Elite Pharmaceuticals Inc (ELTP)

[no2koolaid]

I remember reading just how great Elite is from a business standpoint right before SeQuestOx failed and shareholder value crashed !!!!!!!!!!!!!!!!!!

Sorry, but this made me laugh out loud. Why?.

Because, once again, it fails the test of business knowledge; particularly when one recognizes the nature of the business cycle. For those seeking to understand that concept more fully and understand its relevance, consider that each business cycle is a swing through six different stages from peak to trough to peak and tends to occur with variable periods of time, ranging from around 2 to 10 years – with the average of 6 years. How is this related to Elite's movement through that time?

Between 2016 - 2021, we have seen some highly touted drug companies go from peak in 2016 to a 2021 trough or worse, BK. Just to show I have done my research...these companies include: MNTA, AKRX, MNK, SYGP, NWBO, ICPI, PRED, AMRN, among others. But not Elite. This is notable because three of the companies got caught up in the 35% decline of the litigious pain med market that Elite wisely decided to exit (much to the confusion of some). In fact, it is the pivot away from pain meds that has enabled Elite achieving the profitability that I applaud and point out is the quintessential difference when comparing Elite from 2016 to now. That much is obvious from my business acumen perspective.

Which leaves me to ask – How is it that achieving profitability seems lost on shareholders? I ask because very few OTC companies are profitable. Moreover, less than forty percent of all publicly traded companies are profitable. So, Elite is operating in some rarified air. I trust investors recognize that, at some point, the now 800k shares traded daily will revisit the previously seen level of 20 million shares traded daily. And, if there is the run-up in p/s that some seem to think is on the horizon, it begs the question – Why one would not seek information now and employ it to get ahead of the run? Seems logical, does it not? But, as I have said before, my approach is to make the business points and leave the decisions of investing or divesting to the reader. Still, it is surprising that more investors fail to recognize that sometimes a stock can undergo strong fundamental developments and the share price can lag behind for years. Again, not my words but those of one who is an expert in pharma.