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Biotech / Medical : Ligand (LGND) Breakout! -- Ignore unavailable to you. Want to Upgrade?

To: Arthur Radley who wrote (11603)	11/23/1997 8:56:00 PM
From: Russian Bear	Respond to of 32384

*Off Topic* Hi, TD, I have only had time for a very quick look at PPD, but I already do not like what I have seen: 1. PSR = 8 2. P/E = 40 3. P/Book = 10 4. Revenue growth is too high at 40%+ (unlikely to be sustainable.) 5. "Funny" accounting is usually only "funny" if you are short. ;-) 6. Insider selling filed with the SEC on 11/6 and 11/7. 7. Pyramids make me suspicious (even when they aren't flagrant Ponzi schemes.) On the positive side: 1. Operating margins are very healthy. 2. Cash is high; debt is low. 3. This doesn't appear to be a blatant Ponzi scheme (although, the mere fact that it is a pyramid, at all, is enough to make me wary.) Based on the above, I concur with you: PPD is a worhty short. Two caveats: (1) Like I said, I have only had time for a cursary look. (2) PPD looks like it has had a pretty good run in 1997. Therefore, for tax reasons, this "full grown puppy," as you aptly termed it, may experience a strong December (few willing sellers,) only to plunge in early January (pent-up selling pressure.) Not all stocks exhibit this pattern, but I know from my own experience that this consideration absolutely does enter into the "when-should-I-sell?" equation. By the way, if you are in need of yet another short -- and congratulations on your big ZITL win; I was rooting for you ;-) -- have a look at CDRD. Long term, it is every bit as bad as Zitel ever was! The same caveat applies: CDRD has appreciated 6-fold this year, so the sell-off may not happen until January (unless, of course, it crumbles under its own weight before then.) Any entry above 20 or 21 is free money, IMO. Best regards, RB