Biotech Values

[linhdtu]

Why Enanta can't break out of the low 50s or 1B$ mkt cap.
I get this idea using the dividend discount method of equity valuation.With this model, the intrinsic value of any company is the sum total of all of the security’s future payouts, from time now until time infinity, discounted back to the present.
The way I see it enanta's pipeline is basically empty. NVS returned EDP239 , I can't remember what is the status of the antibiotic program and its NASH program is very new and in a crowded field.
So we are left with the two drugs partnered with Abbvie.
Gordon and Shapiro showed mathematically that when discounted at a required rate of return r, an infinite stream of dividends with a starting annual dividend level of d and an annual growth rate g is worth a present price p, roughly equal to,
p = d / (r – g)

d=payments from abbvie and it is not definitely infinite in time
r=discount rate, or required rate of return
g= growth rate of payment d

I am saying that mr Mkt is telling me he sees d growing to a maximum value, let's say 150M$/yr, a number I have seen mentioned around here, but then this 150M$ will not only grow but start declining in the future due to competition, declining patient pool etc. I know both Abbvie and enanta have said HCV is stable biz, but stability does not mean a growing d. I have no idea what the rate of decline g the d stream will have.
However given that g<0, r-g is a sum . And if I give r a number like 15% for a conservative estimate(for biotech companies) , even if g = 0, p will be 1B$ which exactly where enanta is right now and can't seem to escape.

I have made a lot of profit following Dew into enanta early.My cost is not as low as his,nor is my stake as big as his.But 20$/sh cost is plenty good and I was happy with my 30Ksh stake.I have since reduced it to 3Ksh.
Nevertheless, a belated thankyou note to Dew. Thanks a million Dew,literally between enanta and fmi.
I have been flummoxed by the sh price action which seems to be stuck around 1B$ mkt cap. I mean last June 2014 enta already hit 46. It is now barely 10% above that. I grant it can go up to 1.2B$ mkt cap a 20% move from here but anymore than that I don't see.
I welcome opposing opinions. That is what we are here for.