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Latest Valuentum Commentary
Jun 14, 2021
Vertex Pharma Still Extremely Healthy Even After VX-864 Disappointment
Image Shown: Vertex Pharma has a huge net cash position on the balance sheet offering it tremendous financial flexibility. Image Source: Vertex Pharma. We like Vertex Pharma as our speculative biotech idea in the Best Ideas Newsletter portfolio, albeit as a small allocation. The company has solid revenue support with its treatments for cystic fibrosis, an extremely healthy net-cash-rich balance sheet, and tremendous free cash flow generating capacity as it advances its pipeline and grows its relationship with gene-editing firm CRISPR Therapeutics. As an idea within the context of a well-diversified equity portfolio, Vertex Pharma continues to make the cut. We still like shares.
Apr 21, 2021
Vertex and CRISPR Therapeutics Partnership Update
Image: Vertex Pharma is co-developing gene-based therapy for sickle cell disease (SCD) and transfusion-dependent beta thalassemia (TDT). CTX001 may offer a potential cure for people that have SCD and TDT.On April 20, Vertex Pharma and CRISPR Therapeutics issued a press release that noted “the companies have amended their collaboration agreement to develop, manufacture and commercialize CTX001, an investigational CRISPR/Cas9-based gene editing therapy that is being developed as a potentially curative therapy for sickle cell disease (SCD) and transfusion-dependent beta-thalassemia (TDT).” The development is a win-win for both Vertex Pharma and CRISPR Therapeutics and reinforces our positive view towards both company’s capital appreciation upside. We prefer Vertex Pharma as our speculative biotech play in the Best Ideas Newsletter portfolio given its more resilient financials and established commercial portfolio. Note that with early stage biotech companies such as CRISPR Therapeutics, investors are taking outsized risks and could lose all their capital should future endeavors not pan out as expected.
Feb 8, 2021
Stock Market Outlook for 2021
2020 was one from the history books and a year that will live on in infamy. That said, we are excited for the future as global health authorities are steadily putting an end to the public health crisis created by COVID-19, aided by the quick discovery of safe and viable vaccines. Tech, fintech, and payment processing firms were all big winners in 2020, and we expect that to continue being the case in 2021. Digital advertising, cloud-computing, and e-commerce activities are set to continue dominating their respective fields. Cybersecurity demand is moving higher and the constant threats posed by both governments (usually nations that are hostile to Western interests) and non-state actors highlights how crucial these services are. Retailers with omni-channel selling capabilities are well-positioned to ride the global economic recovery upwards. Green energy firms will continue to grow at a brisk pace in 2021, though the oil & gas industry appears ready for a comeback. The adoption of 5G wireless technologies and smartphones will create immense growth opportunities for smartphone makers, semiconductor players and telecommunications giants. Video streaming services have become ubiquitous over the past decade with room to continue growing as households “cut the cord” and instead opt for several video streaming packages. We’re not too big of fans of old industrial names given their capital-intensive nature relative to capital-light technology or fintech, but there are select names that have appeal. Cryptocurrencies have taken the market by storm as we turn the calendar into 2021, but the traditional banking system remains healthy enough to withstand another shock should it be on the horizon. Our fair value estimate of the S&P 500 remains $3,530-$3,920, but we may still be on a roller coaster ride for the year. Here’s to a great 2021!
Jan 24, 2021
Best Idea Vertex Pharma Is an Intriguing Biotech Play
Image Shown: A snapshot of Vertex Pharmaceuticals Inc’s approved therapeutic offerings and its drug pipeline. Image Source: Vertex Pharmaceuticals Inc – January 2021 IR Presentation. Vertex’s market leading position in the cystic fibrosis ('CF') therapeutics space underpins our expectations that its free cash flow will grow at a brisk pace going forward (supported by the potential for the company to expand into new markets and the potential to grow the application of its CF portfolio). We also like Vertex’s exposure to gene therapies via its partnership with CRISPR Therapeutics. Vertex’s existing drug pipeline is decent, and the biotech has the ability to use its net cash position to bulk up its drug pipeline even further if needed (through a strategic partnership, acquisition, purchase of drug development rights, etc.). Though we generally don't get too excited about biotech plays given their speculative nature, the difficulty in predicting the success of drugs in their pipeline, and the potential for shareholder dilution via new equity issuance, Vertex’s financial position is rock-solid, its outlook is bright, and we like having exposure to the company in the Best Ideas Newsletter portfolio.
