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Biotech / Medical : Biotech vs. Shorts -- Ignore unavailable to you. Want to Upgrade?

To: KewlHand who wrote (339)	1/30/2000 11:36:00 AM
From: scaram(o)uche	Respond to of 427

>> Does anyone have a 'model' for estimating how far that can push a price if they are all forced to cover say within three days of approval? << Market caps, once rational players dominate trading, usually have a relationship to good valuation models (based on projected sales). It is almost the norm that biotech market caps, at the stage of FDA approval, are out of whack with any decent valuation model. If sales and margins are projected, by the analysts who have a good record and who have gotten the exisulind story correct to date, to support $690 million, then your question is a good one. If not, the shorts won't cover..... they'll just wait. In that instance, those who expected the shorts to cover, on a trading basis, might be expected to bail. If you don't start with reasonable estimates of sales and margins, and then project back to a market cap that they will sustain, then you're lost. >> There is plenty of life left in the CLPA short squeeze yet. << Convince us? I don't know the story; I have no bias. Which good analysts have gotten the exisulind story correct to date, and what are their sales projections? >> It is my belief that the coming week or two will go down as a landmark in shorting history, when the larger players get vapourised upon the imminent FDA approval. << That would be cool. However, FAP is not a huge market, and it is not intuitively obvious, to me, why one would see a huge squeeze at this market cap.

To: KewlHand who wrote (339)	1/30/2000 2:24:00 PM
From: Jesse Schulman	Read Replies (2) \| Respond to of 427

Kewl, seems to me the famous CLPA short squeeze is the dog that didn't bark in the night. Longs have been looking for the squeeze since 9, me among them. Maybe some of the sharper up-days were propelled by covering, but the stock has tripled and short interest is as high as ever. Why should the squeeze come now, if it didn't come then? It's nice to see CLPA far less-successfully manipulated than it was, but shorts are still betting on a decline after approval, and my guess is they'll be right. The argument that FAP is too small an indication to be worthwhile has more pungent immediacy than talk about off-label or the rosy future with prostate. Rick's question about which analysts are projecting what sort of revenue hits the nail on the head, since as you know only Janney is following this stock at all. If after approval (knock knock) CLPA gets some decent coverage from analysts who take the effort to understand the story, then the price could go up. Add in some whiz-bang prostate results this spring and the stock could soar. Market timing is definitely not my specialty, but short-to-middlin' term it's hard for me to see an extension of the run. Looks more like a significant pullback first. itss