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DoctoRx

 
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  • Deflation Now? If So, Cash Is No Longer Trash: Discussion And Implications
    Tue, Dec. 16 ED, EDV, GCC 30 Comments

    Summary

    • The U.S. may be slipping from disinflation to mild deflation.
    • This deflation may be largely "good" deflation.
    • Even if that's the case, implications for cash and equities may be profound.
  • Investing And Trading Implications Of The Great Oil Bust Of 2014: Time To Buy The Dip?
    Thu, Dec. 11 GBX, HP, LYB 37 Comments

    Summary

    • The ongoing price war in crude oil is a huge story with widespread ramifications for financial market participants.
    • I've been a long-time observer of and occasional investor in the energy sector, and an outspoken bear this year on oil prices.
    • My take on the oil patch is that this could be an epic bust with farther to go on the downside, but interesting trading and investment opportunities now exist.
  • Still Bullish On Bonds: Analysis And A Forecast
    Tue, Dec. 9 EDV, GCC, IEF 14 Comments

    Summary

    • Interest rates have been in a downtrend ever since the Fed announced the Taper a year ago.
    • The cessation of the Taper has been associated with pronounced deflationary events.
    • For the above and other reasons, my out-of-consensus bullish view on bonds continues.
    • This article summarizes new bullish evidence to support the case for high quality fixed-income investments, preferably Treasuries.
  • My Bearish Views On Oil Prices Prove Accurate: What Next?
    Thu, Dec. 4 DBC, GCC, SU 30 Comments

    Summary

    • Oil has appeared overpriced to me since April.
    • All that really has happened in my view is that oil has followed the trend of other commodities.
    • This article explores the evolution of this crash and reports on recent news that continues to support a cautious, though not necessarily bearish, attitude toward the oil patch.
  • Why A Merck Clinical Trial May Help Amgen And Regeneron Shares To Set Higher Highs
    Wed, Nov. 26 AMGN 20 Comments

    Summary

    • Last week, a major potential headwind turned into a tailwind for potential "PCSK9 inhibitor" blockbusters from Amgen and Regeneron/Sanofi.
    • The good news was that Merck's IMPROVE-IT cholesterol study supported the "LDL hypothesis" upon which these PCSK9 inhibitors rely.
    • I have an out-of-consensus bullish view on the probable profit potential from this new drug class, which is expected to come to market next year.
  • Regeneron Plunges In What Barron's Calls A Significant Disappointment: My Analysis
    Thu, Nov. 6 REGN 24 Comments

    Summary

    • Regeneron missed some analysts' expectations for sales and EPS, sparking a nearly 6% sell-off in the shares.
    • Barron's jumped on the bearish bandwagon.
    • Yet the bull case for Regeneron continues to strengthen, as this article discusses.
  • Is AbbVie's Bullishness On Its Hepatitis C Drugs Valid?
    Tue, Nov. 4 GILD 161 Comments

    Summary

    • AbbVie remains bullish on its prospects to compete with Gilead Sciences in treating hepatitis C, genotype 1.
    • This article reviews certain AbbVie clinical data and raises questions about whether its bullishness is well-founded.
    • My opinion is that Gilead appears to be well-positioned to dominate hepatitis C treatment for years to come.
  • United Therapeutics Sells Off On Good News - Why I Bought That Dip
    Thu, Oct. 30 UTHR 9 Comments

    Summary

    • United Therapeutics sold off from a high level after reporting a strong quarter that marginally missed consensus sales expectations.
    • More important is the good news that the company foreshadowed on its conference call.
    • UTHR is an unusually low P/E stock given its high historical growth rates and prospects for strong growth in the next few years.
  • Gilead Beats And (Sort Of) Raises, Stock Drops: What Gives?
    Wed, Oct. 29 GILD 54 Comments

    Summary

    • Gilead reported Q3 earnings, which were fine.
    • The stock sold off several percent after hours, though from near-record levels.
    • Between the earnings report and management's comments on the conference call, my bullish view of the company and the shares remains intact.
  • Amgen And Regeneron Reach All-Time Highs Together: Updates On Both Biotech Stalwarts
    Thu, Oct. 23 AMGN 11 Comments

    Summary

    • Amgen and Regeneron are the two companies that have filed for marketing approval for their drugs to lower cholesterol via the PCSK9 pathway.
    • Each company has numerous strengths.
    • Recent data have given additional force to the uptrends of their stocks.
  • A Review Of Gilead's Harvoni, And Competitive Considerations
    Wed, Oct. 15 GILD 76 Comments

    Summary

    • Last Friday, Gilead Sciences received FDA marketing approval for Harvoni, its two-drug combination product for hepatitis C genotype 1.
    • Harvoni is a breakthrough treatment for this serious disease.
    • Harvoni's Prescribing Information reveals that a course of treatment with Harvoni is safe, easy to comply with, and highly effective.
    • My view is that Harvoni plus Sovaldi is a formidable product line that will be difficult for AbbVie and others to compete against.
  • Why I'm Not Buying The Dip In Domestic Energy Stocks
    Wed, Oct. 15 TRN 24 Comments

