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That might be true and ultimately a good strategy. However, she should have never guided 3 deals for 2023 (including a HVAI) and still not delivered 9 months into 2024.
Despite of this shortcoming, halozyme is still a bargain.
I concur with this post from another board regarding JPM’s rating earlier today:
“Not only this analyst is a joke, but the investors following him are unable to read by themselves: EPS grows by 40% this year, 20% next year, 25% in 2026 and 2027.
PE is 16, ROE is 150%! EV/S seems high at 10. But the revenue has high gross margin (70%) as half is made out of royalties (higher percentage next years). This is a typical Warren Buffett stock, although the visibility is limited until 2028 now.
The development risk with this pharma is very low as it uses a better modality to deliver pre-existing blockbusters. It is difficult to find something as boring as this with high growth and low risk. This is shooting fish in a barrel, per Charlie Munger.”
Here is why while you are right about Helen’s inability to deliver new deals (2023-2024 so far), you are wrong about the direction of the share-price.
Page 14 on
https://s28.q4cdn.com/284259014/files/doc_financials/2024/q2/HALO-2Q24-Earnings-Deck-FINAL-FINAL-004.pdf
EVEN WITHOUT A SINGLE NEW DEAL, the top and bottom lines are projected to grow over 20% per year until at least 2028. Also, despite the recent run up, halo is still trading at a forward (2024) PE of around 16 and PEG of 0.6
https://www.nasdaq.com/market-activity/stocks/halo/price-earnings-peg-ratios
Halozyme is a great bargain and will be trading much higher over time even without new deals and despite the current management shortcoming.
If we get new deals or a new CEO, it would be icing on the cake.
No. If history can be a guide (your posts over the past several years are here on this board for anyone to see), you will post a series of bearish posts that will defy the fundamentals and realities of halozyme. Halozyme will continue to appreciate in price. Later in the share-price run up, you will claim that you had been long that whole time but that there are better investments out there than halo. Then you will disappear.
Nonetheless, your posts are entertaining and always appreciated.
Yes! Easycomeandgo is back posting on this board. Welcome back. Order is restored. Our full set of permabears are all well and posting again.
Very bullish sign! Dips are to be bought hand-over-fist.
Come on Mr. Market give us more juicy bargains.
Look at the permabears get all excited for a neutral rating by JPM. These are the same permabears who were forecasting doom and gloom when we were in low $30’s (as well as $20’s and teens). We have doubled in share-price since. Now with a neutral analyst rating and a 5% share-price drop, they claim they have been right all along.
The amusing part is that despite the neutral rating, JPM raised its target price! Notice they don’t think we are heading back to the $30’s where these permabears were bearish.
There are plenty other (majority of) analysts with buy ratings and much higher price targets (some in the $70’s). Morgan Stanley has provided some of the best research/coverage on halo over the years. They raised their target price from $59 to $64 just last month and maintained a buy rating.
Overall, I’m happy to see permabears back posting with excitement. Historically, this has been a bullish sign.
Where did you see that? Link?
From Artisan:
"Halozyme Therapeutics surged higher after it reported better-than-expected Q2 results and reconfirmed its current-year guidance. Cash flow growth during the quarter was driven by a 12% increase in royalty revenues, although we note that some of these revenues were pulled forward from Q3 to Q2. Based on talks management is having with other biotech companies, we think the company will secure more new deals this year to license its ENHANZE® drug delivery platform. We value Halozyme’s high cash flows, which it has used to support share buybacks."
The cadence with halo at least for 2024 has been to run up ahead (weeks to months) of anticipated catalysts, then take a haircut (5-10%) a week (or two) before the news release and then resume a sustained run up.
I hope the longs had a chance to load up more :)
Page 5 of Halo’s most recent Halozyme slide deck (see link below)
Upcoming Potential
Approvals
• Ocrelizumab SC (U.S.),
September 13, 2024
• Atezolizumab SC (U.S.),
September 15, 2024
• Nivolumab SC (U.S.)
December 29, 2024
But I’m not seeing Atezolizumab SC (U.S.) on FDA’s PDUFA date calendar!?
Does anyone else see it?
https://s28.q4cdn.com/284259014/files/doc_financials/2024/q2/HALO-2Q24-Earnings-Deck-FINAL-FINAL-004.pdf
Thank you, Mr. Market for giving us a chance to load up with a 10% discount (from recent all time high) ahead of the two blockbuster ENHANZE/halozyme PDUFA dates next week
Merck could not use Enhanze for Keytruda because BMS had signed an exclusive contract for PD-1’s.
Catalysts from today’s WF conference with Helen:
IRB part B assessment on theraputics with 2 active ingredients is expected any day now. If part B follows part D went, more pharma will look at Enhanze and partership with Halozyme to delay CMS price negotatiations by additional 5 or more years.
Regarding check point inhibitors (Opdivo, Tecentriq), Helen said that pharma will likely expedite conversion to SC with Enhanze ASAP. This is because experience with Herceptin years ago showed that once patients convert to SC, they never go to IV biosimilars. So BMS and Roche will be eager to get their patients converted to Opdivo SC and Tecentriq SC on accelerated pace.
At least one new partnership before year end.
2 PDUFA dates this month and one is September.
A juicy 7% haircut since the recent all-time-high for reasons that have nothing to do with halozyme. Enjoy the bargain shopping.
