SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Biotech / Medical : Biotech Valuation
CRSP 57.58+0.9%Dec 10 3:59 PM EST
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: Jibacoa who wrote (3414)4/12/2001 8:06:26 PM
From: Biomaven  Read Replies (2) of 52153
 
Well the herd seems to have finally noticed that the biotech majors are not muttering about "earnings visibility" and "a sudden unexpected slowdown of orders." Further, they have maintained their earnings while increasing R&D, something that I'm willing to bet isn't the case in high-tech land.

(I concede we did get this from two biotech equipment suppliers MDCC and ABI, but I'm betting that was related to their particular niches more than anything else. It certainly doesn't apply to the non-trickle companies.)

On quite a different issue, it's 10-K time, and it's sometimes informative to look at a little-noticed item tucked away in the footnotes. This is the report of option grants, exercises and cancellations for the last three years. One key item to look at is cancellations - these are options cancelled because an employee quit (or was fired) before the option vested. A rising trend of cancellations as a percentage of options outstanding can be an advance signal of internal turmoil. Also worth noticing is to what extent employees cashed out last year - look at exercises as a percentage of options exercisable at the end of the previous year. (This has to be modulated by checking what portion of the options were significantly in the money at some point during the year).

I'll post the VRTX numbers as an example in the following post (so I can use a fixed font). Note the low (and declining cancellations), and a pretty hefty cash-out last year (around 50% of what was exercisable).

Peter
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2025 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News