Anavex Life Sciences Corp (AVXL)

[Gator328]

In the market there are always overvalued or undervalued stocks. Agreed.

However, it rarely (if ever) takes 5+ years for a stock to reach its equilibrium, value. At a certain point any objective person must accept that if a stock trades at a level for a long enough time, that is the market value until there is a reason, or catalyst, for the perceived value to change.

This is why arbitrage is usually a short-term situation.

You say that the wrong people own most of the stock. I disagree. The big funds that could own Anavex choose not to, and there's a reason they choose not to. At the current price the risk doesn't outweigh the reward. If and when that changes we'll see funds buying. But for the time being every major fund in America is aware of Anavex but chooses to invest elsewhere. Only time will tell if we are right or if they are right. We're the ones taking the biggest financial risk, but we also have the greatest upside. For a fund managing a few billion, a 25% gain is spectacular. That's the sort of return that gets an analyst promoted.

But you're incorrect to assume that "Big Pharma" and the "powers that be" hate Anavex. Maybe some competitors don't like Anavex but to the average fund manager the letters AVXL mean nothing. If Anavex represents an opportunity to make money, they'll own it. There's not nearly as much bias or hatred as you seem to think. Its just that right now the market believes there are better places to invest than in a highly speculative, non-revenue producing biotech. I can understand that.