Halo vs S&P 500
HALO S&P 500
Value metrics:
P/E last 4Q
24.8 28.1
P/E forecast EPS
16.1 33.5
P/Free Cash Flow last 4Q
19.8 31.5
Growth metrics:
1-year forecast EPS growth
43.1 21.8
Long term growth rate 3-5 years
28.0 12.0
FINANCIAL METRICS (%)
Gross margin
80.0 40.7
Net margin
38.6 11.0
Return on assets
17.8 4.9
Return on equity
153.2 18.4
Based on Stockrafter’s research, we might be getting partnership announcements with Merck and Novartis any day now
Another terrific find! Thanks for sharing. Bravo!
… same goes for posts from pre-2020 and. 2019 when halo was trading in single digits and low teens. Interestingly, some of the very same permabears were bearish on halo back then too. They have been with us for a long time and I hope they stay for many years to come.
I like going back reading the posts from November 2023 and Jan-feb 2024.
It’s amazing how the permabears were so adamant about their views and ridiculed those of us who believe in the fundamentals and common sense investing.
It makes me feel good to know that those of us who read their posts and yet stayed long had enough conviction and foresight not to be dissuaded. Just imagine if you had sold and walked away instead of loading up more. I would be super upset with myself now if I had given up.
I do like the permabears and their posts here. Their doom and gloom posts tell me we are not at the top of the run. I would start to worry when everyone is on the same side.
For a day or two earlier this month, I thought that the permabears had given up. One of them (easycomeandgo) left this board for good. Others still post their bearish views. I’m happy to have been wrong 😊
No one ever said that all subcutaneous injections will have to be with Enhanze!
There were SC MAB in existence before Enhanze and there will be plenty now and in the future.
Not sure what your point was with this post.
Upcoming Halozyme FDA Approvals/PDUFA dates:
• Ocrevus SC (Ocrelizumab SC),
September 13, 2024
• Tecentriq SC (Atezolizumab SC),
September 15, 2024
Don’t be surprised if we continue the run ahead of these 2 key catalysts.
Great research! Thank you and nicely done
Found it. It was last call on Fast Money Carter said much “more to come”
Which CNBC show? Thanks for sharing
Thanks for sharing. From your first link, I learned something new. Apparently, Halozyme has a partnership with Merk that we did not know about. From Table 1 in the article:
Merck KGa
rHuPH20
(Enhanze, Halozyme)
Erbitux
(cetuximab)
Pre-clinical
That’s not what typically happens. Usually the analysts recognize that they have underestimated the value and raise their price target to keep up.
Anyone who has been in the market for long enough has seen this pattern.
… oops I think I posted a little too early. Looks like at least one permabear has not capitulates. Thanks for your post, Maumur.
Maybe, we ate not done after all.
I wonder if we are approaching a temporary top or a pause in this uptrend.
The only reason I say this is that there are signs of capitulation in some of the halo permabears on this board and elsewhere.
One of the most adamant permabears (Easycomeandgo) has left the board and others are posting about holding until the end of the year!
Top US small cap fund manager Leo Harmon holds Halozyme shares in the Mesirow Small Company Fund that he runs with Kathryn Vorisek. As at the end of June, the position represents their third-largest holding. These two investors are among 18 of the world’s best-performing fund managers that have bought Halozyme shares – each of them among the top 3pc of the more than 10,000 equity managers whose performance and investments are tracked by financial publisher Citywire.
The conviction of these investors has led Halozyme to be given a top AAA Elite Companies rating by Citywire, which rates companies based on their ownership by the world’s smartest professional investors.
“What we really like about this company is the fact that it’s a loyalty company,” Harmon said. By that he’s referring to its deep-rooted relationships with multiple pharma partners, some of which seek approval to use Enhanze technology with several treatments, removing the need for a blockbuster or single wonder drug to make the investment pay off.
“They have multiple opportunities in various types of compounds where they can transition their underlying technology into several different drugs and collect royalties from their large pharma partners,” he said.
The company could be on course to receive between $1bn and $1.5bn in royalty revenues over the next five years purely due to the growth of the overall market, Harmon said.”
https://finance.yahoo.com/news/questor-biotech-firm-profiting-overlooked-190000187.html
You two have been saying this when we were in teens, 20’a and 30’s. You were wrong then and are fundamentally wrong now.
You forget that we have a terrific CAGR between now and 2029 without even a single new deal. Wave 3 and 4 (already signed deals but not approved products) will have a bigger total market than wave one and 2 did.
Anyone reviewing the data will know that this stock is undervalued based on the EPS growth that is already de-risked and even without a single new deal.
Of course new deals will be welcomed and are around the corner but they are not necessary for halo to continue to appreciate in share price.
Agreed with everything other than this rally being “technically” driven.
It’s pure fundamentals!
Nothing ever goes up in a straight line without little pull backs. I for one, would welcome an opportunity to buy more on a dip.
The key is to enjoy bargain buying just as much if not more than watching your portfolio grow.
The catalyst and reasons why halo is still great value are all still intact.
I think we just hit an all time intra-day high.
Agreed!
Yep, I didn’t love the director selling either. But then again, many of the directors were selling when halo was trading in teens and 20’s. They often sell for personal needs or to rebalance their portfolios and not have too much exposure in one name. Just like their selling did not forecast doom and gloom back at far lower prices, it does’t scare me too much now (unless they exit on mass)
CEO only sold the options she was recently rewarded and did not reduce her total holdings. She still owns 600k+ shares.
Sure… and all those analysts upgraded their price targets the day after the earnings call because of a “Reddit type of a thing” and not because of the catalysts discussed on CC.
It’s one thing to make a false forecast (no shame in it, it’s not easy to get the future right), it’s another to insist that one would have been right had it not been for some “Reddit type of a thing”