BioDelivery Sciences Requires Strong Investor Confidence

Shares of BioDelivery Sciences (BDSI) put a halt to the stock's current downtrend on Monday, closing at $4.79 after closing last week at $4.24. Early trading on Tuesday saw the stock trading relatively flat, aside from an early morning when BDSI spiked to nearly five dollars.

Monday's spike, in my opinion, could have been due to anticipation by investors of possible significant news (partnership) being released on Tuesday morning, just before Dr. Mark A. Sirgo was scheduled to present at the 2009 Maxim Group Growth Conference.

Since no news was announced on Tuesday morning, BDSI continued to trade for under five dollars - a price that I believe is a great buy for this stock because of reasons that I've outlined here.

If you're still under water with BDSI, continue to average down; that doesn't always mean waiting on the sidelines to see how low it will go - because Monday showed us that a reversal could come quick - but buy in increments for below the price at which you may be averaged in and watch as your cost average drop.

The way I play it when I'm trying to average down is I'll buy more and more shares as the price drops. That will quickly lower your cost average, but you must be very confident in your Due Diligence to stomach that strategy sometimes. For instance, it took quite a few Rolaids to soothe my stomach while buying CSUH for under five cents, but I was confident in my due diligence that told me that that company was on to a new genre being created in our country.

That one paid off and I believe that BDSI will also.

Disclosure: VFC is long BDSI.

Comments

[gino:]

I don't agree with your reasons why BDSI stock traded down. Elliott associates, a $10B NY hedge fund, started selling out their entire position on June15th. They sold close to 1.5M shares through various funds before the FDA gave it decision. When the FDA approved the drug and spiked up to $7.25 they sold off the rest of their entire position over the following few weeks. They filed with the SEC that they do not own any more shares of the stock but they do still own 1.9M warrants. If you google BDSI along with Elliott you will see they tried to remove the management of BDSI two years ago and were not successful. I have to believe there was some disagreements between them and BDSI. Either way, IF they did not sell out of their position and were still long BDSI stock could have been north of $10.00 right now. I think they broke the stock down and scared everyone out. The reality is they GOT the approval which validates the BEMA technology and sets them up for sucess with future BEMA products. I think this is one of the most undervalued pharmaceuticals companies on the street. When the rest of wall street wakes up to what really drove the stock down and recognizes the opportunity it will be already to late.

Sep 30 11:53 AM

[aflitzy:]

Gino, thank you for your comments - very informative.
Question:
Do you know why Elliott tried to remove management 2 years ago???
This may sound really dumb, but seems like very bad timing for Elliott to sell BDSI unless they had a short postion they needed to unwind prior to approval. Or were they convinced of non approval and wanted to get out fast.

Thanks


On Sep 30 11:53 AM gino wrote:

> I don't agree with your reasons why BDSI stock traded down. Elliott
> associates, a $10B NY hedge fund, started selling out their entire
> position on June15th. They sold close to 1.5M shares through various
> funds before the FDA gave it decision. When the FDA approved the
> drug and spiked up to $7.25 they sold off the rest of their entire
> position over the following few weeks. They filed with the SEC that
> they do not own any more shares of the stock but they do still own
> 1.9M warrants. If you google BDSI along with Elliott you will see
> they tried to remove the management of BDSI two years ago and were
> not successful. I have to believe there was some disagreements between
> them and BDSI. Either way, IF they did not sell out of their position
> and were still long BDSI stock could have been north of $10.00 right
> now. I think they broke the stock down and scared everyone out. The
> reality is they GOT the approval which validates the BEMA technology
> and sets them up for sucess with future BEMA products. I think this
> is one of the most undervalued pharmaceuticals companies on the street.
> When the rest of wall street wakes up to what really drove the stock
> down and recognizes the opportunity it will be already to late.

Oct 01 10:01 AM

[meridian575:]

Yahoo finance has an article about Biotech and Pharmaceutical Real Estates that should be of use for anyone in that sector. Here is the link:
finance.yahoo.com/news...

Oct 01 01:37 PM

[gino:]

Here is what i found. triangle.bizjournals.c...

When Elliott reported this on Aug 4th.www.sec.gov/Archives/e...

They still have 1.9M warrants. Not sure were there priced though. Either way, you can see why the stock dropped.


On Oct 01 10:01 AM aflitzy wrote:

> Gino, thank you for your comments - very informative.
> Question:
> Do you know why Elliott tried to remove management 2 years ago???
>
> This may sound really dumb, but seems like very bad timing for Elliott
> to sell BDSI unless they had a short postion they needed to unwind
> prior to approval. Or were they convinced of non approval and wanted
> to get out fast.
>
> Thanks

Oct 01 11:01 PM

[littlefrog:]

HI VFC:

I have been following BDSI for a few month and today they announced application of New Drug in Canada for Onsolis which seems had no positive impact on share price so far.
so what's your take for the Oct launch of Onsolis on U.S market? will it boost the price given a common company PR.

Oct 02 02:33 PM

[theparty:]

Hi VFC,

I really like the performance of BDSI for the pass few days. Charts start to build up.

Thoughts?

Thanks.

Oct 02 04:26 PM