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I was thinking the same thing, but also it could be a harbinger of a new deal in the works, so stay tuned.
Good luck!
-Fritz
If my math is right this will end up creating an additional 9 million shares (in round numbers) assuming the full offering is taken up.
Thanks to all for a great and level-headed discussion on this recent financing, a surprising and somewhat complicated turn of events. Collectively you have advanced my understanding a great deal.
Good luck!
-Fritz
Geez! why did they go back to the well so soon after the last financing? I'm rather surprised to say the least.
So, the decision not to convene an Ad Com meeting in this context can be construed as an unambiguous positive development?
Are advisory committee meetings reserved only for problematic applications? Heretofore I thought that they were SOP.
I think it's more that the market is rotating back into biotech (IBB and XBI are up big today) and that the upgrade was a bit of fuel to the fire.
BTW wasn't it Piper Jaffray before?
I hadn't heard about the name change to Piper Sandler.
New 52 week high this morning. Nice.
I like to sell calls against my trading shares and will likely do so again at the right moment.
Piper Sandler raises price target to $27.
Genius aside, I would not sleep well at night letting Musk have his way with my extremely hard-earned money. I watch with interest but will never invest in any of his ventures.
-Fritz
That's what the lime is for.
Re: Corona Virus: Does anybody believe the official Chinese death toll stats? Personally, given the extreme quarantine measures and photos and videos of empty streets in Wuhan, I'd guess the situation is more serious than a mere ~80 deaths.
Every year in the US about 6000 people die of the flu. In China, with a population 3.5X larger than the US the number of flu deaths must be near 20k per annum.
The contrast between the public health measures to contain Corona vs. flu virus in China raises serious doubts in my mind about the veracity of official reports.
Cantor Fitzgerald raises price target from $27 to $35.
Because they make masks?
Which product are you referring to?
I thought I heard her say that also. I can't speculate why.
Waiting is par for the course here in HALO Land.
If resources, energy, food production and the movement of populations are appropriate for this board, then climate change, a consequence of current practices in the first three topics and a primary cause of the latter, is certainly in the purview of this board.
Climate change is the global dempgraphic headwind.
JPM now a 7.9% owner with over 4 million shares.
HEMP scam
Agree with your points. This is going to be a cash generating machine very soon, the only question is how much one would pay for it.
In addition, Helen virtually guaranteed new deals in todays's talk.
-Fritz
It made me more optimistic than I've been in a long time.
Good questions. Not sure of anything, but I think the buyback is a secondary goal. The primary goal is to increase the pps so that that top management can cash out on the strongest possible terms and go on their merry way.
As to today's and yesterday's strong bid, I wonder if they are already the at the JPM conference holding private conversations and giving inside "color" to those priviledged to be there?
-Fritz
They've axed half of the employees already. I'd prefer that the Bay Area office opened a few years ago for Helen's convenience be shuttered also.
Halozyme Provides 2020 Business Update And Financial Guidance
01/14/2020
https://www.halozyme.com/investors/news-releases/news-release-details/2020/Halozyme-Provides-2020-Business-Update-And-Financial-Guidance/default.aspx
- 2020 Guidance of $230 Million to $245 Million in Revenues and $0.60 to $0.75 in Earnings Per Share -
- Anticipated ENHANZE® Partner Progress in 2020 Includes At Least One Potential FDA Approval, Three New Phase 3, One New Phase 2 and Five New Phase 1 Trial Initiations -
- $200 Million of $550 Million Three Year Share Repurchase Program to Be Completed in First Quarter of 2020 -
SAN DIEGO, Jan. 14, 2020 /PRNewswire/ -- Halozyme Therapeutics, Inc. (NASDAQ: HALO) today provided an update on its outlook for 2020, including financial guidance.
"We have made tremendous progress repositioning the company to focus solely on driving the growth and profitability of our ENHANZE® business," said Dr. Helen Torley, president and chief executive officer. "Looking ahead, we anticipate a number of value-creating financial and ENHANZE-related milestones will be achieved during 2020."
Anticipated 2020 ENHANZE® Key Events
U.S. Food and Drug Administration (FDA) decision on the approval of the Biologics License Application submitted by ENHANZE® collaboration partner Janssen Biotech, Inc. (Janssen) in July 2019 for Daratumumab SC.
European Medicines Agency (EMA) decision on the approval of the extension application submitted by Janssen-Cilag International NV (Janssen) in July 2019 for Daratumumab SC.
Completion in Q1 2020 of regulatory submissions to the FDA and EMA by Roche seeking approval for the fixed-dose combination of Perjeta® and Herceptin® utilizing ENHANZE® in combination with intravenous chemotherapy.
At least 3 new Phase 3 and 1 Phase 2 clinical trial initiations by ENHANZE® collaboration partners.
Initiation of at least five new Phase 1 clinical trials with partner products utilizing the ENHANZE® drug delivery technology.
