I have read everyones comments. My big question is WHY?Why would Motley have such a positive outlook on a stock if it is performing like a dog???? Why would Motley have an active love for a stock when it CONTINUES TO UNDERPERFORM????????????? Although I am not a professional investor. I find trust in alot of what Motley has to offer me. Thefore I don't research behind them as I would a "partner" who "knows all". I don't want to bail, because I trust what they feel. Do I have trust in wrongful partners???????????????????????????????????????
Hey bradh21,Never fear the market will turn a budding biotech into a tossed salad in 2 months or 2 days. EXEL has a lot going for it. As I am sure you have read on the FOOL. There is no reason for the underperformance lately other than market conditions. I own some and I'll ya it's not fun watching it slide, but I know that I am in for the long haul.. Which you need to be for these type of investments.FoolishMage
First, keep in mind that the market is currently being hit by a correction. Most stocks, both good and bad, are being hammered right now. Under such circumstances, the TMF's analysts aren't going to abandon stock picks just because they're currently going down. Moreover, if they believe that their original positive analysis of any given stock still holds true, they will encourage subscribers to buy more shares now that they are cheaper!In the case of EXEL, we have a young biotech company with a promising pipeline of products undergoing FDA testing but no products currently on the market. EXEL, therefore, is still a very speculative play. Wild fluctuations in price should be expected, particularly during periods of "no news" regarding EXEL. During bear markets, stocks like this get hit particularly hard.Once one of its candidates makes it through FDA testing and is marketed, EXEL's price should rise more strongly and steadily with the success of its products. (If EXEL's drug candidates fail to make it through FDA testing, on the other hand, the stock price will sink.) To date, EXEL's candidates have been making steady progress through the early phases of FDA testing. The original TMF analysis of EXEL's potential continues to be valid and that's why you haven't seen the TMF's analysts turn negative on this stock. Hope this helps!folgore
I have read everyones comments. My big question is WHY?Why would Motley have such a positive outlook on a stock if it is performing like a dog???? Why would Motley have an active love for a stock when it CONTINUES TO UNDERPERFORM????????????? --- What do you mean underperform? Many of the companies in it's sector have been overpriced. When a market looks unstable, those sectors are crushed. I had a fair value price on EXEL close to 10 dollars or so. This model assumes that a majority of the drugs in the pipeline continue to move forward making the company profitable in about 2010. If you mean "UNDERPERFORM" - as in the price went down. Yes, then it's underperforming. The company has virturally no cash free of debt and no positive cash flow. You're buying into the patents, pipeline, and possible future profits!!! None of that has changed. You paid a certain price for the value behind the PP&P (patents, pipeline, and possible future profits). At this point, more money is getting pumped into energy, commodities, oil, and larger pharma firms such as undervalued JNJ and AMGN. The hope we EXEL shareholders have, is that 10 years from now, when it's a 8b-12b mkt cap, instead of under a one. We can all laugh about who paid 12 bucks and who paid 6. In other words, if we're right about the company, who made 10 times, and who made 20. The risk is, 3 or 4 of the drugs hit a major wall in trials, and funding starts to dry up from the larger companies that are partners. With a fair amount of debt, and no positive cash flow to service it. We're all taking a pretty big gamble by owning shares. This isn't an earth shattering trend. In fact, for this stock to REALLY be in my "buy range" it would have to fall below 6 or 7 dollars. I jumped the gun and hopped in at 8.75, since it was below my fair value price. I didn't know it would really ever hit my buy range. Especially if it gets good news through it's next batch of trials, which I expect to happen. If we experience a long term trend that favors big pharma, and neglects to appreciate biotech value. Then we sell our position in either JNJ for 95-110 bucks or maybe AMGN for 120, and we buy into a couple of biotechs to level off our portfolio. It's not worth looking into rebalancing after a few months slide though, IMHO.
Great reply, Leo!
And the crowd goes wild!!!
Nahhh, they're all out fishing today and swatting the black flies.
Oh my..... way to try and make other Fools jealous!!!I'd take on a fleet of black flies for a good hour of fishing!!!
hey, nice reply Leo :)i agree totally...to the original poster, and i mean this sincerly, if you are that nervous about investing in these types of companies, you should really look into mutual funds....investing in EXEL or any small cap biotech is not for the faint-of-heart...with that high reward possibility comes very high risk..
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