It is every time so fascinating to listen to people talking about a "no earning" from Organovo (NYSEMKT:ONVO). While I slightly agree that the company was overpriced right after the ring bell celebration on NYSE - I am still convinced that the potential on the long term for this company is enormous.
Sure that all are in line with the above statement, I would like to analyze the current situation with the stock in order to know if Organovo is a buy!
Since its high to 8.5 few days ago, the stock has lost more than 20%.
- That was inevitable as far as most investors took their short profit, fearing a drop like in June 2012.
- Moreover the stock plunged one more time due to an article on July 24, 2013, from Seeking-Alpha author Richard Pearson published an article: Organovo: Red Hot But Set To Drop
It appeared that this article was highly inaccurate on some of the most important points.
Jason Napodano has written a complete article to clear up some confusion concerning this last article. Clearing up some confusion on Organovo
Since then, the stock hasn't recovered yet from its lost due to the above inaccurate article.
- On July 29, 2013, the three 3D Printer Companies (DDD, SSYS, XONE) have seen their stocks flying, because of high expectations concerning the Earning Report of 3D Systems.
During this time, Organovo, as a Biotechnology company didn't follow this trend and lost 1,75%.
On the next day, July 30, 2013, while 3D Systems plunged due to a disappointing quarterly Earning Report, the Organovo stock has, this time, followed the trend of the 3D stocks and plunged.
With this kind of technology and company's vision, I sincerely believe that this company has a high potential for growth on the short and long term.
Remember, we never invest in a company for what they have achieved, but for what they can/could/will/should achieve - Especially when we refer to a revolutionary and young Biotechnology company! That kind of company needs fund in order to achieve their projects - That is the main reason that they went public.
Organovo has a lot to offer in the (BATS:NEAR) future
Therefore from my point of view, it is hard to judge whether or not the stock price is expensive at this moment. What we can be sure, it is that they have a lot to offer in the future. From production of tissue for drugs testing to the possibility to 3D print organs - This, thanks to the partnerships with the big Pharma.
The stock price should reach a new high before the Annual Meeting of Stockholders scheduled for August 21, 2013. Personally convinced that we can expect a serious briefing concerning the strategy and objective as well as great news before or during this meeting.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.