Genetix Grp Share Discussion Threads

[cat] 29/12/2000 10:59

Dil: yes, bought 50k prm day before yesterday.Bought some more GTX and WHM today.

[dil] 29/12/2000 10:39

CAT : you finished digging yet ?

[the prophet] 27/12/2000 11:42

CAT
-correction
-Molecular Sensing is quoted on the Ofex market(too much Xmas spirit....!)
-they have stated their intention to move from Ofex, probably 2nd half of 2001 and probably Aim
-TP

[cat] 27/12/2000 11:15

Prophet. Thanks a lot. Like the look of PRM in spite of losses - famous last words! Will do some more digging.

[the prophet] 27/12/2000 10:40

CAT
-Whatman look interesting, but their DNA purification business is losing money, as to be expected of a new business
-making some assumptions on the filters/membrane side, the DNA purification bit has got a value in the region of £150m or so
-so don't rule out loss making co's
-i'm also very interested in this sector
-particulary like:

-Molecular Sensing, DNA dtection, good article on Sharecast.com, market cap. around £35m,quoted on Aim, patented technology just about to go on sale. V interesting alliances with various co's, including possible tie-up with Apple Computers

-Proteome Sciences-good thread on ADVFN/E*Trade/iii

-Oxford Glyco-look interesting ,but perhaps a bit pricey, especially compared to PRM

-these are companies that i see a 'bio-infrastructure' co's and could do really well
-also like WHM, just would like to buy it cheaper!

[dil] 27/12/2000 10:33

I'll ring later.

Dil

[dil] 27/12/2000 10:26

End of thread , CAT's woke up.

See

Dil

[cat] 27/12/2000 10:24

Blimeeeeey - beat you to this one by 60 seconds. Mine's a lemonade - too much Cissac '82 last night.

[dil] 27/12/2000 10:23

What took you so long , thought you were still in bed :-)

Dil

[dil] 27/12/2000 10:22

CAT , when you wake up , what do these do ?

SCSW like them so I got a few .

Dil

[cat] 27/12/2000 10:21

I'm copying my contribution to the Whatman thread as it summarises what could be about to happen to this sector.

If anyone has any other ideas - ( THEYMUST BE COMPANIES MAKING PROFITS, NOT PROMISES) , please add. The market is now unforgiveable to stocks that are hyped on promises but fail to deliver, like many of the Biotechs.



Just this last week in my company we have heard of several studies due to start in the new year involving Genetic profiling, two of which involve 500,000 tests. The future of the pharmaceutical industry will be dictated by genomic profiling as point-of-care genetic diagnositics tell the precriber which drug is most likely to work in which patient. This next 5 years will see an increasing surge of such testing as first the R&D side and secondly, the commercial side of industry gets involved.
Much the same as the telecoms, Y2K and Internet gold rushes, as scsw has already pointed out several times, its the "picks and shovels" where people will make money. Whatman and Genetix are my two favorites, as they both make profits and are pure plays on this sector.
The market desparately needs an emerging star of a sector to help it out of the Doldrums, and Genomics may well be it.


Some summaries from SCSW:

Genetix - robotic gene discovery technology systems as well as other related consumables. Clients - large pharma, including AZ and GSK. Profits from £846k in 1997 to 3.1m in year to Dec 31. Gross margins from 38% to 53%.

Whatman: Patented DNA purification and storage techniques - New divison Whatman Bioscience just created with £5-8m sales in first year, forecast to grow to £100m in year 4. Profits this year 31 Dec forecast to be 7.5p eps - could grow substantially if the Bionscience division kicks in as forecast.

Here's hoping for a new Baltimore!

Regards, CAT

[muchos wonga] 06/12/2000 17:18

I see the price held up until 4pm when suddenly it went into reverse. Pump and dump?

Watch closely if you are long. IHMO

[joe soap] 06/12/2000 09:42

Well, it's been fun. I see that I'm not the only "small" investor who got scared and ran with their profits after the 333K sell. The price stayed stable considering, and probably has further to go, but I guess my nerves are a little frazled at the moment. I concur with Meg...the price may be stalling, but I'm happy. As I said, it's all about keeping a happy balance between buys and sells, and 333K is not a happy balance. Unlike the Minmet threads (if that's what they can be called), it's been very informative. See you all at the next IPO.

[joe soap] 06/12/2000 08:50

Very interesting opinions here, however as was mentioned earlier, this is in the mean time a momentum play and a strong one at that. With the markets racing ahead as they are, in anticipation of the US re-rating it's stance on economic policy to "neutral", and Bush probably leading the way into the White House (as I mentioned 3 days ago), my guess is that immediate fundamentals will not count as strongly in the very short term. Long-term they're vital of course, but in the mean time the company is profitable, and in this kind of market that's a big plus. In spite of the continuing share price rise, the p/e is still acceptable. Remember this, that we're in the market to make money out of share price movements, not to love each share we invest in. That's the focus, and for now the demand for a profitable biotech company in what is expected to be an enormous market in only a very few short years, outstrips supply.

