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

To: Jibacoa who wrote (6860)	8/5/2002 5:20:29 PM
From: Biomaven	Read Replies (2) \| Respond to of 52153

Time to step back some and look at the overall picture. Let's focus on tier one biotech stocks, because those are the easiest to value. Quarterly results were basically excellent, with CEPH the latest to show strong earnings. Yet the biotechs have been dragged down with the NASD as people worry about a double-dip recession. Yet on a fundamental basis the tier one biotechs are essentially independent of the economy. So why the fall? Two explanations I can think of. The first is not fundamental but is market-based - funds have redemptions and are selling, and nobody is buying. If this is the explanation, then eventually biotechs will de-link from the NASD and start to outperform other stocks. The second explanation is that people are starting to focus on earnings adjusted for options expense, and here of course the biotechs will be comparatively hard hit. Peter