Solskin
For anyone who has followed my work on Seeking Alpha, they will know that I am a fan of buying biotech stocks that have pulled back extensively after some bad news. To the point that they are trading at or
Arvinas: Yet Another Biotech Trading Below Net Cash, But It's Only A Mild Bull Case
Summary
- I favor biotech stocks trading below cash value after setbacks; Arvinas (ARVN) fits this description, dropping 25% on Thursday after ending two Phase 3 trials.
- ARVN's net cash per share is over $12, presenting a 70% upside from its current $7 stock price.
- ARVN's remaining pipeline holds minimal value; the investment thesis hinges on its substantial cash reserves and potential for activist shareholder intervention.
- Despite the substantial discount to cash, I rate ARVN only a mild buy due to its high burn rate and limited near-term pipeline upside.
I am a private investor based out of Toronto, Canada and I have been investing since 2003. After 8 years in Corporate Finance with a Canadian Telecom company I have decided to dedicate myself full-time to the capital markets. I write on Seeking Alpha to demonstrate my financial analysis and writing skills across a variety of industries and to take advantage of any story-based trading opportunity that may arise. My passion and greatest depth of knowledge is on Canadian small cap stocks and I consider my blog posts to be some of my best work. I am interested in any freelance opportunities that may arise outside of Seeking Alpha on Canadian or American listed stocks. Currently challenging myself to do a high volume of quality analysis.
Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, but may initiate a beneficial Long position through a purchase of the stock, or the purchase of call options or similar derivatives in ARVN over 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.
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