Update on Capital Return Program
On November 4, 2019 the Company announced its Board of Directors approved a plan to repurchase up to $350 million in stock over the next three years. Subsequently, on November 12, 2019 the Company announced the Board further approved the repurchase of an additional $200 million worth of shares in conjunction with an offering of convertible senior notes, due 2024, resulting in a total three-year share repurchase authorization of up to $550 million.
As of December 31, 2019, the Company had repurchased 8.5 million shares of Halozyme stock under this program. In addition, 2.1 million shares had been delivered to the Company as part of a $50 million Accelerated Share Repurchase (ASR), which is expected to be completed in the first quarter of 2020. Following completion of the ASR, the Company will have repurchased a total of $200 million worth of shares. As of December 31 2019, the Company had 136.7 million shares outstanding.
The Company plans to repurchase an additional number of shares, up to $150 million worth, during 2020. The amount and timing of shares repurchased during 2020 will be subject to a variety of factors including market conditions, other business considerations and applicable legal requirements.
2020 Financial Guidance
For 2020, Halozyme expects revenues of $230 million to $245 million, representing growth of 18% to 26% over the 2019 expected revenue of approximately $195 million.
The Company expects sustainable profitability beginning in the second quarter of 2020. Also, the Company continues to project annualized operating expenses, excluding cost of goods sold, of between $65 million and $75 million will be achieved by the fourth quarter of 2020.
Table 1. 2020 Financial Guidance
Guidance Range
Net Revenue
$230 million to $245 million
Earnings Per Share (GAAP)
$0.60 to $0.75
The Company plans to report fourth quarter and full year 2019 financial results on February 24, 2020.
Good stuff. Thanks for posting it. $9bn X .04 (mid-single digit royalties to HALO) = $360 million per year. That amounts to about $2.50 per share in round numbers back of the napkin math. That doesn't include other income, but I still think your valuation is a bit rich unless we get a slew of new orders. OTOH my $25 pps buyout figure might be a little too conservative.
Stay tuned!
-Fritz
As to the timing of the upgrades, I do expect a sale of the company, but I don't think there is a direct connection with the recent analyst upgrades. Do you?
I did see an article somewhere this morning that there tends to be a spate of buyouts around the time of the upcoming annual JPM investors' conference (which is this coming Monday).
(While skeptical, I hope you are right about the $40 price tag!)
Good luck!
-Fritz
I think it would have been $40 with positive results in the cancer study. Now I doubt it will go for over $25.
-Fritz
BMO Capital matches raising their target from $17 to $24.
That's fascinating. Thanks.
HALO Chief Commercial Officer has already moved on. Not sure if he was laid off or left voluntarily.
https://finance.yahoo.com/news/mirati-therapeutics-announces-executive-management-213000230.html
What's your target price that you need to cash it all in?
Going from memory (so don't bet on it LOL!) I think the earliest patents expire in 2024. There are other categories that might be much further out. It's a complicated topic above my pay grade but Helen sometimes addresses it in calls and investor conferences.
BTW the argenx deal was announced 11 months ago.
-Fritz
As a practical matter the best way to play this is VIX calls IMHO.
They can't control the timing of new deals. Do you think there is a problem underlying the recent lack of new partnerships? I think it is just a consequence of random distribution of events on a timeline.
-Fritz
It's impossible to predict with specificity, but it is a near certainty that Iran will be bent on a reciprocal action that is equally commensurate. Thus, it will have to be a very large response.
It could be a direct military attack, for example an attempt to sink a US carrier, or a terrorist attack by proxy. It might even be located right here within our borders. This potentially includes a cyberwar component, aided by Russian expertise in the background, which could involve the electrical grid or other internet dependent structures including banking assets.
One doesn't know, but I doubt that Trump has played out all of the possible scenarios before ordering this. There are moderate voices of reason within Iran who will counsel restraint, but they are not in a position to wield decisive authority and their position, never strong to begin with, probably has been weakened in the last 12 hours. Remember how irrational we got after 9/11? This is an equivalent event within Iran, in my opinion - at least among the ruling elites if not also the population at large. It is likely that they will seek to impose as much pain as possible.
The market does not yet fully appreciate how significant this assassination is. One cannot overstate how important Suleimani was in the Iranian regime. His killing is on the order of magnitude of the Ayatollah himself. Hang on, this is going to get crazy.
-Fritz
In today's PR about the JPM presentation next week, the description of Halozyme, Inc. has been changed from previous iterations. Now it says, in essence, "We sell Enhanze".
I think Helen and the other top management are looking for an exit and that includes cashing in on their substantial stock options.
There is nothing left for them to do at Halozyme. It's basically a company that merely needs a staff of shoe salesmen, who will help tailor and fit the Enhanze product to new customers.
Helen and her team members are no longer needed and they are likely not interested in sticking around doing nothing but supervising salesmen and janitors. They will be looking for other challenges.