CVTX, From a Friday Dow Jones story
Biotech stocks took a pounding Friday after Merrill Lynch & Co. analyst Eric Hecht issued a cautious outlook for the sector for 2001....
Though Merrill's Hecht sees underlying earnings growth for biotechs approaching 30%, he is worried that biotech stock valuations are still too high. Hecht is also "most uncomfortable" with the ooh-ing and aah-ing over genomics stocks. He said many genomics companies have poor business models that aren't likely to generate future cash flow.
Analyst Matthew Gellar of CIBC World Markets Corp. offered a more positive outlook on the biotech sector, saying interest in biotechs seems to be increasing, but investors are waiting for the sector to bottom out before buying. He said 2001 could be the "most exciting year" in terms of new products.
According to Hecht, companies with new products stand to do well in 2001. Among his recommendations were Adolor Corp. (ADLR), IDEC Pharmaceuticals Corp. (IDPH), MedImmune Inc. (MEDI), Serono SA (SA) and CV Therapeutics Inc. (CVTX)....
Shares of CV Therapeutics, which Hecht upgraded to intermediate-term buy from accumulate, were the biggest losers in the sector, recently changing hands at $40, a loss of 34.3% or $20.88. Earlier Friday, the Palo Alto, Calif., company said an interim study of trial data for Carisa, a drug to treat angina, found statistical variances among patients' treadmill times. |
