anticipate early 2014 approval for skin and soft tissue infections. That's a lot of "dead" time for your money to be tied up and for interest in the stock to wain.

    I'm hoping for a pullback as we get closer to phase 3 data release and runup players start to exit their positions. A pull back to the mid 5's and I'd become a buyer again. Volume dried up today. If we see sell offs in the the overall market like some people are predicting, TSRX may also pullback. Good luck to all.

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    • "$7-$7.50 on positive data."...right on, way to go Brandon bro!
      ...more to come by next month;
      upgrades by analysts
      potential partnership/buyout
      ...still plenty to push this higher.
      Still need to take out the previous high of $8.74 in 2011

    • Good luck to you. TSRX is going higher, not lower. The catalysts are in place to dramatically move this stock higher. See you at $10.

      Sentiment: Strong Buy

    • If you are a trader, you messed up. BOOO! BOOO!

      Now you can pay tax and buy back higher, pay your broker.

      Sentiment: Strong Buy

    • I disagree with you dilution thesis. You have to look at enterprise value. Market capitalization minus cash. You are making an assumption in that the additional shares were worth nothing. That is a mistake, because shares can be repurchased for cash just as cash can be obtained from issuing shares. $7.50 from here is huge, and who knows what else can happen, a collaboration or merger. Who knows. You can have your opinion, that is fine. If it retraces, some I don't care. I am not giving govt. tax money from capital gains, so soon. If you sold, you have already lost on that front. I like long term cap gains. I do trade some stocks, but not for TSRX with a significant catalyst due in weeks.

      Sentiment: Strong Buy

      • 1 Reply to siamesekitty711
      • I completely understand the EV argument, but that's not perfect either since Trius will have a high cash burn and no generation of income, so ultimately the cash from the diluted shares will get spent. I expect a European partnership with hopefully 50 million upfront which will be nice, but Trius is also starting 2 more trials this year as well as advancing their gyrase program.

        I'm not a bear on Trius, but when you're staring at huge profits its smart to lock in your gains. I'm hoping for a retracement prior to results in which I can re-enter. There may also be a sell the news type of reaction with this data much like other biotechs and a possible run down. What's going to keep share price supported between now and FDA approval in 1st half of 2013?