What is this, like three reader requests in like three weeks? Oh boy everyone, NELLY’S FINALLY HIT THE BIG TIME. Where are my green m&ms, helper type person? DON’T YOU KNOW I ONLY EAT THE GREEN ONES? I WILL HIT YOU I SWEAR TO GOD (flips over table).
If you’d like your investment related question answered on this here blog, just go up to the contact me tab at the top of the page and send me a little note. I have a couple more questions in the queue, but I’ll get around to yours eventually. It’ll be magical.
ONTO THE QUESTIONS:
@financialuproar Nelson what’s your take on GUD?
— Doug Hartfield (@zaba998) May 5, 2014
How awesome is Doug’s profile picture, btw? Extremely awesome or TOTALLY AWESOME?
GUD is Knight Therapeutics, a company formed when Endo Health Solutions acquired Paladin Labs in late 2013 for $1.6 billion. Paladin’s co-founder – Jonathan Ross Goodman – decided to not continue working for Endo after it acquired his company. So they agreed to spin out this new company, which would have just one product, a drug that treats Leishmaniasis. I have no idea what that is either.
The stock listed on the TSX Venture exchange in March, graduating to the TSX in late April. The stock is off about 10% since making it on the TSX, but is still up more than 20% over its IPO.
It’s not exactly the kind of beaten up contrarian type of investment we look at around here, but it’s got some pluses going for it. The CEO built Paladin into a company which got acquired for a boatload of cash. More than 12 million people around the world have Leishmaniasis, which are really scary looking skin sores people get after being bit by infected sand flies. It’s particularly prominent in India, along with parts of Africa, and the southern part of Asia.
The company just raised $175 million and has a few products in its pipeline. It has one drug that’s been approved by the FDA for treating that weird skin disease. It’s looking for more drugs to acquire. And that’s it. It’s so new that it doesn’t even have public financials. Analysts don’t cover it. It’s just an investment in Goodman, a guy with a great deal of success at his previous company. Certain guests on BNN have called it a top pick too.
But for me? Yawn. IPOs don’t really excite me. It’s easy to see the bull case in this one, since the guy who is in charge of Knight just sold another company for more than a billion dollars. But what if he gets hit by a bus? It’s not a beaten up company. You certainly can’t argue there’s value there. I’ll pass, but that doesn’t mean the investment doesn’t have potential.
@financialuproar any thoughts on urthecast as a stock pick? looks like a good time to buy…
— Twiter (@fuckthetwiters) April 30, 2014
Well, that’s an outstanding Twitter username if I’ve ever seen one. COVER THE EYES OF THE CHILDREN.
Urthecast is a company that built a ultra high definition video camera that orbits the earth attached to the International Space Station. This data can be used by weather monitoring companies and broadcasters, who would use the feed to look at clouds or to (I’m assuming, anyway) stream it directly onto your cable TV. I’d watch the Earth from space, at least during the intermission of the hockey game.
The company has just shown investors first pictures from space, but I couldn’t find a date when they hope to have their cameras fully functional. It still has no revenue and lost 6 cents per share during the most recent quarter. It’s got enough cash to get through the next year, but after that, all bets are off. The stock trades at a 60% premium to book value.
I’m as excited about this as Michael Sam would be about a night at the Spearmint Rhino. Sure, it might strike it rich, but there’s no margin of safety if things get delayed. I also don’t see a huge market for really fancy pictures of the Earth from space. The U.S. government already has satellites that can do the same thing.
And finally, most startups make me cringe. I like companies with previous glory, ones with share prices that used to be three or four times higher. Companies with underperforming assets make me excited. They’re hard to turn around, but if they do… oh baby! Money for Nelly.
I’ll pass on these two stocks. To speculative for my nature.