Why Epizyme Inc. Shares Exploded Higher

It's payday for Epizyme and shareholders couldn't be happier. Is now the time to cash in your chips or could Epizyme head even higher?

Jan 7, 2014 at 3:00PM

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: Shares of Epizyme (NASDAQ:EPZM), a clinical-stage biopharmaceutical company developing treatments for patients with genetically defined cancers, exploded higher by as much as 84% after it announced after the bell on Monday that EPZ-5676, a DOT1L inhibitor for acute leukemias, had reached its proof-of-concept milestone.

So what: According to Epizyme's press release, its achievement of the proof-of-concept milestone, which was triggered by "objective responses in patients with translocations of the MLL gene," earns the company a $25 million milestone payment from its collaborative partner Celgene (NASDAQ:CELG), which has the rights to the currently experimental drug outside the U.S. In addition, Epizyme's update also notes that it earned a separate $4 million milestone payment from GlaxoSmithKline (NYSE:GSK) for one of three histone methyltransferase target included in the duo's collaborative efforts. Because of these payments, Epizyme boosted its year-end cash guidance to $145 million from previous forecasts of $115 million.

Now what: The real news here is that if Celgene is forking over $25 million to Epizyme, EPZ-5676's data must be impressive. We should have a better idea of exactly how promising that data is sometime in the first half of 2014. With Epizyme's press release also noting its intention to run five clinical proof-of-concept trials in 2014, it's clear that this is going to be a company with a lot going on this year. I'm personally not chasing today's run-up higher because I'd much rather see that early-stage data in plain-as-day text than guess how good or bad it might be. Until we get more concrete data, the risks at these lofty levels could outweigh the rewards.

Is this the next stock set to explode higher?
There's a huge difference between a good stock, and a stock that can make you rich. The Motley Fool's chief investment officer has selected his No. 1 stock for 2014, and it's one of those stocks that could make you rich. You can find out which stock it is in the special free report: "The Motley Fool's Top Stock for 2014." Just click here to access the report and find out the name of this under-the-radar company.

Fool contributor Sean Williams has no material interest in any companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong.

The Motley Fool recommends Celgene. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Money to your ears - A great FREE investing resource for you

The best way to get your regular dose of market and money insights is our suite of free podcasts ... what we like to think of as “binge-worthy finance.”

Feb 1, 2016 at 5:03PM

Whether we're in the midst of earnings season or riding out the market's lulls, you want to know the best strategies for your money.

And you'll want to go beyond the hype of screaming TV personalities, fear-mongering ads, and "analysis" from people who might have your email address ... but no track record of success.

In short, you want a voice of reason you can count on.

A 2015 Business Insider article titled, "11 websites to bookmark if you want to get rich," rated The Motley Fool as the #1 place online to get smarter about investing.

And one of the easiest, most enjoyable, most valuable ways to get your regular dose of market and money insights is our suite of free podcasts ... what we like to think of as "binge-worthy finance."

Whether you make it part of your daily commute or you save up and listen to a handful of episodes for your 50-mile bike rides or long soaks in a bubble bath (or both!), the podcasts make sense of your money.

And unlike so many who want to make the subjects of personal finance and investing complicated and scary, our podcasts are clear, insightful, and (yes, it's true) fun.

Our free suite of podcasts

Motley Fool Money features a team of our analysts discussing the week's top business and investing stories, interviews, and an inside look at the stocks on our radar. The show is also heard weekly on dozens of radio stations across the country.

The hosts of Motley Fool Answers challenge the conventional wisdom on life's biggest financial issues to reveal what you really need to know to make smart money moves.

David Gardner, co-founder of The Motley Fool, is among the most respected and trusted sources on investing. And he's the host of Rule Breaker Investing, in which he shares his insights into today's most innovative and disruptive companies ... and how to profit from them.

Market Foolery is our daily look at stocks in the news, as well as the top business and investing stories.

And Industry Focus offers a deeper dive into a specific industry and the stories making headlines. Healthcare, technology, energy, consumer goods, and other industries take turns in the spotlight.

They're all informative, entertaining, and eminently listenable. Rule Breaker Investing and Answers are timeless, so it's worth going back to and listening from the very start; the other three are focused more on today's events, so listen to the most recent first.

All are available for free at www.fool.com/podcasts.

If you're looking for a friendly voice ... with great advice on how to make the most of your money ... from a business with a lengthy track record of success ... in clear, compelling language ... I encourage you to give a listen to our free podcasts.

Head to www.fool.com/podcasts, give them a spin, and you can subscribe there (at iTunes, Stitcher, or our other partners) if you want to receive them regularly.

It's money to your ears.

 


Compare Brokers