<< It's so hard to know with startup biotechs but this technology sure looks interesting. So does RNA silencing, but again, it will either be huge or a flop. >>
The real question is not whether the technology will be huge or a flop, but rather will the markets bid up the price of the stock or not. The answer to this question has to do with perceptions and judgements. These, in turn, often have little relationship to reality, and not infrequently this is quite intentional marketing.
In March 2000, the question was not whether the dot.bombs had a clever idea or not. But most of us got suckered into thinking that was the question.
Huge technology sometimes goes nowhere. RSTG has pretty good technology. Went nowhere for a very long time. There are many companies in the digital power sector that have huge technology, but they have gone nowhere also. Same with nanotechs, which by and large have languished.
On the other hand, smoke and mirrors and a wing and a prayer can be hugely successful. I remember trading SCMR when they went public. At the time of the IPO, SCMR had no revenue at all, no product, a rather vague description of a product and rumors of just one potential customer who might become interested should they actually produce a product. They priced at I believe $24, and that was upped to something like $45 the night before they started trading. SCMR finally opened at $250, and shot up over $1000 before the session was over. Here's the chart (doesn't go up to $1000 because a number of splits the first year):
139.142.147.218
One other thing worth mentioning. I can't remember the exact figure, but I believe something like 95% or more of startup biotechs fail within 5 years. One could make quite a good living by shorting every startup biotech that comes along at any old price, and just being patient and waiting for them to fail. You would ultimately be wrong only rarely.
T |
