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Apologies, I didn’t know we needed formal PT reports to post to this message board. I don”t remember you posting that for all of the other PT indications on this board. I think we’ll be lucky to get to $5 B in sales and that would relate to $50/share for the reasons I stated in earlier post.
Meowza,
I wasn't intending to make it a business strategy. My post was to show just how unlikely we get to $200 share price. Using a valuation of 20 PE would mean $4 billion in profit. with a 20% net margin (by the way, very high) we would need $20 billion in sales. This without the company increasing their share count and the market giving us the full 20 PE knowing that our current 1 drug will be out of patent protection in the US in 8/9 years.
I believe in 2 years we can get to $5 billion in sales with 20% net margin which would be roughly $2.50/share by 20 PE or $50. For a buyout with a strategic buyer I think we can be bought next year in the 2nd or 3rd quarter for $40 - $50 and they can fold it into their operation with our drug being a complimentary offering with their current lineup.
$200 is cuckoo for cocoa pops
$200 / share divided by 20 PE = $10/share earnings multiplied by 400 million shares = $4 billion net profit X 20% net margin = $20 Billion in sales - all this with the US going out of patent protection (if we win the appeal) in 8/9 years? Again, cuckoo for cocoa pops
Does this mean we should be thanking Goldman for raising the funds for us instead of criticizing them for our stock price being $7/share?
Strikes me more as irrational market exuberance for these types of stocks than morality. Remember, they get a % of funds raised. Why would they want to make less?
The market can be irrational on some of these IPOs. No matter what multiples, valuations or valuation models are applied the market just goes crazy and bids the price significantly higher than it should be. Happened often back in 1999/2000.
How could any investment banker justify an $11 billion market cap with a company that has $20 million in sales. That is sales, not profits. I never would have been able to justify this even if I was working with the highest of moral motivations. What kind of discount rates and cash flows must this company achieve in order to justify a present value of $11 billion? Seems crazy to me.
Anyone else thinking cuckoo for cocoa pops here?
Most everyone I know that isn't clerical make between $300k to $750k. Not all, but I'd say 75%
Jas,
I guess I struggle in that you say that you don't know how they do it, but morals are not top of the list. I know plenty of people that work at some of the biggest name investment banks and most of them are very moral nice people that you would enjoy doing business with.
My question is where would AMRN be if Goldman (or another investment bank) hadn't assisted them in doing the secondary offering that raised about $600 million a year or 2 ago. Their $600 million in the bank would be close $0 and the companies future would be in jeopardy.
Have I met traders that would sell their mother for the right trade? Absolutely. Do investment banks charge dearly for their services and have good margins? Absolutely. However for our system of capitalism they are required to raise money and provide markets and liquidity. Look what happened to the liquidity in the bond market when laws changed and the investment banks wouldn't hold the big inventory they previously had.
In terms of selling puts and calls that is a very dangerous strategy unless they are covered in some way. What about the poor guy that wrote the uncovered TSLA calls for $1000 strike price when the stock was trading around $600. He probably thought he would pocket a nice premium but is on the hook for hundreds of $ per share multiplied by 100 shares if he only wrote 1 contract.
You can tell that the investment banks didn't know what was going to happen ahead of time because the stock price didn't have any unusual trading before Du Du's ruling. As far as the strategies they use they generally are well known. Take the CFA exam, which anyone can do, and you will learn the strategies as well. But options are a zero sum game played by lots of smart people and loads of leverage.
I just hate seeing a group vilified for some bad apples. Are all Europeans bad just because Spain had Franco? Attorneys told a rough ride on this site a while ago before many posters stood up for them.
I guess I'll end this ramble with "What is the definition of a Shame? A bus load of lawyers going off a cliff with an empty seat". Sorry attorneys, couldn't help myself
Jasbg
I understand market cap and know the lost value, I feel it in my own accounts. This $ would have gone to the shorts and put holders. I think someone like Goldman positions themselves to make money if it goes up or down from their transaction and advisory services.
Why did the $6 billion go to Goldman?
