Wednesday, April 9, 2014

Regeneron (REGN) Update

I almost became a proud owner of Regeneron (REGN) stock yesterday (April 8). I have watched Regeneron for a long time. It's Eylea therapy for macular degeneration has been ramping revenues steadily, and I like its platform and pipeline. But other investors like its prospects too, resulting in a high P/E ratio. I am cautious about high P/Es, and for good reason. If anything goes wrong, the stock price can plummet.

As I wrote about Regeneron, resulting in Regeneron Down 15% From 52-Week High: Buy? published late today at Seeking Alpha, I was reminded of the good side of REGN. When I started writing the article REGN was down almost 20% from its 52 week high.

I decided to buy a few shares. It fell quite a bit on Tuesday. So I postponed. I figured I could get it even cheaper on Wednesday. What I really like is a stock that should have a high P/E that investors have overlooked, resulting in a mediocre P/E.

Alas, when I checked REGN about 1/2 hour after the market opened today, it was up around $10 per share. Regeneron ended today at $306.26, up $19.82 in one day, and up 6.92%.

Not that I had a bad day. The top stock in my portfolio for the day were Inovio (INO), up 11.8%. But Inovio has not received FDA approval for its therapies yet, and is notoriously volatile. Not recommended for amateurs. Second up was data storage system maker Dot Hill (HILL), up 8.42%. Of my larger cap stocks the best was Celgene (CELG), which was up 6.6%. Celgene has been hit by both the recent Biotechnology deflation and by specific worries that its Revlimid may go generic sooner rather than later. However, today a look at the patent case preliminaries convinced many investors that Celgene's patents are solid. I also would point out that Celgene has a great pipeline that should start kicking in long before the Revlimid patents run out.

Hope you had a good day too. Keep diversified!

You can see my notes on the analyst conference calls of all these stocks at OpenIcon.

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