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To: John Solder who wrote (22427)	3/11/2000 10:40:00 AM
From: DanZ	Respond to of 53068

Biotechnology stocks. This is what happens when smart businessmen start taking advantage of the boom in a sector. It doesn't mean that the end is near for biotechnology stocks, but this certainly can't be regarded as bullish. NewsTraders Daily Report for March 9, 2000 Roche Holdings, the holder of a 65.6% stake in Genentech (DNA), plans to trim its interest in the biotech firm by 6.7%, revealing plans to sell 17.3 million shares in an underwritten public offering. I wouldn't get too excited about a single offering from a single company, but if more offerings show up, I'd get more concerned. Biotechnology stocks are in favor right now, but I don't think that anyone should forget the bust of the 1980s. There's no doubt that many biotech companies are developing excellent technology and products, but traders are bidding many stocks to unreasonable and unsustainable prices because of the excitement and momentum. Fundamentals will win in the long run, and if these companies don't eventually produce profits to justify their valuations, they will come down. I can only think of two reasons that a company who has no change in fundamentals would trade from 5 to 100, for example, over a few months period: Either the company was undiscovered and the attention brought in money that sent it to fair value, or traders are bidding the stocks up to ridiculous prices because of momentum. I suspect that the latter is the case for many of these stocks and I would have one finger on the sell button if I owned them. Luck to all, Dan