    Summary

    • Oil has entered a bear market.
    • Speculators on the futures exchange have held to a strong bullish posture, however.
    • Domestic energy plays have taken big hits in the stock market, and right now I am standing clear of these stocks, even those of high quality companies.
  • Additional Bullish Portents For Treasuries
    Mon, Oct. 13 TLT 75 Comments

    Summary

    • Enough news has occurred in less than a week to document it in another article on Treasuries.
    • To me, this news provides accelerating positive arguments for lower Treasury rates, though this is not a day-to-day timing call.
    • All this is consistent with the Taper following the pattern set at the end of QE 1 and QE 2.
  • 'Bullish On Bonds' - An Update
    Thu, Oct. 9 TLT 18 Comments

    Summary

    • Treasury bonds may be well-positioned to rally further as QE ends, surprising consensus.
    • This would reprise their action after QE 1 and QE 2 ended.
    • Recent data affecting bonds is favorable as I see it.
    • This article updates my case for interest rate bullishness from late August.
  • Update: Portola Reports Positive Phase 3 Results And A Secondary Stock Offering
    Mon, Oct. 6 PTLA 4 Comments

    Summary

    • Two material events have moved shares of development-stage Portola in opposing directions.
    • First, the company reported strongly positive results in its first Phase 3 study of its anticoagulant reversal agent, andexanet - and the stocked jumped.
    • After announcing the good news, a secondary stock offering was announced, priced under the market price at the time - and the stock dropped (then popped).
    • The positive Phase 3 data was in line with my expectation expressed in my July article.
    • The equity raise was not previously addressed by me, but the need for additional capital should be no surprise, and I remain long this risky stock with patience.
  • The Importance Of TAF To Gilead
    Fri, Oct. 3 GILD 47 Comments

    Summary

    • Gilead reported positive Phase 3 results last week on its new version of tenofovir, an anti-viral agent for HIV and hepatitis B.
    • The results were better than expected, with my analysis a statistically-nonsignificant trend toward the new drug, TAF, being more effective than the existing version of tenofovir.
    • I expect that TAF will be a cornerstone of Gilead's efforts to sustain its dominance in the anti-HIV market for many years to come.
    • The success of TAF represents a rarity in Big Pharma, namely a life-cycle management version of a major drug that is an important improvement over the existing drug.
  • Gilead Update: Good News Keeps On Coming; Much Higher Share Prices Appear Justified
    Mon, Sep. 8 GILD 98 Comments

    Summary

    • Gilead is becoming an investment icon, and the stock has soared the past few years.
    • That puts a burden on the company to continue to provide upside surprises.
    • This article attempts to make the case that this is happening, and that Gilead's shares are still attractive.
  • Challenging Consensus On PCSK9 Inhibitors: Focus On Regeneron And Amgen
    Mon, Sep. 8 REGN 11 Comments

    Summary

    • Amgen has filed for approval the first of a new class of proteins to lower LDL cholesterol.
    • These PCSK9 inhibitors are expected to see Amgen's evolocumab and Regeneron/Sanofi's alirocumab reach market within a year.
    • Enough information has been released to allow preliminary analysis of the commercial potential of these drugs and the entire class.
    • One factor to consider is insider accumulation at Regeneron.
  • Why I Bought Into Monday's Move In Regeneron
    Tue, Aug. 26 REGN 30 Comments

    Summary

    • Regeneron has just announced a surprise data release on its main pipeline drug over the Labor Day weekend.
    • I speculate that the news will be favorable.
    • The stock is acting well and Regeneron has been doing well operationally.
    • Valuation may explain why there is a decent short position on the stock, but the shorts may be getting uncomfortable now.
  • The Taper Of QE, And Other Reasons To Be Bullish On Bonds
    Mon, Aug. 25 EDV, IEF, TLH 22 Comments

    Summary

    • Consensus is that the Fed's ending of QE takes away buying power from bonds and should therefore be accompanied by rising interest rates.
    • The history and practical aspects of QE do not support this view.
    • Other factors make me tend toward the bond-bullish camp, though unfortunately high real interest rates are absent, so this is a speculative position rather than a fundamentally-based one.
  • An Analysis Of Amgen
    Fri, Aug. 22 AMGN 24 Comments

    Summary

    • Amgen has a balanced mix of mature blockbusters, new products and a diverse pipeline.
    • Despite more than doubling in the past few years, its absolute and relative valuation metrics could increase further.
    • The turnaround in R&D and a new focus on marketing could allow it to grow profits rapidly in the next several years, giving the stock very large upside potential.
  • Gilead: Rising Short Interest Provides Yet Another Reason To Own The Stock
    Fri, Aug. 15 GILD 62 Comments

