written by reader Bio Stock Rating/Grading volume 1

By xiexgp@gmail.com, November 13, 2014

Many people on the main Bio/KSS threads think that maintaining a rating/grading system for Bio stock is a good idea. FWIW This thread aims to provide them with the space to indulge in such practices.

Long Gild and KSS.

This is a discussion topic or guest posting submitted by a Stock Gumshoe reader. The content has not been edited or reviewed by Stock Gumshoe, and any opinions expressed are those of the author alone.

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Lulu
5 years ago

GILD had a sell signal Nov 13, 2014 MA 10 crossed over MA 20 dowwwwwn. Was my assessment correct Allan?

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Alan Harris
Alan Harris
5 years ago
Reply to  Lulu

If it went down……you must be right I guess…. Gild closed $107 on nov 13…..it hit $101 14th Nov. Nuff said?

sandiegojp
5 years ago

Re: GILD
I hope I’m not being rude by interjecting. I use a 22- and 50-EMA. I did notice that on that date, both EMAs flattened indicating a possible lack of forward momentum. Furthermore, on 11/5, the fast MACD line crossed under the slow line and began to trend down. Additionally, on the same date, MACDH dipped below 0 and trended down. All signs (as I understand them) of an impeding lack of forward momentum. That day, there was a “wide” price range and the Close was very near the day’s low, another sign of weakness. The next day was a pivot point as the close was at the open and the range was much smaller than on 11/5 on almost as much volume.
Of course, it’s easy to read the “tape” from the right side and, for the record, even though I was monitoring this, I didn’t follow my own advice and held. For the record, also, the daily chart seems to indicate a continuing downtrend.
This is NOT a recommendation to BUY/SELL GILD. Full disclosure: Long GILD.

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Alan Harris
Alan Harris
5 years ago
Reply to  sandiegojp

Rude??? Not at all ! People choose to subscribe here, so no one can can complain about TMI.
Why 22/50….what does persuades you to use the extra 2?
BTW There is no such thing as a recco on GS…..only one person decides to sign the check and thats after however much DD they bother to do from ALL the info to available. Th only thing with a crystal ball is a crystal statue.

Alan Harris
Alan Harris
5 years ago

Opps….Even I screwed up. This is the KSS bio grading thread…..I think these comments should be on the technicals thread. See ya there.

Alan Harris
Alan Harris
5 years ago

All: If anyone wants to send a jinglebells greeting to KSS…heres the place http://www.stockgumshoe.com/2014/12/microblog-happy-christmas-dr-kss-from-all-us-gummies/

Alan Harris
Alan Harris
5 years ago

It seems the KSS rating system has reared its head again. Seems to me there is presently no consensus on what we want vs what can reasonably be expected/maintained. So, I throw these thoughts in the ring for your comment.
The ONLY assessment I (and most others ) are interested in is KSS’s. I truly dont think he has time for too much detailed price/risk analysis (but we can ask). Seems its far more likely that he will give an educated gut feeling about a stock ‘IF’ he owned it. Presently he has taken to saying ‘Long with a buy sentiment’. (or whatever is appropriate). Naturally it would be fab to have endlessly more analysis, but Im not sure we can reasonably expect more than this. However, there are two things I would love to know, and thats a risk assessment ratio and a binary event flag.
Risk: I think this means risk to your capital investment rather than scientific risk or whatever (though the end result will probably be much the same) One particularly dangerous thing is an investment in a ‘binary event’ stock coz its bound to end up in Heaven or Hell. I mean, if Glaxo invest in a bad drug youll probably lose 5%……wheras Regardo’s much fancied one an only drug was a 99% wipe out. So we get a ratio of say 95/100 for Glaxo and 5/100 for Regardo. (scuse my math coz Regardo might be seen as 1/100000 ratio… I leave that assessment to KSS !) Armed with this, at least we know the risk we are taking on in return for possible Nirvana……or as Dirty Harry would say ‘What you gotta ask yourself is, Do ya feel lucky punk?’.
I think we could add one thing to this. As time goes by and ‘news’ emerges, KSS may have a change of heart. How will we know what he said previously? I would suggest a simple +/=/- direction indicator. These will equate to a current sell/hold/buy rating and indicate movement from a previous feeling as impacted by latest events. So a rating of 50/50 – means that its medium risk (to your capital) but getting worse. Or 50/50+ means its even money but things are looking up in my (KSS’s) opinion. ETC.
One other thing is whether the stock is a buyout candidate ie Y/N.
These codes could easily be added to the spread sheet as a column.

