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I would not be shocked it the BOD also invites Helen to pursue new opportunities in the coming months.
It does feel like a sector reversal.
Blackrock reports 13.8% stake. I'd wager that they paid a lot less than our CFO has for their shares.
I think this latest pullback is all just broad market weakness in the Biotech space so in that sense I'm not really stunned. We were here just a few short weeks ago. Once biotech comes back into favor we'll show some life but I've no idea when that will happen. In the meantime, we should hold the line hereabouts, which is where the bleeding stopped the last time.
As for the buyback plan, I have no confidence in the CFO's idea nor in her execution, so I'd not be surprised that she pulled the trigger at $41. She may have been the buyer who got to $41 in the first place. LMAO!
As usual, Helen left many questions unanswered and succeded in muddying the waters. I'm betting that the patents are issued, because she is giving extremely specific expiry dates. Patents are easier to obtain even on a theoretical basis, because the concept doesn't have to be approved for use by other regulatory bodies, e.g. FDA, with different jurisdictions.
As for the requirement for new trials, my gut is that there will be some such requirement but it may be streamlined, since the original product has a demonstrably safe track record. This is not more than a guess though.
What do you think about the "new" product and the IP extension? I didn't get to listen to Helen on that topic today just yet.
Is it a done deal, i.e. have the patents been issued already or are they saying that it's in the works?
If I read it correctly the PR says there is another deal completed but not yet identified and it is already included in the income estimates for 2022.
HALO's original 6/2021 PR on the ViiV partnership:
ViiV anti-HIV drug approved by FDA. I'm not sure if this is one of the targets they named in the recent deal with HALO.
https://www.prnewswire.com/news-releases/fda-approves-first-injectable-treatment-for-hiv-pre-exposure-prevention-301448538.html
No biotech and no M&A experience. They are clearly pulling in their horns with regard to buying another platform. This was made pretty evident by the use of the cash hoard to finance the second round of stock buy-backs just announced, and now confirmed by this new hire, IMHO.
I'm ok with that, as long as new deals keep coming and at a faster pace. I was worried that Helen would go off and overpay for some new venture, but that seems off the table right now. Stick to your knitting. This company hit $55 when the narrative was simple, i.e. that HALO was a cash generator.
Straightening out the IP worries and and removing the fear of HALO buying a new unknown technology should get us back on track.
And also maybe he can help Helen answer these persistent questions more clearly when they are put to her.
The new guy has intellectual property and licensing experience but no biotech or M&A experience, so it's hard to say. Since the issue of patent rolloffs is a constant refrain, maybe he can bring more expertise in that arena and help negotiate better deals going forward.
Is efga decision due today?
XBI yes, but HALO might be another story.
Personally I wouldn't think that the General Counsel would leave "for other opportunities" if something good was in the works.
I take this as a sign that we are still stagnating in regards to any significant deals for the foreseeable future. I hope that I am wrong.
Agree on all points. I'd add that this company needs a fundamental change in leadership. Right now it appears that the leader is the CFO and she's out of ideas.
I wish it was in the 70's now and I'd be a happy man.
But the chart shows exactly what the broader market thinks of these financial engineering moves. It's undeniable that the downhill slide started exactly when the first convertible refi was announced and I expect no substantial change with this new buyback plan.
It shows the company has no forward game plan and no strategic vision. If the buybacks were in conjunction with a broader comprehensive approach I'd be a little more neutral about them.
A steady string of partnerships, followed by an announcement of a dividend, that would be the key.
Ask yourself, what if they find a new technology in a small company that they want to buy and suddenly see they are short of cash to make it happen. They'll issue MORE shares again in exchange for cash. At this time, under these circumstances, it's just plain stupid to spend another half billion dollars on this nowhere buyback plan. All my humble opinion of course.
Keep to the facts and opinions and you'll be ok. The minute you make a personal attack the post gets taken down. Simple.
Agreed on both points, but with caveats.
Well over 90% of the OS is held by institutions and thus the float is small and prone to exaggerated moves, especially to the downside when selling is sometimes forced by margin calls or stop limits. (Buying is rarely forced, but in an index it would be to a degree.)
Rebalancing has had an effect from time to time, but not so much here since in a rebalance scenario selliing would normally be provoked by profit taking when the position in a portfolio gets over-sized and needs trimming. Not the case here obviously.
I do think and hope it was a pre-arranged deal with an appropriately cheap pps. We'll likely find out at the next conference call.
A very unimpressive response to the big announcement. No surprise there. CFO ain't fooling anybody except Helen and the BOD.
