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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: jeffbas who wrote (5898)	1/27/1999 8:07:00 PM
From: jeffbas	Read Replies (1) \| Respond to of 78495

Here is a misnomer for this thread - a small biotech "value" stock -- GZMO ($2 1/2): -This is a stock that tracks (like the old GM class E stock, for example) the performance of the described business units that are part of the $4 billion market cap parent company GENZ. Company has access to capital and resources of parent company like no other small company its size in its field, so if they make progress will probably not face running out of money. It is not an independent company. -Current market cap is something like $30 plus million, which is mispriced if the research initiatives and business make any sense. Probably a lot of selling by institutions who got this stock last fall as a dividend on GENZ helped knock it down from $8 to 2 ($15 12 months high is wrong), since many such institutions probably can't hold such a stock. -The parent company in structuring this company retired all the significant outstanding debt related to the sub's businesses by issuing stock at a stated value of $6+. -The FDA now has a fast track strategy for cancer drugs, which in effect makes cancer research a more attractive field relative to ROI. -The collaborations with companies and research institutions are top rate. My daughter just got a PhD in cancer research and says they are working where the action is. I have never considered small biotech companies because all they do is burn money. This is no different in that respect except it seems to cover an awful lot of bases in an important area, with a corporate structure that seems to offer a good shot at realizing the benefits of its research if successful - and a very low valuation. Thus, this is the only microcap biotech I have ever seen fit to buy, at current levels. Anyone interested should read the 4/98 S3 at GENZ on EDGAR (very complete) and all the sections of following GENZ 10Q's relating to GZMO. My view is that at this market cap ANY material announced success will deliver a 3-5 bagger.