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  • A Strange Situation At Retrophin Becomes Even More Bizarre [View article]
    I want to thank the author for the article. It helped me buy shares at low prices. Keep them coming.
    Mar 19, 2015. 11:06 AM | 1 Like Like |Link to Comment
  • MannKind Investors: Don't Screw Up The Afrezza Launch [View article]
    This one comment is 10 times better than the article. Kudos to Afrezzauser.
    Feb 12, 2015. 08:44 AM | Likes Like |Link to Comment
  • LendingClub: Overvalued And Not Disruptive [View article]
    I bought a 200 shares tracking position and still researching this stock. Pardon my ignorance.

    1) Valuation: A new business model that doesn't take credit risk, operates a platform and grows crazy will see high valuation. The market prices in larger values down the road. Of 9BB, maybe some 8BB is for NPV values of cash flows in years 2020+. In some sense, LC is both cheap and expensive. If growth sustains, it is a cheap stock. THe author could have made the same argument about AMZN 10+ years back (I made the same mistake too and passed on AMZN). You would be hard pressed to justify valuing AMZN at 100 times revenue multiple 10 years back. Companies can grow into their valuations in short time.

    Is LC another AMZN? no one can tell and no one knows. Stocks like LC will show violent moves up and down.

    2) If properly executed, this sector (LC) is a winner takes all. No one can complete against EBAY in US. why? EBAY has network effects. each buyer and seller acts as a magnet and once you've a giant ball of magnets, any smaller ones will get attracted to this big ball. In LC, once you've a bigger pool of borrowers and lenders, any new borrowers/lenders will gravitate towards LC. That is the moat.

    3) The biz will eventually have high ROE, look at S1, most of expenses are in sales and marketing. New entrants cant match their spending to gain reach. So winner gets bigger and bigger at expense of new entrants. They'll have huge operating leverage.

    4) LC's competition now is not other p2p for now. It is brick and mortar. they are the big fat prey. LC and p2p offer economic value to both lender and borrower.

    5) The platform is global (dont know if its now). A Chinese saver can fund US debtor. Is this not disruptive?

    Yes, LC is expensive now, but if growth sustains, it is cheap.
    Dec 23, 2014. 02:55 PM | 3 Likes Like |Link to Comment
  • Best Idea For 2014: Sanofi Rights Post-FDA Approval [View article]
    Mr Mushman

    Regarding "The likelihood is that they won't make the milestone no matter how hard they try. There is a 400mm bonus if they fail. They currently trade at about a 25 PE which means that a 400mm ding to the bottom line - all that milestone money will be a current expense - theoretically translates into 10 billion in market cap."

    Here is the flaw. The 400mm is one time, not a perpetual savings. If you have a business that throws off 400mm every year, then you can apply a 25PE multiple and value it at 10BB. A onetime savings of 400mm never translates to 10BB market cap.

    So much for the beginner comment insult to a fellow poster.
    Dec 4, 2014. 10:35 AM | 4 Likes Like |Link to Comment
  • Best Idea For 2014: Sanofi Rights Post-FDA Approval [View article]
    This is what scares me; look at the slow but exponential ramp up

    US sales

    2005 - 11MM
    2006 - 28.2MM
    2007 - 217.4
    2008 - 421.6MM

    pg 40
    Nov 29, 2014. 09:34 AM | 4 Likes Like |Link to Comment
  • Best Idea For 2014: Sanofi Rights Post-FDA Approval [View article]
    Also Manoj pointed to insurance costs. Not every insurer will add this drug to their Rx list on Day 1. This takes time and time is of essence in meeting the sales target. I can think of many more hurdles.

    BTW, I've done enough reading to convince myself that this is a superior drug (a cure) compared to others. That doesn't translate itself to hitting sales milestones in narrow intervals of time.
    Nov 27, 2014. 12:06 PM | 4 Likes Like |Link to Comment
  • Best Idea For 2014: Sanofi Rights Post-FDA Approval [View article]

    Good article.
    Let me be your devil's advocate:

    1) If you think of 400K patients who take the MS train, Lemtrada can't sell them anything when they board it. Bulk of passengers continue to travel in this train without getting offboard. Lemtrada can only target those who get off the train in coming stops. Even in subsequent stops, there are other competing drugs. So what is the real percentage of people who are looking for a new treatment in a 12 month time frame? That is the true patient population. ALso a portion will be turned off by the perceived side effects.

    2) If you read the REMS, from line 177, you'll notice that not any doc can prescribe Lemtrada.

    3) The facilities should also be authorized, trained to adminster the infusion. Remember the infusion reaction is 92%.

    2 & 3 are going to limit the access and in turn potential sales.

