Star Scientific Shares Plunged: What You Need to Know

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Once again, shares of Star Scientific (Nasdaq: CIGX  ) fell more than 10% on no news whatsoever. Welcome back to the wide world of speculative microcaps.

So what: A broad market meltdown appears to be to blame for Star's suffering this time. For long-term investors, it's an opportunity to get in at … 28 times book value and 566 tomes sales. Ouch.

Now what: Bullish investors will rightly counter that Star's CigRX dietary supplements are no different from any in-development drug and that the potential payoff for reducing or eliminating cigarette cravings could be in the billions. In that sense, today's selloff could be a non-event. Do you agree? Disagree? Weigh in using the comments box below.

Interested in more info on Star Scientific?Add it to your watchlist.

Fool contributor Tim Beyers is a member of the Motley Fool Rule Breakers stock-picking team. He didn't own shares in any of the companies mentioned in this article at the time of publication. Check out Tim'sportfolio holdings and Foolish writings, or connect with him on Google+ or Twitter, where he goes by @milehighfool. You can also get his insights delivered directly to your RSS reader.

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Read/Post Comments (3) | Recommend This Article (1)

Comments from our Foolish Readers

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  • Report this Comment On August 04, 2011, at 10:54 PM, PtheEskimo wrote:

    Today's selloff seems to just be a trend based on fear. What is amazing is that there are so many countries out there that cannot balance their budgets and of course this lends to fear in the people that trust in these country's governments and thus a race for secure wealth. If anyone of us cannot balance our budgets at home we feel the negative affects immediately. We should elect someone from a state with a budget surplus to turn this country around financially. No intent to get political (how can you not in the present economy) but to weigh in this selloff seems to be a non event as far as CIGX is concerned but quite possibly an event for the US.

  • Report this Comment On August 05, 2011, at 8:11 AM, YankeesWin wrote:

    All we need to know is that Motley Fool ran the same article twice because they are short CIGX

  • Report this Comment On August 05, 2011, at 11:30 AM, Metaworld wrote:

    Actually the second article looks different to me. I don't think the speculation is focused on CigRX as a cessation product, but more so on the ingredient Anatabine that is in it. That's why current fundamentals aren't as relevant in the purchase decision. As far as the sell off being an event, it depends. It you believe the macro environment is going to stabilize or improve AND believe in the future potential of Anatabine, then it's probably a nice price to get into the stock.

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