I definitely believe it’s possible, but not forever. Delaying responses to questions, waiting until the last acceptable time for anything AMRN has to do will delay. I previously thought there would be a 3rd quarter buyout after winning lawsuit and getting European approval. I now think it will be first half of next year and is main reason we still have GIA strategy. My guess February next year around $40/share
Nice place LB. I'm sitting at Lake Gaston right now. We chose lake over beach due to hurricanes
Why are you bothering this poor guy, he has a company to run.
You are also the least correct, least value added and clog the board more than anyone else. Like I said before, if you were a stopped clock you would be right once a day.
BB If you were a stopped clock you would find a way to be right only once a day
Great analysis
I asked this question once before and no one bit. Maybe it’s a stupid question.
If state law requires substitution of the lowest cost drug and pharmacies are substituting for the Reduce It indication can states be sued for causing infringement?
Is this a crazy thought?
I wonder if he was on generic or branded meth? Apologies ahead of time, sick sense of humor
I wonder if you can turn that into a Haiku?
I wonder if he thinks 3 inches is social distancing?
https://www.ncdhhs.gov/divisions/public-health/covid19/covid-19-nc-case-count
N.C. DHHS shows 399 deaths as latest. I’ve been isolating for 7 weeks
YNWA
Really, that’s your contribution. Read some of your TLRY posts. Never anything of value, always attacks. Go away.
If states have laws requiring lowest cost alternative be subbed and generics don’t have reduce it label, can states be sued for causing infringement when a generic is subbed for an indication protected by patent?
It would still make sense to refi if the interest rate differential was great enough. If you had a mortgage with $100k left and were paying $2k/month @ 5%. Refi to 3%, but keep paying $2k/month and you’ll probably pay the mortgage off in 5.5 years instead of the 7 remaining, saving 18 payments or $36k.
This is hypothetical as I don’t have my financial calculator with me to give you real numbers. I’m guessing my savings are overstated but you get the idea how it would work.
Pay the same $ amount of principal and interest and with the lower rate you’ll pay off the loan earlier and save interest expense.
I wonder if there is room for a settlement? We are still paying 10% of revenues against a note that helped get us through reduce it. Pay this to generics, reducing our gross margins to 70% which we can make up over time with some price increases. Generics can make same profits without the supply chain issues.
Oh shut up already, got it. So many opinions none of them ever correct
Massie asking for a recorded vote causing $200k in travel costs was stupid. I know it’s less than a rounding error on the size of this new bill but it is still a stupid waste
Best for your son. I have a son in the army too. Go army and all the vets on this board
I’m on the record for $60 +/- $10 by end of 3rd quarter assuming positive trial outcome
It’s all about present value of future cash flows with applicable discount rates.
The theory is easy, but it would be a complex forecast of sales growth, costs, impact of loss of exclusivity, not to mention determining the appropriate discount rate.
Potential for large margin of error.
I think if they are still GIA in 2024/5 they’ll have used some of their cash flow to purchase other compounds. JLs dream of them becoming a big pharma on their own.
In Dante’s lowest rings of hell the soothsayers had their heads twisted backwards because only god could tell the future. Not religious but I appreciate the thought
Most non-GAAP reporting does nowadays. Besides, I would expect the cumulative loss carry forward to be big enough to avoid taxes for quite some time, but this isn’t my specialty.
ABFC - I agree that the upgrade was helpful with BB selling, Fartstain being Fartstain, down market, But a small, at that time profitable, biotech with a 70 - 90% growth rate even 20 PE is conservative. The S&P 500 is at around 18 right now. PE of 12 is like a regulated utility
It is nice that he is positive.
If he expects $2.4 billion in sales with 80% gross margin = $1.92 billion contribution minus $750 million overhead = roughly $1.2 billion net. $3/share net x 20 PE = $60 SP.
That’s a far cry from the $24 he has as a target
Price targets are typically 12 months in the future, not current time
Thanks Lemm and Study
Thanks Kiwi
Yes it is Crestor and V combined with a recent assist from Peloton and a long term assist from red wine