Biotech shares in the Nasdaq now trade at almost 50 times their earnings over the past year, compared with a price/earnings ratio of 27.5 for the overall Nasdaq Composite. Nasdaq biotech shares trade at 31.5 times their expected earnings over the next 12 months, above the 21 ratio for the overall Nasdaq market, according to FactSet Inc.
Interesting. RGEN now trades at well over 100 times their earnings for the past year and trades at well over 100 for expected earnings over the next 12 months.
Whoops, forgot. A forward looking PE of 30 applies to Biotech companies. RGEN is not a Biotech. RGEN is a medical supply company and everyone know that Medical Supply companies command a forward looking PE of over 1000.
I think the earnings per share for the 4th quarter might be higher due to the one million dollar infusion from Pfizer on December 31.
This amounts to an additional 3 cents a share. Last year RGEN received infusions of three million dollars from their drug platforms. This amounts to 10 cents a share. Without that money their EPS for 2014 would be about 20 cents.
RGEN's drug platform is likely finished. No more cash infusions. Nevertheless RGEN should earn about 30 cents a share in 2015.
There is a little cooking of the books. RGEN's European revenue is subject to full income taxes. RGEN's United States income benefits from past tax loses. More than likely RGEN is paying very little taxes on its USA income. If RGEN paid full taxes on their USA income, the earnings for RGEN would be reduced. The 20 or 30 cents per share earnings reported by RGEN may be a little rosier than they would be without the tax loss benefit.