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5 Potential Pandemic Shorts
I agree with your premise that the recent swine flu hype has created some viable shorting opportunities. NVAX and BCRX shares have skyrocketed to multiples of last week’s pre-hoopla prices on sheer speculation that they may reap some swine flu-related benefits.
On the other hand, I find your choice of CRXL and GILD as potential shorting candidates due to the swine flu panic baffling. Both of these are established, profitable companies that have had steady high growth in revenue and earnings over the past 5 years. GILD has had no price run-up since the panic began, on normal volume. CRXL shares have risen around 10% since late last week; some of the appreciation may well be thanks to the swine flu situation, but since hitting 5-year lows in October 2008, CRXL has climbed steadily, gaining ~125%. Neither GILD’s nor CRXL’s fortunes rests on the swine flu pandemic. If anything, I could argue that they have far more to gain than lose no matter how the situation plays out.
Apr 29, 2009. 08:20 PM
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