About two weeks ago I told you biotech needed to be slaughtered. Lo and behold, ever since then, the sector has been under pressure–with some names down more than 25%. The overall industry is off by almost 8%, led to the downside with names like ISIS, AMGN and SGEN.
Truth be told, there isn’t value in the biotech space, as the vast majority of these stocks are trading at absurd levels. But, judging by the risk appetite of traders, they’ll probably circle back to the industry soon, especially since the human species is a depraved one.
I like ISIS, ICPT, SGEN, JAZZ, AMGN and GILD here.
Today’s big story wasn’t the sell off. It was oil trading higher and yields dropping lower. Names like SLCA and FMSA, both current longs of mine, are raging to the upside. I do not like the underlying fundamentals of the oil trade. It’s too soon to believe the pain in the industry is over.
In summary, you should expect a bounce in biotech, book profits in oil, and prepare for general strength to combat this bullshit we’ve been getting the past two days–kicking the monsters who’ve working against you right into the fucking center of the active volcano.
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You better pray we don’t break down. If we do next stop 200 day.
Agree with everything you said, expect that GILD really has value here, especially as compared to its peers. P/E is below 14, PEG below 1, massive amounts of free cash flow, and barely any debt.
Did not someone recently die taking the wonder drug? The belief in biotech has become religion.
I think M and A and anticipation will support many of these spec stocks. Take ADXS. Has a cure for CA of the rectum…damn near killed him! Who wouldn’t want a cure for that badboy. I’m using a basket approach and not daytrading.
Holding my Canadien oils here and stalking the sand frac plays again on any weakness. Not sure anyone really thinks oil will break Cramer’s line in the sand of 42-43…would love to see what happens if it does…
I’m thinking the transports ought to be good…