gary, I'm with you. Initial sales numbers shown yesterday show a slow start, but if you look at so many blockbuster drugs, they've started off very slow as well.
Whether to hold into an earnings report is a most difficult decision. The one reason I like holding AAL into the report, is that we've seen every airlines have a good report with strong guidence. No reason to think AAL won't as well . In other words, at least we likely can count out the secnerio of bad report. Then the question is, will a good report move the stock up ? Well I guess that all depends on how much you think they'll make, whether you think those earnings will continue, and what PE to attach.
My position is that AAL will make around $1.50 for the Dec qtr, and guide for continued strong earnings growth going forward in 2015. However lets say that all AAL does is continue to make $1.50/qtr in 2015. If we give them just a 12 PE, then the stock is worth $72 vs the $55 present price. Therefore with the assumption of a good report for the Dec qtr, I think the stock is a safe hold, and has 30% minimum upside potential.
Maybe shorts will be covering now ?
It will be interesting to see what the offering price will be. Whatever it is, that's the price the stock won't go below without real bad news IMO. Bashers here are either shills or foolish shorts. Why ? Because if Auryxia gets FDA approval for early stage renal disease patients with anemia, which would triple to quadruple the revenue potential, then the stock will be worth $40-$50+ IMO. KERX is in phase lll with that & may very well get FDA approval for that purpose by the end of 2015.
Investors in KERX are not just betting they break into the Cronic Kidney Disease market with the only drug in the world which both lowers phosphte levels & increases iron stores(one drug for both), but that they could potentially quadruple that patient market & quardruple revenues.
I will be very surprised if the offering price is les than $13.
Well I don't see a slowdown in 2015, in fact I see year over year growth, with EPS of around $2.85 coming vs aorund $2.35 for for 2014. Time will tell.
Here's what I found out. The gross margins overall have been around 20.5%, however they've increased overall slightly over the last 4 qtrs to a little over 21%. Now there is slight seasonality(based on 2014 quarters sequentially), with the Dec qtr being about .05% less then the Sept qtr, the Mar qtr being about 2.6% less in revenues than the Dec qtr(at least last year), and the June being about what the previouis Sept qtr was. Then the sequential Sept qtr is much greater then the June qtr- by 11% on revenues in 2014 vs June qtr 2014. The bottom line is, using a 21% margin(conservative as it's .05% less than the Sept qtr) for the Dec qtr, it should come in at $1.52+, then the Mar qtr should come in at $1.40+, then the June qtr at $1.62+, and the Sept qtr over $2, and the Dec qtr around $2.
All totaled, if 2015 plays out with the same trends as 2014, PLUS would make over $7 in EPS for the calender year. Tack on a historic 13-14 PE going forward, and it takes the stock to $95, and this is conservative, as margins might very well average more than 21%. Personally I believe the stock is easily worth $80+ right now, and if they continue to prove themselves, then $100+ later in the year.
Sandy, I know that sounds like good logic, however stocks often don't move on logic in the short term. I mean IF AAL makes the $8+ in EPS for 2015 that so many think(includiing myself), the stock is obviously worth $75+. However that doesn't mean it sholuld move there now, or even while oil is tanking. It's just not that easy. My advice after 15 years of this- Don't buy or sell a stock based on it's short term movement. Buy or sell a stock based on fundamentals & the valuation you give it ONLY- then stick to your guns. That's how so many hedge funds get us- they make you often think just the opposite of the reality.
Now they''re going at the pace of $6+ for 2015. In addition, the stock has averaged $58 or so for the last year and a half, while EPS has been around $1/qtr. They just posted $1.63 for the Sept qtr vs $1.06 for the year ago qtr. Seems like 60% year over year growth isn't worth anything ? I don't get this recent selloff.