Your thoughts guys? But do try to remember that someone (You????) needs to maintain the spread sheet.

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lulu
lulu
5 years ago
Reply to  Alan Harris

Like, Like Like!!! and thanking you Alan.
One spreadsheet, remove info which is no longer pertinent/suitable or is searchable via our trade platforms to make room. KISS, keep it simple stupid. Great brainstorming.
LONG KSS
Pleased to help if I can.
my .01 CDN

seeking_that
5 years ago
Reply to  Alan Harris

Hi Terry, Alan, Dan & all,

Please do not mind me extending this discussion further if this, in the process, could give us a good evaluation system.

I agree that this system should not be a burden on Dr KSS and team doing analysis and there should be an easy way of providing biotech indicators based on which a company is assessed.

Since this evaluation system is specific to biotech sector I would suggest biotech indicators that would be easy to assess, easy to update, most importantly intuitive and shouldn’t need extra work to be done.

Where there is no information available defaults can be taken. The defaults would be replaced with actuals when further information is available.

Biotech indicators could be derived from the articles or from the comments. It needn’t be realtime. Changes could be incorporated upon periodic reviews and suggestions provided thereupon

Spreadsheet would be based on biotech indicators suggested earlier and to clarify the positioning on a symbol, a “sentiments” column could be added:

Sentiments
Promising – companies with high growth, acquisition, merger
Growing – revenue generation
Hold – sustains
Speculative – has potential
Binary – indeterministic
Sell

If the group feels it is workable I will take a initial stab and it and send out spreadsheet for review.

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Alan Harris
Alan Harris
5 years ago
Reply to  seeking_that

Seeking…..Honestly, I can see you are v keen and thinking hard; its truly appreciated. But who is gonna make these assessments?…….how will I know theyre not just know-nuffing pumpers if they are not KSS? Does KSS have the time/ inclination for this level of analysis…..he’s probably quite busy saving lives. Perhaps we should ask him directly about what HE is prepared to do. Ive said what I would like….. maybe submit a wish list tick list to him and see what comes back.
Still, nice of you to volunteer to maintain whatever emerges from this debate. Personally, I still think it has to be KSS keeping it KISS.

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seeking_that
5 years ago
Reply to  Alan Harris

Hi Alan,

Sure KISS is good .. just wanted to create a list of companies recently discussed

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frankw17
5 years ago
Reply to  seeking_that

seeking_that, I would certainly like to see you take a first shot at this approach. Hopefully,
we can mold it into a working document that would be beneficial to the majority of those
of us interested in investing in biotech. The message as you are well aware of is to ensure
simplicity.
Regards,
Frank

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seeking_that
5 years ago
Reply to  seeking_that

Hi All,

Here is the list of stocks (listed in biotech dim sum) in the increasing order of risk. Please suggest if this format will be work and any changes to make it useful. I hope the information would be useful if corrected wherever there are deviations


Stock   -  cash - trials - Science - Perform - Mgt - Outside - Rating -    Reward -  Trailing - Sentiments
                                                              Triggers               Stop %
                    (0-3)  (0-4)    (1-4)     (0-4)     (0-4)  (0-3)

