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Biotech / Medical : VD's Model Portfolio & Discussion Thread -- Ignore unavailable to you. Want to Upgrade?

To: Vector1 who wrote (8799)	6/6/2001 12:08:26 AM
From: Vector1	Read Replies (1) \| Respond to of 9719

From a JP Morgan report today on CELG SUMMARY/INVESTMENT THESIS: We are upgrading shares of Celgene Corp. to a BUY from a Long-Term Buy for three reasons: 1) positive biotech sector call; 2) growing Thalomid franchise with partners; and 3) proprietary multi-product pipeline. Celgene has been a major beneficiary of renewed positive sentiment in the biotech industry. We expect strong news flow in the very near term from an analyst meeting in New York on June 7 and an expected NDA filing for Thalomid in 3Q/01, followed by solid mid- to long-term news flow from the SelCIDs, IMiDs, and kinase inhibitor programs. Weekly prescriptions for Thalomid hit a new high for the week ending May 25 and growth appears solid at 36% y/o/y for the second quarter 2001 and up 4% sequentially over the first quarter 2001. Our recently lowered Thalomid sales estimates of $18 million for 2Q/01 and $76 million for the full-year 2001 appear well within reach. Our twelve-month price target for CELG is $45. We arrive at our target price by applying a P/E multiple of 70 (approximately 2x growth) to our 2004 EPS forecast of $0.93, discounting at a risk rate of 27.5%.