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Re: MON FY2Q16 CC slides:
FWIW the link provided did not work for me.
If anyone else has an issue, here is a working link.
www.monsanto.com/investors/documents/2016/2016.04.06_mon_q1f16_financial_results.pdf
From what I have seen on the primary care level, there is some demand there. Ultimately, it depends on the insurance.
Dew, any comment on the spread between AGN and PFE? My scratch calculation shows a 26% spread currently.
It is a must read. I commented on twitter that I think the amount of repeat lipid panel tests done are completely unnecessary given the new ADA guidelines. I have argued with co-workers about the rational of ordering follow up lipid panels. To me, it lacks logic due to the fact we are treating a probability based outcome. So long as people "like" seeing LDL <100, the tests will continue.
CELG: GED-0301
$CELG Phase III trial (NCT02641392) GED-0301 in subjects with Crohn's Disease has increased estimated enrollment from 984 to 1,400 patients.
from @tgtxdough on twitter
Does this mean that Celgene is not seeing enough separation between study groups?
Thank You! EOM
Dew, do you have any value estimates regarding Bendeka and Ryanodex?
Re: -3019
Has there been much off site toxicity associated with -3019? For such an ubiquitous protein I would imagine this should be a concern.
P.S. Although early, -3019 seems to be overlooked by investors. If two "rare disease" shell companies were created for -3019 IPF and -3019 DMD the combined market cap would range somewhere between 300 - 500 million (imo). Then again, I'm not sure if that speaks to the value of the drug or the exuberance of biotech investors and rare disease drugs .
I disagree on that point. One of the discussed advantages of warfarin is the fact there is a reversal agent.
Very interesting, thanks for posting. If I remember correctly, some time ago Peter wrote of a link between fungal infection and dementia. I am making huge assumptions but I suppose it is possible the reduction in gastric acid may play a role.
What is ENTA's ex-US royalty rate?
Semi OT: Zika Virus
Let me preface this post by saying I write this half in jest.
Does anyone know of companies trying to cure Zika virus? As we saw last year with ebola, media momentum can greater impact a related stock price. If I recall correctly Tekmira went from around $5/share to $20/share in a matter of weeks based on in vitro ebola data. Laughable? Yes, but I'd toy with the idea of a small investment for a similar event.
How much cash does OMED currently have?
A small basket of bio stocks trading below cash have popped up on twitter lately. Have you used this strategy before?
Dew what are your thoughts on this type of company?
Celgene Announces 2016 Financial Outlook and Preliminary 2015 Results
I think a better explanation is the henry hub spot price up 29 cents.
Re: CELG
I think it matters where your reference point was. If the market assumed 2019 generic entry the move is warranted. If the analyst was under the assumption of 2023-2024 generic entry then an extra $2-3 DCF is also warranted.
What do you expect to see in the next earnings? (If anything)
Re: KMI
Jbog,
Compared to MLP's KMI doesn't stand out in distribution + CAGR metrics. If compared to general companies, KMI has to begin to show better debt metrics, free cash flow, and internally funded growth. The PR stated that $5billion of cash flow will be generated. Let's say capex is $3 billion and dividends total $1.1 billion. 900 million is left to pay down $40 billion(!) of debt. How do you currently evaluate KMI, I am interested in your thought process.
Re: Oil benchmarks at 7-year lows
Perhaps a mute point but I still cannot reason why the price response was more dramatic today compared to last friday.
How is a phase 1 / preclinical company with 50% rights and a 1.6 billion MC the most hated company?
Celgene's Revlimid ongoing patent litigation may become an example of this. Without looking it up, I think the first patents expire in 2018 with poly-morph patents extending until 2028. However, not sure if poly-morph patents fall under the formulation umbrella. And of course, it remains to be seen if the 2028 group of patents holds up in a court of law.
Are "HCV failed patients" currently retreated?
Re: SMMT
Was any further information given about patient severity/prior CDI episodes? Oral Vanco would most likely produce a higher cure rate in Mild CDI and it is common to use Vanco + Metronidazole in severe CDI.
http://www.ncbi.nlm.nih.gov/pmc/articles/PMC3088840/
The ratio variations can be somewhat explained by the different maturity and balance sheet strength of each company.
