"Don't try this at home." Agree. lol. And what I'm am also trying to say, and I hope in a nice way, "And also don't try this on this thread."
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On the one hand, we're talking specifically about a late-stage biopharma with no revenue. Can anyone call it a value stock? How?
Otoh, I agree somebody on his staff is recommending this to Klarman who bought it and has added to it. Therefore, one or more people has/have concluded this is a value proposition of some probability. Maybe as you say, risk-mitigated for Klarman by his holding several such biotech stocks.
Which gets back to the original poster's (op) comment/question: Is it possible to evaluate biotechs, and how to do it. For that op then, the recommendations by Klarman's "industry expert" people would provide support that biotechs ARE able to be evaluated. (Klarman keeps investing in biotechs, so he must be satisfied with the overall results of his analysts.)
This brings up other aspects and comments by me.
1. A person may need to spend a lot of time and effort to become an industry-expert. And you may need to be one in order to be consistently successful in this sector. Why focus time/effort specifically on this sector when other sectors may provide as much profit with less effort? (Example?: For myself and only jmo: Instead of my having wasted time looking at, pondering, and discussing esoteric PRTK, maybe there's an opportunity with booming TX real estate, given Dallas/McKinney TX and maybe elsewhere. Looking at TX, I pass on HOV. I'll now consider adding to my MHO position though.)
2. If you blindly follow, Klarman, essentially what you are doing is "playing the other man's game". If the stock moves up, you're ok. If the stock moves down, you're lost because you don't know why you own it.
3. To myself: If I'm going to follow Klarman, I might as well own something that he owns that makes some sense to me. I refer to his holding of AGN, which I have and am willing to add to. |
