I sold in the premarket, reasoning that the retail shorts would be eager to take their profits. I was surprised that I got about 3.56. They must have nice furniture.
I also trade within my IRA and, since you can sell without worrying about the tax consequences, find I often sell too soon. Conversely, in my taxable accounts, I often hold onto a winning position too long and harvest losses too quickly. Of course, the ultimate position is a winning one which will appreciate taxfree for years and that you hold until you croak. Actually, I usually find I do better in my wife's account, which I naturally pay less attention to. Sometimes we overthink things.
A website I use for this stuff (and will not name to avoid being deleted as SPAM) shows heavy shorting action in the first two days of last week, tapering off sharply on the final three days. My calculations put 4/15 shares short at 38% of the float, so I'd estimate no more than 42% now. Still, this is astonishing in face of the fact that two directors, Pfizer, and two funds hold over 9.6 million shares and Institutional holders and mutual funds hold about 13 million shares...which would total a lot more than the float (in fact, virtually all of the shares outstanding). In any case, the ownership is so concentrated that they could easily shut down shorts if they wanted. So I conclude that a lot of the shorting is merely hedging on the part of these major holders. If the results are encouraging, the retail speculators who are riding their coattails could get badly hurt very quickly.
In the case of smaller, more speculative pharmas particularly, I have a different view: As long as the potential for a major advance is there, sideways movement - or even a loss - is acceptable to me. (up to a point - if the stock falls because their basic premise turns out to be mistaken, I take my loss and bail) Since I am seeking long term capital gains, I view 9 months of relatively flat performance as adding value: I am now within 3 months of a time when the stock can appreciate with much more favorable tax consequences. Since I have already taken my gains on GILD, I am dabbling in trading it now. But after the May options expire, I can see taking a new long term position.
Cordari is fickle. He was chasing that short up, and on Wednesday he was anticipating it going under 100. Thursday he was planning to wait until Monday to go long again. Then today he changed his mind and decided not to close his short today. I think that was a mistake, since to my mind, it's unlikely to go below this level next week. I put a buy order in at 103.82 today and went to lunch. I would have been very surprised if it didn't fill. I will probably add some more next week, thinking it will advance above 107.50 ahead of earnings. I will definitely sell at least half before earnings, but am undecided whether to bail completely. I think the huge imbalance in May options is a problem and will make it very difficult to hold above 103 as May 15'th approaches. After that, it may be safe to go back in the water, but I would still see no reason at this point to make GILD a keystone of a portfolio.
(Continued) the Medicaid and CHIP expansion, as well as the ACA (Obamacare), which haven't exactly been a bad thing for the pharma industry. (If you don't believe this, wait until you see what happens to the IBB if the Supreme Court limits Obamacare.) And, as a result of this, he has always garnered major campaign contributions from various medical and hospital interest groups. (A particular friend has been the American Podiatric Association - maybe he is on the take from Doctor Scholl) Now, of course, he has announced his retirement and doesn't need all those pharma campaign contributions. He is obviously planning on a new career as a lobbyist/consultant for the HMO and PBM lobby and is positioning himself as The Consumer's Friend.
Henry Waxman was the best friend the pharma industry ever had. First of all, he was the principal author and sponsor of the Orphan Drug Act, which essentially said that if you came up with a medication for an oddball disease, the government had to pay for it. Without Waxman, no BioMarin, no Celgene, etc. Second of all, he and Orrin Hatch produced the Waxman-Hatch Generic Drug Act which, while it seemed to rationalize the approval of generic drugs, actually provided the manufacturers with much greater patent protection. He was also the principal author and sponsor of the Ryan CARE Act, which guaranteed that the government would pay for HIV treatment. Without this, there would be no Gilead as we know it. Finally, he was a major backer of
If O'Neill has even a shred of self-respect ,I would expect him to offer a rebuttal. Waiting.
I am guessing that his will languish here, but will put the 110's in play next week. Which would take this up to the 107.50 -108 area. I will buy some at the close on Friday. I really like this company and would make a more serious commitment after the expiration of the May options.
Since O'Neill's recommendations are producing a - 72% return at this point, this suggests that if you were to put $10,140 in CLDN here, there is the possibility that this might become $36,140. which would recoup all the losses created by following O'Neill.
In the interest of fairness, pointing out that he was not 100% wrong, but only 90% wrong. Which, in this game, is wrong enough to make you broke,
Let's summarize this: If you had bought 1,000 shares of each of the stocks which O'Neill recommended at the time he recommended them, you would have invested $36,140 and lost $26,600. Leaving you with $10,140. During a time when the IBB doubled. What a guru.
Hmm. Incoherent supporters. My point was that this guy has been consistently wrong. Picking a biotech stock had been like shooting fish in a barrel. O'Neill has managed to miss the barrel. By my rough calculation, if you had invested money in the IBB when he had first begun to offer recommendations, you would have doubled your investment. If you had followed his recommendations, you would have lost more than half of your investment.
I don't mean to suggest that Blair O'Neill is unqualified to evaluate biotech stocks. In his Seeking Alpha profile he says, "Currently pursuing a Computing Engineering degree, but I enjoy the constant learning that comes with investing in biotech companies."
No, the only point of posting on Seeking Alpha is to garner clicks. Ergo, you post about the most volatile stocks. Blair isn't a hatchet man. He's just inept.
After a long hiatus, in which he no doubt contemplated his inability to find a single biotech gem in 2013/14 ( a bit like being at Sutter's Mill in 1848 and coming home with pockets full of gravel), O'Neill returns to the list:
7. 3/15/15. OTIC ("A Targeted Marketing Opportunity") Recommended @ 37.61. Targeted like Pearl Harbor (a 25% loss in a single month).. Closed today @32.83.
8. Finally, in the interest of fairness, we have to note ...
8/08/13. RMTI. Recommended @ 5. Closed today @ 10.82. Over this period, the IBB advanced from 193 to 363. So the fact that O'Neill was able to find one stock out of 8 which kept pace with the sector averages is proof of The Blind Squirrel Theorem.
In O'Neill's defense, he has probably figured out that if you are going to post on SA, where you get a few pennies for everyone who clicks on your post, you do better to post about a contentious stock, like CLDN. However, based on his track record, the odds are that, once again, he is dead wrong.
First of all, it's important to understand that there are no qualifications for posting on Seeking Alpha. If you doubt this, you might examine the remarkable record compiled by Blair O'Neill, the Wrong Way Corrigan of Biotech. He has posted 10 articles on Seeking Alpha, the first on 8/15/13; and in spite of the fact that the biotech index has doubled since that time, he has been putting up goose eggs. His record:
1. 8/15/13. GTX ("A Catalyst Play with Strong Leadership and Future Potential") Recommended @ 4.50. Future potential still unrealized. Closed today @ .73.
2. 8/22/13. SSH. ("A Sleeping Giant") Recommended @12. Apparently still sleeping. Closed today @ 4.18.
3. 9/27/13. ANTH. ("A Promising Future") Recommended @ 4.10. Promise still unfulfilled. During a period when biotech doubles, this one manages to limp up to 4.79. You are thinking, "well he wasn't completely wrong" in which case you missed ...
4.10/31/13. He turns negative on ANTH ("Recent Developments: Both Good and Bad") @ 3.35.
5. 10/23/13. AMRN. ("An Oversold Investment Opportunity") Recommended @ 6.37. Apparently more oversold than ever. Closed today @ 2.34.
6. 10/29/14. APPY. ("Huge Market Potential") Recommended @1.41. Closed today @ .56.