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Biotech / Medical : Biotech Short Candidates -- Ignore unavailable to you. Want to Upgrade?

To: tuck who wrote (7)	1/9/2001 1:52:49 PM
From: cyberman	Read Replies (3) \| Respond to of 897

Biotech shorts will win big in 2001 for a variety of reasons 1) Right now at arguably its biggest sector conference of the year J.P. Morgan Chase H&Q the sector can't generate any solid momentum 2) The sector ran up way too much in 2000 3) The economy is not in great shape 4) Momentum money is leaving this sector big-time My favorite short today is IMA - Check out the 150ish PE on that stock - looks a little high for my taste, plus the technical chart doesn't look too good either - So if it exceeds earnings the PE goes down to what 125??? Genomics stocks are also ripe, stay tuned

To: tuck who wrote (7)	1/9/2001 11:49:02 PM
From: prophet_often	Read Replies (2) \| Respond to of 897

IVGN rode the genomics wave last year, but I consider it a research products manufacturer. From the company profile: Business Summary Invitrogen Corporation develops, manufactures, and markets research tools in kit form and provides other research products and services to corporate, academic and government entities. They make "kits" for genomic research. So what? This is a low margin business. The profile lists their profit margin at 0.6% and their operating marging at 1.8%. Am I missing something here? Invitrogen sells research products to genomics companies yet lets look at their valuation: Using NEXT years analyst estimates of 1.31/sh, IVGN is trading at a forward P/E of 47. Why is this company trading at or above valuations placed on top-tier biotechs? For a low-margin research products business? I agree that this company has value but not at this price. Meanwhile, the chart has rolled over: siliconinvestor.com I traded it for the first time yesterday for a 4 point daytrade short and just watched it today as it followed through on a weak bounce off support late yesterday at 56 to close at 61. I am looking to re-enter my short on this bounce. I would really like to see close to 70 again to re-enter for maximum safety and would play it for a longer term short. That is the first of my biotech short candidates. Having worked in the biotech industry for 16 years and having used Invitrogen's products, I really think the valuation is out of whack here. What do you think? Hope I can contribute a few more here in the future.