[muchos wonga] 05/12/2000 23:03

Frau,

Meg is right. Although GTX do also make some hardware where OGS and PRM don't. PRM however have the key to being the market leader in biochips by the patent they hold on DNA tagging (see the interims for details). The CEO is very excited about this and has gone on record that they will be the market leader in a market worth $200m this year but $11Bn in five years time. Do the sums and you will see the when GTX is just starting to bring products to market, PRM will be pulling in a large share of the genetic/proteomic cash pile that the biotechs are now sitting on (including a lot of GTX's money)!

[mj thomson] 05/12/2000 23:00

Muchas Wonga
Apologies, it was in fact citywire and not sharecast that tipped GTX. You are much more knowlegable about the genomic sector than myself, hence I don't feel in position to comment on the relative merits of investing in GTX rather than OGM or PRM. But I can comment on SCSW's comments. SCSW are bullish on GTX as firstly they believe the sector is likely to be one of the major winners next year. Secondly they appear to be bullish on GTX in particular because they are a 'small' company, which I believe OGM and PRM are not. Thirdly it makes a profit and has a p/e of around 40, which is not unreasonable given the sector(although this has obviously risen over the past few days).

PS Their final comment in the article was "the shares look likely for a warm reception when dealings start on 29/11/00" - certainly true.

I hope this helps,
Matthew

[megryan] 05/12/2000 21:20

frau,

Yes...but PRM and OGS already have the picks & shovels and are years ahead of GTX. Just go to each website and see for yourself.

Meg

[frau] 05/12/2000 18:38

Isn't it the biotech version of selling picks and shovels to the goldminers?

[megryan] 05/12/2000 17:24

Muchos,

I too agree with your evaluation and comparison of GTX with OGS and PRM. GTX has at best to be a stag play. With hindsight I wish I could have made a quick buck on GTX and I am surprised at its strong performance...part of this must be portfolio balancing and hype over the newcomer's appearance. My advise for those into GTX who are now sitting on a profit would be to take profits at the slightest hint of price stalling.

OGS & PRM are much closer to market with their products, with PRM the most undervalued. These are the ones to go long on.

Meg

[muchos wonga] 05/12/2000 11:17

In response to MJ's reply:-

Ah ha!

Then my original comment that it may not be undervalued on fundamentals but may be overvalued on comparisons may hold water then. (It was also covered on www.citywire.co.uk by the way)

I think the biotech sector is undervalued as a whole (see FT suplement from 17 November) and out of OGS, PRM and GTX, PRM probably is the most undervalued.

I don't want to give anybody the impression that I am de-ramping GTX, I'm just researching/analysing the company and in terms of fundemental valuations it may be a good long term play. I am of course (slightly) ramping Proteome Sciences but that is because I have spent a lot of time researching it and have quiet a lot of money invested in it and the market is only just starting to spot what I and others already know, without having to have found it via a tip from RHPS et al.

Does anyone have any knowledge of the anticipated sales of GTX's machines which would give a clearer view of the future cash flows. It had something like £7m of sales last year; is this due to increase exponentially or is it fairly static?

Muchos

[joe soap] 05/12/2000 11:06

Muchos, I'm not as knowledgable about the (proteomics) sector as you evidently are, so I appreciate your input. As for valuations and a momemtum play - you could well be right. I don't have finer details of research available, but as you say, the ducks may be quacking which could be the reason for the price rise. But it seems I'm not the only one who thinks there is current value here, if what MJ says is true. As for deducing buys are coming - needless to say I have no hard facts, I was simply interpreting what the MM's were doing with the price, relative to it's movement. Call it a hunch that is/will continue to pay off.
Cheers,
Joe

[mj thomson] 05/12/2000 10:49

Was tipped in
1. Sharecast.com
2. Small Company Sharewatch Newsletter

Might have something to do with it

Matthew

[muchos wonga] 05/12/2000 10:46

Joe,

Sure, I wished I'd bought loads of stock at a price lower that it is currently.

However compared to other stock in the sector, this is looking expensive especially as it is years from any marketable discovery. There are companies in the same field which have been working in Proteomics for many years and have several valuable and marketable products NOW.

Why is a new company valued more highly than one which has been through the research phase? I've asked around and nobody who is keen on the company (ie owns stock) seems to know exactly what they do and/or how they have arrived at a judgement on what a fair market cap should be.

I suspect many people were aware of the company before it floated (I wasn't) and are now buying because they see the price going up as if that is confirmation that someone knows something about the company that they don't.

OGS has taken a 50% dive in the last few weeks, partly because of bad luck (on some market timing) but mostly because NASDAQ biotechs have taken a hit. Some people considered OGS to be a wee bit expensive before, but that view is being reversed as the price comes down. I can't recall the market cap of OGS but think it is somewhere in the region of £500m which would value GTX at more than one third the value of OGS. This must be way over the top.

I still hold the view that the market cap of this company should be in the region of £50m to £75m if it were to be compared to its peers. It may have made a profit in the past but now it researching Proteomics, it will have comparative cash burn to its peers and will make a loss. Buying at these prices will surely lead to disappointment as there is going to be no positive newsflow for 2-3 years at least.

I'm not sure how you deduce that there is a big buy coming. I just feel that the ducks are quacking so the MMs are feeding them.