For example, FANG & PE clearly have high ratios. This can be interpreted by saying the companies have high quality leases but do not have the financial clout to turn their undeveloped properties into cashflow. Thus in my opinion these companies are close to fully valued (compared to peers) without taking into consideration buyout potential.
OXY & PXD are larger companies, though still maintain a higher EV/EBITA ratio than average due to their strong balance sheet and premier leasing positions. Stable companies, clearly. Undervalued, not quite sure.
DVN & ECA currently have lower EV/EBITA ratios while having high quality leases in the Delaware and Wolfcamp respectively, implying more value per share compared to peers. Both are more leveraged, particularly DVN, but maintain decent balance sheets.
At least this is how I interpret the data.
Permian Basin EV/EBITA company ratios
We could argue within the permian if the Midland or Delaware is more prolific, but regardless those two basins garner the most attention. A look at the cash flow metrics of the companies with tier 1 acreage: The number columns represent 2015 EV/EBITA and 2016 EV/EBITA respectively.
APA - 6.3x 5.8x
CPE - 8.0x 6.9x
CXO - 9.9x 10.1x
DVN - 5.7x 7.8x
FANG - 13.4x 14.5x
ECA - 6.7x 5.3x
EOG - 12.3x 11.3x
OXY - 11.7x 9.9x
PE - 18.8x 11.6x
PXD - 13.7 11.8
The ratios are not a perfect comparison, but in a sense do show the current valuations of these companies. ECA is my largest energy position.
...is not exactly an enterprising proposition, IMO.
It is for the CEO ;)
Re ZIOP
The issue I have with ZIOP valuation is that XON has 50% ownership of everything. In other words, if ZIOP owned 100% of it's products would it currently support a $3 billion MC?
I will try to listen to the call. I appreciate your responses and best of luck with your investment!
Re: MON EPS growth
In my opinion this arbitrarily timed push for 20% EPS growth has to be the result of management incentives. There is no sound reason to incur 10 billion in debt over a 2 year span for buybacks. With 2 billion a year in FCF the company would have plenty of cash for moderately paced, self funded share repurchase plan.
In the presentation MON shows 2016 EPS estimates of $5.10 - 5.60, with an expected uplift of $.24 - $.27 EPS due to decreased share count. If the share count remained constant would 2016 EPS actually be $4.85 - $5.35?
What in particular impressed you about the presentation, and how do you expect them to leapfrog juno, kite etc? I will leave blue out of the discussion because gene therapy is their major focus.
ZIOP valuation
How do you justify the current MC of $1.66 billion?
Energy Perspectives by Statoil: Long Term Macro and Market Outlook
JBog,
Would you agree that oil has different market dynamics than other commodities? Numerous countries depend on $80+ oil price to support everything. As far as I know, no other commodity is quite as important in a geo-political sense.
I voted for $65-$75, though my answer was almost $75+ simply due to the extended range.
The extreme pessimism surrounding crude still surprises me. In my uneducated opinion, the combination of limited global spare capacity and the current geo-political status of the middle east (and Russia) has created a powder keg situation for the price of crude.
I think within the next 2 years (I realize that's not the exact question) the price of crude will be double the current price. I have placed bets accordingly.
How is that any different than Ackman holding a call to explain (or defend) a position?
I am surprised that ACAD gets the love that it does. IMO the expectations are currently too high for pimavanserin. I say "currently" because the perception could change with positive Alzheimer's results however that is far from a slam dunk.
The differential between ACAD at $50 and MDVN today would be less than 2 billion dollars. One has revenue close to 1 billion per year and one has yet to commercially develop a drug. Then again, it seems no one cares about valuation until the company transitions from development stage to commercial stage.
Trying to reason why you bolded the below statement. Isn't it obvious that 2016 HCV sales will be larger? If V-Pak had no further growth, 2016 HCV sales would be significantly larger than 2015.
The was I understand it, ENTA will receive $30 million in Q4 and $80million on 2-gen approval. With approximately $250 million in cash the current EV is $200 million. Is this correct?
FGEN + 16% today on no news I am aware of. Eom.
Or perhaps someone realized that same store sales growth isn't the same as whole company growth!