Friday, April 24, 2009

A Cheap Biotech

I’ve pretty much done with the arb plays. I’m just waiting for Nova Chemicals (Ticker: NCX) and Legacy Reserves (Ticker: LGCY) to close. I’m still targeting a mid May closing for Nova Chemicals and looking for a price boost in Legacy Reserves (probably ~ $15 per share). I’m still kicking myself for not jumping into Sum Total (Ticker: SUMT), which received a higher bid today.

I’m back to sniffing around some cheap value plays. One of my favorites right now is Genzyme Corporation (Ticker: GENZ). The stock just sold off hard on an earnings disappointment and retested its recent lows. The company has reaffirmed its numbers for this year. It’s a nice double bottom formation and all the bad news is out. The market should start to anticipate the eventual approval of the 2000 liter Lumizyme bioreactor, which should occur around the end of June. Once this happens, this stock will easily hit $70 +. On another note, activist investor Ralph Whitworth of Relational Investors has taken a 6.9 million share stake in Genzyme. This guy doesn’t mess around and will press management to maximize shareholder value.


At May 12, 2009, Anonymous Anonymous said...

Hi there, thanks for your mail. Pretty happy with my Pfizer position so far. I am sure you have already seen the good news. - Abu Dhabi state-owned International Petroleum Investment Co (IPIC) to buy Canada's NOVA Chemicals (approved May 12)
Have a looked at the Sun/Oracle deal? Might be interesting below $9. Hope you are doing fine, David

At May 12, 2009, Blogger Money Turtle said...

Yeah, it's getting closer to closing. It looks more likely that the NOVA Chem. deal will close end of May / early June. The remaining regulatory hurdles are Investment Canada and CFIUS. The 45 day waiting period for Canadian review should have been completed at the end of April, but with no news it looks like the 30 day extended review has kicked in.

At May 12, 2009, Anonymous Anonymous said...

Thanks for this important info. I have added shares at prices below $5.70. A really good risk/return ratio. Pls keep us posted, David

At May 28, 2009, Anonymous Anonymous said...

Well, we in Malaysia seem to be doing well we have high growth and high inflation. An example of inflation would be the local desert "cendol" bought about a month ago at the price of $1.20 in local currency would now sell for $ 1.80 in local currency. Job growth is also strong as we have 2 jobs for every worker and Malaysia imports in foreign labour to do jobs that local workers do not want to do. Hence our problem in Malaysia is now high inflation and good news, high growth.. We do not understand why the Western Media keeps on saying we are in a Recession. Yes our economy slowed down in March 2009 but after that period our economy is now experiencing high growth and high inflation thanks to China's strong buying of Malaysian goods and services, thank you China ! So please do not say Malaysia is in a Recession when it is not, only the US is in a Recession, the rest of the World is booming thanks to China !

At May 29, 2009, Blogger Money Turtle said...

To the last Anonymous post: Umm... Ok... Good for you, Malaysia and China.


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