The latest investment letter from Leo Hood, a monthly service that my investment group subscribes to.
BRIEF UPDATES ON OUR FAVORITE LONG (BJCT) AND FAVORITE SHORT (MU)
(I won't discuss Micron, but here is Bioject, word for word).
7/17/98
We first recommended this stock at $0.56, again at $1.38 and $1.81 and now we reiterate our bullish posture at $1.84. This stock has much more upside potential and the pace of business development may start to accelerate over the next six months. Earlier this week it was announced that the drug giant Merck & Co. (NYSE-MRK) has entered into an agreement that allows Merck the rights to use the Biojector needle-free injection system to deliver selected vaccines. DO NOT UNDERESTIMATE THE SIGNIFICANCE OF THIS ANNOUNCEMENT.
One of the attractions of the Biojector system is that for certain classes of drugs, especially the most modern, genetically enginered DNA vaccines, the Biojector system offers improved efficacy of the drug versus needle injection. And not just a marginal difference, but an improvement of double and triple in many cases in simple terms, the reason is that a needle injects a bulbous deposit of serum in the body while the Biojector disperses the serum directly in the muscle mass where it can be readily absorbed and provide maximum benefit to the patient. Now, if Merck has already figured this out and paid up for the rights to use the system, how many other drug companies might make the same discovery later on? Many!!!!!!
Perhaps this development is one reason why insiders have continued to buy more Bioject stock on the open market at prices up to $2.21 per share in the past few months (NO SELLERS). From my talks with some officers and significant shareholders of Bioject, I get only a feeling of enthusiasm. The insiders believe in their company and envision a dynamic future. With this recent initial deal with Merck, I think the starting bell has now been rung and over the next six months to a year we could see this stock triple again. We will probably not see this stock dip below $1.50-$1.75 again, so we would add to prior positions right here (under $2) and buy even more if it should dip back to that $1.50-$1.75 support range. Target price $5 during 1999. |
