TSXV:BTI.H - Post by User
Post by
amorakon Aug 19, 2011 3:59pm
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Post# 18961925
BTI - Important for the times ahead...
BTI - Important for the times ahead...
In these times, if we don't own something like BiOasis then we're setting ourselves up for what could be very poor returns in our portfolios. If the global economy is stalling, as appears to be the case, then there will be little growth in the value of most stocks. Profits and/or growth may be very low, possibly nonexistent for a number of years.
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The only real growth that we can expect from our investments may come from stocks that do not depend on profits, on the economy or, maybe more importantly, on the opinions of investors. I believe the growth will come from stocks that, by virtue of discoveries of some sort, become highly valued because they suddenly are attractive as takeover targets. As takeover targets they will ultimately be valued by the company doing the takeover, not by the market. The calculation of intrinsic value discounted by remaining risk is a well known science. Emotions don't enter into it.
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With BiOasis, we know what the discovery is before it's been proven, which means that we can buy the stock cheaply and that we can evaluate its potential value based on the market into which it plays. If that market points to a 50-bagger or more when brought to market then we have the potential for a 10 to 20 bagger at some point through the clinical trials process. Since in any trial there is a greater than 50% chance of reaching the next phase we have staged appreciation of stock value based on anticipated and actual success at each phase. As a result we have natural exit points to remove our risk.
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I've dug through the existing papers on P97 and BBB and I have to say that, for me, BiOasis is an ideal early candidate for investment. It uses a very low level body process to accomplish something that has huge potential value. By low level body process I mean that the more physiologically elemental the exploited process is, the less likely it is to create a cascade of unintended physiological effects, effects that can stop clinical trials and entirely wipe out the stock's value.
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So BTI is a no-brainer for me. Do I expect to make my fortune on it? No, I never "expect" that, but I certainly to believe that the risk/reward ratio in this case is one of the best I've seen. It's the kind of stock that can make you look as smart as Joseph Kennedy looked when he bought mountains of GM stock early in the Great Depression.