Idenix Pharmaceuticals (IDIX)

[DewDiligence]

IDIX’s Valuation is Preposterously Cheap

As of 6/30/07, IDIX had $160M of cash and marketable securities and no debt (#msg-21777418).

There are about 60M fully-diluted shares for valuation purposes. Thus, on 6/30/07, IDIX had about $2.70/sh share in net cash.

In other words, at the current share price, IDIX is trading at no premium to the value of its cash, and buyers of the stock are getting the business and intellectual property for free.

Even if one subtracts the $50-60M in cash that is expected to be burned during the second half of 2007, at the current share price buyers are paying only $50-60M for the business and IP, which is dirt cheap, IMO.

True, there are other biotechs trading for less than or equal to the value of their cash, but most of these are broken companies with little chance to recover before the cash runs out. Among biotech companies trading at cash value or less, IDIX is unique in having both an approved drug and a rock-solid balance sheet.