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Biotech / Medical : Agouron Pharmaceuticals (AGPH) -- Ignore unavailable to you. Want to Upgrade?

To: Izzy who wrote (2492)	10/26/1997 2:11:00 PM
From: JOHN W.	Read Replies (4) \| Respond to of 6136

Subject: Once Again: The Sky Isn't Falling Date: Sun, Oct 26, 1997 11:43 EST From: MillJacker Message-id: <19971026164301.LAA11255@ladder01.news.aol.com> Some folks on SI are proving once more that you can find things to worry about in even the happiest situations. This time, it's insider selling and a high PE. Insider Selling: Most analysts agree that insider buying is almost always significant, but selling rarely is. In three months, seven Ag people sold some stock. In each case, it was a small percentage of their interest (common plus options) -- the routine sales one makes to cash-in and diversify after all these years of famine. Often, it's done just because momma is tired of waiting. Moreover, every one of the sales was made during a runup -- hardly signs of desperation. P/E Ratio: Ag's P/E is running about 56 against FY98 earnings estimates of proven-cautious analysts. It's running about 27 aginst FY99 estimates. (Excuse me for not calculating P/Es to two decimal places.) In the first place, it's misleading to apply normal P/E thinking to any company during its first several quarters of positive earnings. Blind use of P/Es in computer screening is doubtless one of the reasons Ag hasn't been "discovered" by many smaller funds. In the second place, high P/Es are the order of the day. Coke and Pepsi are both around 33. Is it really more likely that their earnings will double in 98 and again in 99, than that Ag's will? Cheers, John R