Interesting, thanks. Do you think it was wise to announce in advance? Seems like it just made the buybacks more expensive. Hopefully the price had already been established before the announcement.
@ ~$33 pershare this would be a repurchase of ~7 million shares. There are only a handful of institutions that hold enough shares to enter into such a transaction.
https://www.nasdaq.com/market-activity/stocks/halo/institutional-holdings
You may be right but the plain language interpretation of the PR sounds like they are making a deal to buy from one seller.
I wonder who the "institution" is that is the seller.
If Helen soon inks a couple of big partnerships then we'll be fine. If this
financial shell game is all they have in the tool box, then the stock price will continue the current ugly trajectory.
Ya gotta laugh....
The text of the PR:
HALOZYME ANNOUNCES $750 MILLION THREE-YEAR SHARE REPURCHASE PROGRAM
12/09/2021
- Company Plans to Purchase up to $250 Million Worth of Shares by the End of 2022 Starting with Entering into a $150 Million Accelerated Share Repurchase Program Transaction in the Coming Week -
- New Share Repurchase Authorization Follows Recent Completion of Three-year $550 Million Share Buyback -
SAN DIEGO, Dec. 9, 2021 /PRNewswire/ -- Halozyme Therapeutics, Inc. (NASDAQ: HALO) today announced that its Board of Directors has approved a new share repurchase program effective immediately, which authorizes the Company to purchase up to $750 million of the Company's outstanding common stock over the next three years. The Company plans to enter into an accelerated share repurchase (ASR) program transaction with a financial institution in the coming week, subject to market conditions. The Company plans to purchase up to $250 million worth of shares by the end of 2022, including the $150 million ASR, pending market conditions and other factors.
"Our second share repurchase authorization demonstrates Halozyme's commitment to a balanced capital allocation strategy that includes investing in our operations, capital return and potential M&A," said Dr. Helen Torley, president and chief executive officer. "We are pleased that our strong cash generation and balance sheet enables us to return capital to investors while maintaining our ability to invest in our future to sustainably grow our business."
This share repurchase program follows the recent completion of the Company's prior $550 million three-year share repurchase program, which was completed in less than two years.
The amount and timing of shares repurchased under the share repurchase program will be subject to a variety of factors including market conditions, other business considerations and applicable legal requirements. Repurchases may be commenced or suspended at any time or from time-to-time at the Company's discretion without prior notice. Repurchases may be made through both public market and private transactions. The Company plans to fund repurchases from its existing cash balance. The Company's Board of Directors will regularly review this capital return policy in connection with a balanced capital allocation strategy focused on funding growth.
I also believe the stock buybacks were a big mistake. The current round is complete and I hope they refrian from any further such mindlessness.
They are all forced to make assumptions about probabilites that are unknowable at this stage of the game, thus the wide array, IMHO.
On the other side of things, hopefully the tax loss selling is about over and we see a modest turnaround a 3 or 4 weeks into the new year. Looks like a bottom hereabouts unless our crack CFO comes up with another financial engineering trick. LOL!
I have no idea what the inderlined phrase means. Can someone interpret that?
Your estimates look reasonable, and as you say, maybe even a little optimistic. So by 2026 halfway to a $Billion. Where does the other half come from in Helen's estimation?
Personally I'm getting the nasty feeling that these PTs are issued so their clients can continue to lighten their positions.
Agreed and I wonder what the text of the recent analyst reports actually says about all of these concerns. At least two (Wells and JMP) have PTs at $58 and $55 respectively (per Benzinga). How do they address the rosy PT outlook in the face of these real uncertainties?
We all know the potential, the question is, where are the deals? We get one every other year when we should be getting one every other month.
Why is it a big deal? Seems just incremental to me but wondering how you
see it.
Best, -Fritz
Excellent point.
Wells Fargo maintains overweight lowers PT from $60-$58
Well, this might bring some interest. Good find.
I don't listen to anonymous seeking alpha authors over what Helen has said on numerous public forums, and she is decidedly less sanguine about the patent rolloffs and the prospect for extensions. At best we gat a "maybe" from her.
Also, while she may be right about the trajectory to 2027, what happens after that? That is the question. The answer is, at least for now: nobody knows.
IMHO the problem is exactly that the fundamentals which you speak of are not sustainable without more evidence of momentum in striking new colaborative deals. Patent rolloffs are looming and will strike hard at the
current sources of profits. Helen is continually asked to address this every time she speaks and only offers vague assurances at best.