Clearly the sector did not turn the corner after the presidential debate even though it should have assuaged concerns over the importance of drug pricing to the candidates. The sector had a small recovery and with the positive news released last night, this should have been a nice tailwind. Any sort of early pop has […]
Dave Trading – October Edition – Bargain Hunting Time?
*** David Sobek is a disciplined value investor. Using models, research, and fundamental data, David devises a value for biotech stocks, buys when significantly undervalued, and sells when significantly overvalued.*** As a reminder, this is my personal guide. You can alter it in accordance with your risk tolerance. >3 Standard deviations – No position 2-3 […]
October 12 Biotech Update
It looks like fears are starting to take hold in the sector. I suspect it is centered on revenues coming up short and this then causes everyone to focus on the bad news that hits the tape. As I said before, I do think earnings will be weak for some large caps and this will […]
October 4 Biotech Update
Today is certainly a better start. It seems that the sector is trading to a certain extent on macro issues with the DB concerns leading to risk on versus risk off action. The sector will always be a victim to large risk off moves, so if the DB situation resolves I would not be surprised […]
September 28 Biotech Update
The sector continues to do well but there seems to be a bifurcation occurring where the SMID are outperforming the large caps. Usually when investors come back into a sector they start higher on the capital scale as those are typically cash flow positive, reasonable valuations, and a safer way to increase exposure. This does […]
September 23 Biotech Update
The sector seems to be quieting down a little and perhaps a little bit of consolidation of the recent move is in the cards. All in all, however, it seems like a productive week for the sector and confirms my base case that the likely path moving forward is higher (with the obvious pullbacks sprinkle […]
September 16 Biotech Update
The rollercoaster ride continues but generally the sector has been an outperformer and even if there are occasional setbacks I expect that to continue. I take it as a positive sign that the Clinton discussion of pricing did not break us to new lows (we are probably far enough away that we can have confidence […]
August 3 Biotech Update
It is more of the same but we had a nice late day rumor yesterday that triggered a reversal higher. Outside of that rumor not much in the way of news. While these rumors tend to be a nice source of intraday moves, these are generally not sustainable as even if they are true, the […]
August 1 Biotech Update
Biotech is hot again. I know I may have just jinxed us but the sector continues to power higher even as the broader market spins its wheels. Obviously there will be pauses and consolidations but I suspect that the money flow that hurt us for so long is reversing and is now going to start […]
July 28 Biotech Update
It is a mixed bag today in terms of stock reactions but the actual numbers continue to be good. I am not exactly sure why some stocks are reacting better than others but I will take a stab at it. In any case, it is hard to argue that the fundamentals of the sector do […]
July 25 Biotech Update
It is a slow start to what will end up being a very busy week of large cap earnings. We have a large cap reporting every day and it will be started with GILD after the bell. We have had good price action so far that has correlated with a strong set of earnings. Of […]
July 21 Biotech Update
Finally we get some news for the sector and it is good news. Yesterday was a good day and the news so far today only builds on that move. Perhaps this is going to be enough to break the sector out of its range but that remains to be seen. At the very least it […]
July 20 Biotech Update
So the sector might actually be outperforming the market today but it is early. What is nice is that the positive news continues to be rewarded, which means our holdings only need to follow through on their catalysts to get a nice return. This is very different than earlier in the year where positive news […]
July 14 Biotech Update
The market continues to ramp higher but about halfway through yesterday the bottom fell out of the biotech sector and it has been struggling ever since despite the strength in the broader markets. It is not immediately clear what was the cause (seems temporally to correlate with Andrew Left noting that he is short VRX […]
June 22 Biotech Update
This is an extra early morning edition (I had to drop my kid off at the airport at 3:45AM) but really nothing a lot has changed since yesterday. The sector continues to be weak and there are some signs of large and important stocks breaking support but as a sector I think we are holding […]
June 21 Biotech Update
Really not much news but the more things change the more they stay the same. We seem destined to once again test the lows in the sector and one has to worry about each test. On the positive side the support keeps holding but on the negative side each test probably increases the risk of […]
June 7 Biotech Update
Today is going to be a real test of the sector with all the negative news that came out. I am sure some will try to call this the ASCO hangover but any selling today has little to do with ASCO. The sector has had a good run and I would not be surprised to […]
May 16 Biotech Update
We got some decent news flow to start the week both positive and negative. Who knows how that will balance out in terms of the sector general performance but this should be a week driven by news related moves with ASCO abstracts and the ABBV IPR decision still on deck. 1. The biggest data news […]
May 5 Biotech Update
We saw more of the same selling yesterday. It was across the market but it certainly felt like the sector led to the downside and failed to bounce when the market came back a little. Today is off to a better start but at this point I am not sure anyone thinks it will stick […]
May the 4th Be With You Biotech Update
It has certainly not been a good start to the week for the sector or really the market, although it seems like the sector is underperforming. As frustrating as it is after all of the under-performance, we cannot miss the forest for the trees and note that we are still not close to the recent […]
