I think the question "is company XYZ overpriced?" is pretty near impossible to answer. I think the best people can do is offer their opinions one way or another, and leave to the rest of the investing community to agree or disagree.
Having said that, I would say that the only thing that would disagree with is the statement that "Mutual fund interest is high." By comparison, ICOS has a relatively small percentage of its stock held by institutions, although it is spread among something like a hundred different institutions. Of course, institutional ownership isn't necessarily a good indicator of company health.
I don't know how much current weight I would put into the Gates factor during the recent run from the mid-20s. There can be no doubt that about six months ago, misperceptions about Gates's investment led to a run, but his position in this company is already widely known among those who follow this company.
I don't know why ICOS has moved so much recently. Possibly because of IMNX's big jump today, possibly because of anticipation of clinical trial results, possibly because of the current uncertainty about Zonagen's ED product. In short, I'm fairly puzzled, but pleased.
Edward is right - clinical trial failures, which are inevitable with any biotech, will put pressure on ICOS. The next few months might be interesting, since ICOS is expected to report results from a couple phase II trials and is expected to initiate at least one phase III trial. Jittery investors could consider buying out-of-the-money near-term puts, if they are worried about a nosedive.
Just my opinions,
Lel |