TMO        3      3        3          3         3       3         18(E)        Med    25 %    Growing
LLY          3      3        3          3         3       3         18(E)         Lo    25 %    Growing
GILD       3      2.5      3          3         3       3         17.5(E)    MedHi    25 %    Growing
CELG       3      2.5      3          3         3       3         17.5(E)       Hi    25 %    Growing
NVS         3      2.5      3          3         3       3         17.5(E)    MedHi    25 %    Growing
GWPH     3      2.5      3          3         3       3         17.5(E)       Hi    25 %    Growing
BLUE       3      2.5      3          2         3       2         15.5(F)      Med    20 %    Promising
KITE        2      2        4          2         3       2         15(G)      MedHi    20 %    Promising
JUNO      2      2        3          2         4       2         15(G)      MedHi    20 %    Promising
AGIO       1      2        3          2         3       2         13(F)         Hi    20 %    Promising
BLCM      1      2        3          2         3       2         13(F)         Hi    20 %    Promising
CTIX        2      1        3          2         3       2         13(F)      MedHi    15 %    Speculative
BLRX       1      1.5      3          2         3       2         12.5(F)    MedHi    15 %    Speculative
ESPR       D      2        3          2         3       1         12(F)        Med    15 %    Speculative
KPTI        D      1        3          2         3       2         12(F)      MedHi    15 %    Speculative
EPZM       2      1        3          2         2       2          12(F)       Med    15 %    Speculative
ZFGN       2      1        3          1         3       2         12(F)        Med    15 %    Speculative
TLOG       D      1        4          1         4       0         11(F)         Hi    15 %    Speculative
XENE       1      1        3          2         3       2         11(F)         Hi    15 %    Speculative
ARWR      D      1        3          2         3       1         11(F)      MedHi    15 %    Speculative
AKAO       D      2        4          D         3       D          10(Av)     MedHi   15 %    Binary
TRVN       0      1        4          2         3       0          10(Av)        Hi   15 %    Binary
BIOZF      D      1        4          D         2       D          10(Av)        Hi   15 %    Speculative
CLDN       D      1        4          1         2       1         10(Av)      MedHi   15 %    Binary
AKBA       D      1        3          D         3       D          10(Av)     MedHi   15 %    Binary
ATNM       D      1        3          D         3       D          10(Av)     MedHi   15 %    Binary
HALO       D      2        4          D         D       D          10(Av)     MedHi   15 %    Speculative
ALKS       D      1        3          D         3       2         10(Av)      MedHi   15 %    Speculative
TRIL        2      0        4          D         2       0          9(Av)        Hi    15 %    Speculative
Benitec   1      1        4          1         1       1          9(L)         Hi    15 %    Binary
ARTH       0      0        4          1         3       0          8(L)         Hi     5 %    Binary
Legend:
Cash: 0 - debt; 3 - no debt, sufficient cash flow
Trials: 0 - pre, 1 - p1, 2 - p2, 3 - p3, 4 - approved (averaged out across product lines)
Science: 0 - not fully understood, not fully convincing, 4 - fully understood and convincing
Consistency: Market Performance; 0 - least; 4 - best
Management: 0 - unreliable & unpredictable; 4 - totally reliable & predictable
Triggers: 0 - no triggers or negative triggers; 3 - positive triggers or no negatives expected

Rating:                        Risk
E  - Excellent ( >= 16) -      Low
G  - Good (13 - 15)     -      Low-Medium
F  - Fair (11 - 13)     -      Medium
Av - Average (9-10)     -      Medium-High
L  - Low  (< 9)         -      High

Trailing Stop Recommendations:
Rating           Suggestion
Low                 5
Average            10
Fair               15
Good               20
Excellent          25

Sentiments
Promising   - companies with high growth, acquisition, merger
Growing     - consistent revenue generation
Speculative - has potential
Binary      - indeterministic
Sell

Defaults: = 1 for all fields since we are considering  biotech startup
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Alan Harris
Alan Harris
5 years ago
Reply to  Alan Harris

Of I forgot to mention: A next ‘event’ timespan (ie not much will happen till july 2018) would be excellent.

Howard
Howard
5 years ago

If we are going to have an evaluation rating one factor needs to be an understanding of value:
Overvalued
Fairly Valued
Undervalued
Back up the truck!

Alan Harris
Alan Harris
5 years ago