I hope everyone had a wonderful Christmas. As a gift of sorts to celebrate this season, let me offer to you my Stock of the Year for 2012.
This one was recently new to my radar, but the more I read about it, the more I liked it. I’ve been nibbling a little bit and have opened a small position. It is small enough that it will not hurt if the stock retraces 30% or more (as these tend to do). I plan to buy a little on the dips, patiently.
The important caveat is that I’m not typically investing/trading based on fundamentals as fundamental analysis is not my forte. I can tell you the company has a lot of debt, but that is normal for a biotech. This pick is a combination of my belief that the technology could literally change the world and an understanding of what happens when stocks exhibit a technical pattern that this one is exhibiting. In other words, it is a combination of hope and technicals and a little bit of intuition.
Why hope? Should the company actually be able to develop the product, they plan to be able to test for various cancers using a simple anti-body based blood test. The test could be administered during routine visits to the doctor’s office. Not only would the technology be life saving, but think about the number of tests that would be administered. The oncology diagnostic market is estimated to reach $8 billion by 2014.
Techinically speaking, the stock has surged off of new lows on huge volume, gaining almost 60% over the past 7 days. These types of surges usually result in big pullbacks of 30% or more following the surge, but some of these types of moves lead to the stock making substantial gains over the next 252 days. The surge is a sign that something has changed. The key is to understand that volatility will remain elevated and to not take on a big position right away.
The company is Bio Time, Inc.
I welcome hearing your thoughts about this company. Since I’m not skilled at digging through financial statements and 10Qs, perhaps I’ve missed some red flags. At iBC, we’ve never been shy about classifying biotechs as hand grenades just waiting to blow off your arm, or more. No risk, no reward. With biotechs, the rewards can be huge, and that is why this is my stock of the year for 2012.
The surge is due to Maudlin’s newsletter pumping it.
Nah, I just checked Mauldin’s letters. He had a guest write about it on December 20th. It was called “Catastrophic Success” and was written by Pat Cox. The surge started on December 16th, when BTX published the news on their new technology.
It looks like the newsletter went out at 2:30 on the 20th. BTX was already up 14% for the day at 2:30.
Thanks for bringing that to my attention! Its good to have Mauldin on board.
I have followed a similar stock called PPHM. Whenever there is some news about their clinical trials, stock goes up. Success percentage with these companies is extremely low. You can buy amgen or gilead and pray everyday, you will get at least your money back.
I think you got your answer today. Do what Fish says and pray for amgen and gilead if you really must gamble with biotech.
Colonel, what answer today? I’m not sure what you are talking about.
Didn’t Mom teach you not to play with pinless hand grenades?
Ah, no guts, no glory. When you are going for stock of the year, you’ve got to pick one that could be a game-changer.
Mauldin always leaks his “picks” before his news letter and the guy he got that “pick” from is a total penny stock pump and dump fraud if you check his website. I don’t know anything about that stock or story but I’d for sure check to see if Mauldin was compensated for the pump he gave it. That promote who is pumping that stock looks like a fraud promoter to me.
I’ll run a few numbers for you. On first glance, the numbers look horrible. However, that’s not really the full story here I guess.
Yeah, the numbers looked bad to me as well. Would appreciate your further thoughts.
“could literally change the world”
I can’t remember any biotech that has ever done this.
“they plan to be able to test for various cancers using a simple anti-body based blood test. The test could be administered during routine visits to the doctor’s office. Not only would the technology be life saving, but think about the number of tests that would be administered. The oncology diagnostic market is estimated to reach $8 billion by 2014.”
there is something wrong with this statement, I just can’t put my finger on it. maybe because I have heard this before but for a different ticker.
jon, don’t know if you’re serious or not, but your comment is humorous. I’m sure there have been hundreds if not thousands of biotechs that were going to change the world…Perhaps this one will actually do it.
The statement you quoted was from me paraphrasing from BTX news releases and from my own speculation.
I don’t like a 1/1000 chance. A quick google search already shows evil short sellers conspiracies against BTX. http://www.fool.com/investing/general/2011/05/05/the-bearish-case-for-biotime.aspx
Can’t blame you jon.
Perhaps everyone can come back next December and give me a good virtual beating for picking this one. We’ll see!
The original article on Biotime… March 2011
Brief analysis of the numbers