Jun 1, 2020
June Dividend Growth Newsletter & Intrinsic Value Investing
"But how, you will ask, does one decide what [stocks are] "attractive"? Most analysts feel they must choose between two approaches customarily thought to be in opposition: "value" and "growth,"...We view that as fuzzy thinking...Growth is always a component of value [and] the very term "value investing" is redundant." -- Warren Buffett, Berkshire Hathaway annual report, 1992
Jul 9, 2018
Nelson: The 16 Most Important Steps To Understand The Stock Market
Image Source: Tim Green. We outline the '16 Most Important Steps to Understand the Stock Market.' We think it's important to take a read of these key stock market tenets when things are going great -- and perhaps even more important when things aren't going your way. This continues to be a working document.
Oct 12, 2017
An Overview on Valuing Junior Biotech Companies -- Does Clovis Fit the Bill?
The biotech industry remains one of the most fascinating yet perplexing industries for investors. Anecdotes of the entry-stage biotech with a home-run new therapy are often romanticized, but the reality is the vast majority of molecules fail in various stages of clinical testing. Due to the boom-bust nature of the industry, many are wary of investing in the space, and traditional valuation metrics are not as useful due to a large number of such speculative entities being in the pre-revenue stage. With this in mind, let’s take a glimpse into our thought process when evaluating upstart biotech companies.
Sep 22, 2017
Best in Biotech? Global Blood Therapeutics' Promising Treatment for Sickle Cell Anemia
Image Source: National Institute for Health. We remain impressed with the depth of research conducted over a wide host of disease states. Though a molecule may appear to hold significant promise in the pre-clinical phase, we have often witnessed the unique ability of the human body to react to various treatments. Often an unwanted side effect can torpedo a treatment, thus relegating millions of dollars of research obsolete. However, if a promising molecule is brought to market, the payoff is often well worth the effort. Our goal is to sift through the various clinical data to unearth the most promising treatments with the understanding that nothing is assured until the FDA authorizes the product for marketing in the US. We believe we have identified a promising junior biotech in the rare drug field with a promising treatment for sickle-cell anemia.
Jul 12, 2017
Analyzing the S&P SPDR Biotech ETF
Source: S&P SPDR Biotech ETF (XBI). ETFs are rapidly becoming the preferred investment vehicle to gain broad exposure to a particular sector. The biotech industry is no different with two distinct ETFs dominating the niche. The article discusses the unique characteristics of the SPDR Biotech ETF to determine the merits of the idea.
Jul 2, 2017
Prepared Remarks From Nelson Exclusive Conference Call June 30
Read President of Investment Research Brian Nelson's prepared remarks for the yearly roundup conference call, held for Nelson Exclusive members.
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The High Yield Dividend Newsletter, Best Ideas Newsletter, Dividend Growth Newsletter, Nelson Exclusive publication, and any reports, articles and content found on this website are for information purposes only and should not be considered a solicitation to buy or sell any security. The sources of the data used on this website are believed by Valuentum to be reliable, but the data’s accuracy, completeness or interpretation cannot be guaranteed. Valuentum is not responsible for any errors or omissions or for results obtained from the use of its newsletters, reports, commentary, or publications and accepts no liability for how readers may choose to utilize the content. Valuentum is not a money manager, is not a registered investment advisor and does not offer brokerage or investment banking services. Valuentum, its employees, and affiliates may have long, short or derivative positions in the stock or stocks mentioned on this site.