Bio-Tech Stocks You Don’t Wanna Miss - Part II
Current YTD Performance: -$2163
That was a great 4th of July weekend. Lots of food, new people, new restaurants, new everything. I just love San Francisco. Anyway, here’s the part II of the bio-tech stocks featured in Gene Marcial’s 7 Commandments of Stock Investing that you should consider investing in:
*NASD Biotech Index ETF - If you want to play it safer and avoid the volatility of investing in only one or two stocks, go with the option of NASD. It’s an ETF that is devoted to investing in biotech companies including Amgen, Gilead Sciences, Biogen Idec, and Illumina.
*Enzo Biochem (ENZ) - As one of the oldest U.S. biotech companies around the stock has ranged from $8 to $114 in the last nine years. The stock sky rocketed to $114 before the dot com burst in 2001 due to its technology oriented researches. However, the stock took a downfall thereafter and is now at $11.20.
What’s interesting about this biotech firm is that it has a ton of cash on its balance compared to many other biotech firms that are strapped for cash. It currently has several endeavors including Phase II clinical trials for Crohn’s disease treatment and HIV infection treatment. If any of these trials post a positive result, the stock should soar up to the 30s according to the biotech analysts.
The firm also faces 4 patent infringement lawsuits presently, and if it wins any of the lawsuits, the stock should see a positive trend. There are believers in this stock such as JPMorgan Chase, Vanguard Group, and Citigroup who all have a significant stake in this company. As I know from my experience in pharmaceutical industry, you must be patient with these stocks since the “New Product Development Projects” could span up to 7-8 years due to its extensive trials and approval processes.
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So the portfolio value went down further again on Thursday before the long weekend. I invested $5000 in the newly introduced IPO for the company called Enegery Recovery (ERII). It is one of the only IPOs in the recent months where the first day posted a gain from the introductory price of $8.50/share. This company markets an energy recovery device that saves companies up to 60% energy during the sea-water reverse osmosis process.
Energy Recovery earned a profit of $947,000 on sales of $9.1 million in the quarter ended March 31. Most of its sales have come from outside the United States. Given the current environment we’re in, I think companies invested in saving energy will go a long way, especially like ERII that is growing rapidly with its patented technology. I don’t think this is no Visa (V) IPO opportunity, but I’m willing to take the risk.
