The Peabody Report: 7/26/98
The Peabody Report is intended to foster conversation on the PFEr Board.
Comments are welcome and encouraged.
Invest only after conducting your own research.
Have PFun!
BigKNY3
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The Peabody Report: 7/26/98
Peabody Model Trend Prediction
Based on historical PFE patterns, the Peabody Model predicts the following trend direction:
After setting a Peabody Valley on 7/06/98 (105.63), PFE reached a pending Peabody Peak on 7/14/98 (120.56). After missing a Peabody Valley by .08 on Thursday (111), Da Model predicts that a new Peabody Peak of 126.59 will be reached by August 11, 1998.
Commentary
The strong relationship among the general market, Big Pharma and PFE was shown by the PFE action last week. Despite good news, PFE will not move up when the Dow corrects by 4.3% and MRK EPS disappoints. Since March, 1998, PFE has received strong support with 7.9% declines off the Peabody Peaks. The predicted Peabody has come and passed. Accordingly, the target date has been revised.
Since it is based primarily on historical trends and Mr. Peabody "gut-feels", the Peabody Model should always be placed in context of the market environments and anticipated news. As evidenced by the mythical Peabody Portfolio (see section below), the Peabody Model works particularly well for PFE investors with a "buy, hold, and buy more at the Valley" investing strategy.
New or pfuture PFErs could consider investing 50% immediately and investing the
remainder at near Peabody Valleys.
......................................PFE.........................% Chg from...............# Days
.....................................Date.........Price.......Last Price (7/24/98)......From Today
Last Peabody Valley: .... 7/06/98 ....105.63.......... -6.9% ...................-20
Last Peabody Peak*:..... 7/14/98......120.56..........+6.2% ...................-12
* Pending
Forecasted Next Peak ......8/11/98....126.59..........+11.5%.................. 16
Peabody Valley Strike Price...............110.92.........-2.3%
Forecasted Next Valley...................... 107.75.........-5.1%
(If Model is Wrong)
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Peabody Short-term PForecasts
Peabody Short-Term PForecast (7/19/98): PFE: 115.75, DJ: 9,338: Beats me!!!... Only kidding..This should be a very big news week. Expect a strong Viagra Rx report on Monday, a boast by the MRK earnings report, potential PFE Board news on Thursday ( a request for additional authorized shares), and the PFE annual analyst meeting on Friday.
Da Gut-feel: A strong PFE week with a close above 120.
Evaluation of Peabody PForecast: Viagra Rxs declined, MRK disappointed, the Board did not announce anything yet...Thumbs down
Peabody PForecast Record (71 weeks): 46-25 (65%)
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Peabody Short-Term PForecast (7/26/98): PFE: 113.50, DJ: 8,937: PFE will once again be driven by the market direction and Viagra news. Monday should be the key day to determine the current direction. Da Gut Feel: The general market could bring PFE down to a new Valley..The Peabody Portfolio has an open market order@110 1/2.
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Peabody Portfolio
Total return:........................................+93.0% PFE @ 113.5
Annualized return:...............................+85.3%
% of Peabody purchases in the black... 100%
Since April 1, 1998, 1998, the Peabody Portfolio has added 900 PFE shares to the mythical Peabody Portfolio. (Average price 105.30)
The Peabody Portfolio consists of 19 aggressive PFE purchase recommendations listed on the PFEr Board since August 14, 1996.
To date, the Portfolio has purchased 3,500 PFE shares at an average price of $58.81 (only 3.2% off the subsequent next PFE Valleys).
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# PFE Shares Purchased:.......... 3,500
Average Price of Purchases:....... $58.81
Total Costs: ...............................$205,838
Total Market Value:.....................$397,250
Total Potential Profit:...................$191,413
Date............#..........Purchase
Purchased...Shares...Price
8/14/96:..... 200 ........$36.38
10/25/96:....200 .........$40.44
12/4/96:......200..........$41.69
12/12/96:.....200.........$40.50
12/16/96:.....200.........$40.44
12/31/96:....200..........$41.50
1/2/97:........200.........$40.94
1/28/97: ......200..........$42.38
2/28/97:.......200...........$45.69
3/24/97:.......200...........$44.88
3/27/97:.......200...........$42.81
3/31/97:........200..........$42.56
8/8/97:..........200..........$55.13
4/16/98:........200...........$97.00
4/27/98:........200...........$113.00
5/7/98:..........200...........$107.50
5/15/98:.........100..........$105.00
5/27/98 :........100 .........$101.75
7/06/98 :........100 .........$106.00
Total:............3,500...........$58.81
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Suggested PFE Buying Levels
The following suggested PFE buying levels are based on The Peabody Model. The aggressive buying price level is used in adding shares to The Peabody Portfolio. However, depending upon market conditions an immediate purchase could be made at any time:
Aggressive PFE buying levels:..................$106 to $111
Conservative PFE buying levels: ...............$99 to $105
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PFuture Actions That Will Effect PFE Trends
Viagra Rx trends:..................................... Every Monday throughout 1998
News of Viagra adverse reactions
and drug interactions: ...................................Throughout 1998
International approval of Viagra:.................September- December, 1998
Initial reports of Viagra international sales.......October, 1998
FDA re-review of Zeldox: .............................. Late 1998
Launch of Zeldox:.........................................1999 (?)
PFE R&D Meeting........................................October 29, 1998
ED news in the media: ................................Throughout 1998
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Peabody V-Files
Viagra sales for the second quarter, 1998 were $411 million, the highest recorded sales for a new pharmaceutical product during its first three months on the market.
Analysts estimate that Viagra will have 1998 sales of $0.933 billion, a 36.5% increase over earlier estimates.
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PFE Stock Splits
PFE has split three times in the last ten years ( 2/91, 6/95, and 6/97). The Wayback Machine indicates that PFE usually announces a 2-1 split if PFE trade above 80 for 90 consecutive days. In the January, 1998 survey of 22 PFErs, only 43% felt that PFE will split in 1998.
At the PFE Annual Meeting on April 23, 1998, the PFE CEO stated they will consider requesting additional authorized shares from shareholders later this year. Bottom line, a 3-1 PFE split announcement will be made in late 1998 or early 1999. A request for additional authorized shares was apparently not made by the Board on July 23, 1998. |
