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As the length of product cycles gets more compressed, the economic lifetime of a viable technology is getting shorter. Valuing an investment inherently involves within the calculation the factor of time. This is true within biotech and computer software, hardware, etc. Occasionally (occasionally), proponents of a given company overstate the economic lifetime of an apparantly good development. Other times, the lifetime may be underappreciated. Short sale candidates are often technology stocks who miss product cycle shifts and get stuck with unsold inventory. Or, a biotech firm that just spent $100 million on a promising drug believing that THEY would have the best product for disease "X" for 10 years. Analysts model a growth curve extending out 9 years for conservatism. WHOOPS! Forgot that the market was so big that 73 firms worldwide were working on the same problem? Hopefully, this can be a thread to discuss technologies with less bull and bear bashing of individual companies. |