    4) Any greatest selling drug when introduced in a crowded market takes a while to gain foothold. Your comparison with Tysabri's 1.6B sales is specious. Tysabri took several years for sales to ramp up. It had very low sales in initial years. I strongly believe that Lemtrada if IL-21 marker is found will hit 2BB sales, may be in 2018, but unlikely in 2015.

    without IL-21 marker you can forget about miilestones 2-4. It is <5% probability event.

    5) The only thing of value is $400MM. Now lets assume they get 100MM in ROW (not a 100% prob event). US should produce 300MM sales in 1 year. They need 3000 patients, which is doable but no easy task. Remember the challenges in 1-3 above.

    To get this patient, everything should go right, the marketing, targeting, training, etc. We know almost all companies goof up initially, learn from mistakes and get them right. Genzyme will prove no exception to this rule. You got only 1 year.

    To me,this should be priced at 1.2. So you've a little bit discount. I think $400MM is not a done deal and market is pricing in the lack of confidence.

    Last but not the least, your earlier optimistic predictions have been proved to be far fetched. (ok , this is for speculators who go wide eyed reading this article).
    Nov 27, 2014. 11:59 AM | 8 Likes Like |Link to Comment
  • GCVRZ Forum [View instapost]
    Exited 95% of position as I've other attractive non-binary event stocks to buy. bought 30% of it a year back and rest few months back. what a ride!!
    Nov 17, 2014. 09:51 AM | 1 Like Like |Link to Comment
  • GCVRZ Forum [View instapost]
    Back to basics:

    I expect the payment #1 to be high probability event (almost 95%). Applying a discounting of 15% for 2 years, and .95% chance, you get $1.43. This is assigning zero value to other payments. It might settle around $1.75.
    Nov 15, 2014. 04:20 PM | 1 Like Like |Link to Comment
  • GCVRZ Forum [View instapost]
    Chris & contributors to this forum

    It was a long ride and there were times I thought it would never get approved.

    I want to thank all posters in this forum who helped me understand this drug better. Luckily I sold only half in the run up and kept the rest, hoping against hope.

    This is a victory for the patients in USA.

    Thanks to Chris in particular for helping us keep the faith. Good luck to you all.

    Take care
    Nov 15, 2014. 08:36 AM | 2 Likes Like |Link to Comment
  • A Better Valuation Metric Than Shiller CAPE [View article]
    I found something interesting on the data. The payout ratio now is 36.2%. It is at near historic lows. The last 100+ year average has been 61.68%. The S&P companies have shown an increasing preference for M&A, buy back than dividends.

    If historic dividend payout ratio was used, then dividends have to roughly double from the current one. This would make stocks look even cheaper. The concept is that , higher retention causes more growth and higher growth justifies higher P/E. This might explain some discrepancy between Shiller CAPE and my div/treasury yield.
    Nov 10, 2014. 02:19 PM | Likes Like |Link to Comment
  • A Better Valuation Metric Than Shiller CAPE [View article]
    What I've observed is that market valuation measures do not have any predictive powers. If the market was overvalued in 1997, it was even more overvalued in 1998.. and reached a peak in 2000. There were many who stayed out of the market or worse shorted and lost tons of money.

    The only thing that has some predictive power is yield curve inversion. Read some of my older articles on this.

    If market is a balloon, then investors don't have the pin to prick it. The fed that controls the inflow and outflow of air. During outflow, it just bursts.
    Nov 7, 2014. 02:09 PM | Likes Like |Link to Comment
  • A Better Valuation Metric Than Shiller CAPE [View article]
    Feel free to visit my dashboard for real time graphs & analysis
    Nov 6, 2014. 03:06 PM | Likes Like |Link to Comment
  • Why The Shiller P/E Is Useless [View article]
    Yes absolutely right, Fed is always slow. I collect over 200+ indicators that foretell recession (after analyzing several thousands), and hope to add to my website soon. Still a work in progress.

    Note that this "too low" unemp rate reflects itself as wage inflation. I added a financial conditions link today that is interesting to keep an eye on.

    Also click on "market valuations"
    Nov 4, 2014. 12:57 PM | Likes Like |Link to Comment
  • Why The Shiller P/E Is Useless [View article]
    I beg to differ.
    1) Unemp rate fluctuates with economic activity.
    2) Fed uses Unemp rate as one of its mandate
    3) To keep unemp steady, they try to reduce difference between actual unemp rate and natural rate of unemp (the slack)
    4) Fed uses short term rate as leverage to reduce slack (which also shows up in yield curve inversion)

    This slack measurement has great predicting power to know what the fed is going to do next. I've put some effort to predict recessions in my website
    Nov 4, 2014. 11:47 AM | Likes Like |Link to Comment