    Summary

    • Gilead Sciences is succeeding beyond the wildest dreams of its bulls as of only eight months ago.
    • Its forward P/E is low relative to the market, thus incorporating caution about the sustainability of profits from its hepatitis C franchise.
    • Yet the shorts have established a significant and growing position in the shares.
    • I take that fact to be yet another attractive feature of GILD shares, especially in view of the latest newsflow on Gilead.
  • Supernus Finding Success, Looks Undervalued
       • Fri, Aug. 15 SUPN 2 Comments

    Summary

    • Supernus is a niche pharmaceutical company that brought two products to market last year.
    • It announced an upside surprise this week.
    • An intelligent business plan allows investors more than one way for the stock to appreciate substantially.
  • United Therapeutics: A Low P/E Biotech With Potential For Further Rapid Growth
       • Tue, Aug. 12 UTHR 6 Comments

    Summary

    • United Therapeutics recently reported strong Q2 results.
    • Investors have worried about possible generic competition to its lead product, but the company argues it will likely lose little business should it come to pass.
    • A strong pipeline, debt-free finances, and experienced management make this 10X P/E company's stock interesting, with the launch of Orenitram providing upside potential.
    • The imminent freedom from paying a 10% royalty fee on its lead products adds to the upside potential in this stock.
    • Several risks are present, including a probe of UTHR's marketing by the Office of the Inspector General.
  • The Case That Regeneron May Be Significantly Undervalued
    Fri, Aug. 8 REGN 9 Comments

    Summary

    • Regeneron announced an upside surprise for sales of its lead product Eylea this week.
    • It has a powerful pipeline and important collaborations with Sanofi and Bayer HealthCare.
    • The combination of high R&D spending and elevated pre-launch expenses for its late-stage cholesterol reducer alirocumab means that P/E is the wrong metric investors should look at.
  • The Case That Our Investment Dollars Will Be Treated Well In Dollar Tree Stock
    Wed, Jul. 30 DLTR 5 Comments

    Summary

    • Dollar Tree has been a very successful company that has grown both by growth and acquisition.
    • It has announced a transformational deal, a merger with/acquisition of Family Dollar.
    • I view this deal as promising, especially in view of the two year consolidation in DLTR that has brought its P/E down from its 2012 peak.
  • A Re-Analysis Of Gilead After Q2 Results And The Early Idelalisib Approval
    Editors' Pick • Thu, Jul. 24 GILD 63 Comments

    Summary

    • Gilead Sciences announced Wednesday that it had another great quarter.
    • Sovaldi sales met all but the very most optimistic projections.
    • The rest of the company is also in gear.
    • A large short position and strong business prospects make Gilead a stock that I find to be very attractive, especially in a high-P/E market.
  • Biogen Idec Beats And Raises: Reassessing Its Prospects
    Wed, Jul. 23 BIIB 6 Comments

    Summary

    • Biogen Idec crushed sales and earnings estimates in Q2.
    • The stock has surged but remains off its highs of this winter.
    • With robust growth ahead and a leader in a secular growth field, Biogen Idec is, I believe, an attractive stock at current levels in the $330-$340 range.
  • Biotechs Have Their 'Irrational Exuberance' Moment: Time To Buy More?
    Mon, Jul. 21 ALXN, AMGN, BBH 22 Comments

    Summary

    • The Fed has now complained of overvaluation amongst smaller biotech stocks.
    • On this news, large cap biotechs were slammed as well.
    • This is reminiscent of Alan Greenspan's "irrational exuberance" comments in late 1996, a great buying opportunity.
  • Evaluating Biogen Idec After The Sell-Off
    Mon, Jul. 21 BIIB 6 Comments

    Summary

    • Biogen Idec sold off last week on Federal Reserve concerns about valuation in smaller biotechs.
    • This large company generates large amounts of cash, despite spending heavily on R&D.
    • This article explains why I look at Biogen Idec as a core holding within the biotech universe.
  • Buying Big Blue On A Clean Quarter And Record Q2 EPS
    Editors' Pick • Fri, Jul. 18 IBM 48 Comments

    Summary

    • IBM had a clean quarter, with a mild EPS beat and a sales beat.
    • It reiterated and possibly slightly upgraded guidance for the second half.
    • Several parts of its business may have bottomed, and the partnership with Apple may suggest new creative thinking at IBM.
    • The shares now look attractive to me, though a turnaround has not happened yet.
  • Taiwan Semiconductor Still Dominates; Buying The Sell-Off
    Thu, Jul. 17 TSM 36 Comments

    Summary

    • Taiwan Semiconductor sold off sharply after reporting a seemingly good quarter with good guidance for the rest of 2014.
    • Some current news regarding competition may have led to profit-taking following its strong stock performance the past several months.
    • This article reviews where I see TSM now and reiterates the bullish view of the stock I first propounded three months ago.