TSXV:BTI.H - Post by User
Comment by
prophetoffactzon Feb 24, 2023 3:57pm
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Post# 35304327
RE:Highs, Trends and Nonsense
RE:Highs, Trends and Nonsense
"Any good or bad story that relates to a speculative stock will cause that stock's share price to buck any larger trend, including how the holy S&P Biotech EGF trends."
The market can be overwhelming.
Check out the chart for ARRK. It invests in long term speculative assets in various industries. The big cashflow is way in the future. It is down about 75% in the last two years. The S&P Biotech ETF peaked about the same time. Biotech cashflows tend to be way in the future and lots of cash is needed to get there. It is down about 53% over the same period. Cashflow way in the future is like poison to a stock in an inflationary environment. Interest rates had fallen to approximately zero meaning the discount for future cashflows was minimal. Now you can get a one year US treasury for 5.046% with no risk. Many are now just investing in fixed income. How much more of a return do you need to compensate for the risk in preclinical biotech in addition to the risk-free rate? Most preclinical biotech fails. 25% of biotech was trading below cash. No one wants it. The value of the science was negative.
BTI is potentially two years from the clinic as it tries to give birth to a new horse after Herceptin. It has debt. It needs two years of cash to get to hard data. BTI is a mess. Get it $20 million to pay off the debt and to hard milestones and to build a pipeline with $20 million of warrants on top and that's $40 million in fully diluted market cap. How much can we expect for current shareholders...