biowa,
In fairness to Kramer, he wasn't specifically talking about biotech - instead he was talking about the newly public dot.coms (like TSC itself?).
The main point to remember is that stocks are driven in the short term by perception, not "reality." Right now the perception is that biotechs, being "story" stocks, are lumped in with the dot.coms. Unpleasant, but that seems to be the current reality.
Further, unlike the tech stocks which can be rescued in the short term by earnings, it's hard to see what will change this (erroneous) perception quickly. Curing cancer in mice again isn't going to do it; nor is sequencing the genome (one more time); and finally there isn't much in the way of FDA biotech approvals on the near-term horizon. Perhaps only a luscious munch or two will reassure the masses that someone else thinks that biotechs have value.
The bottom line, though, is that biotech fundamentals (unlike dot.com fundamentals) remain sound. At some point, perceptions will again adjust to this reality and biotech will boom again.
Peter |
