Why Oncothyreon, Inc. Shares Sank

Is this meaningful or just another movement?

Mar 14, 2014 at 12:42PM

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 clinical-stage biopharmaceutical company Oncothyreon, Inc. (NASDAQ:ONTY) plunged 10% today after its quarterly results disappointed Wall Street.

So what: The stock has soared in recent months on improving fundamentals, but today's Q4 results -- net loss of $6.4 million versus a profit of $4.3 million in the year-ago period -- are forcing analysts to lower their expectations a bit. Cantor Fitzgerald even downgraded the stock this morning from buy to hold, suggesting growing sentiment on Wall Street that Oncothyreon's valuation is a bit stretched at this point.

Now what: According to Cantor, the stock's upside is likely to be limited over the next few months. "Our view on the shares has been driven by our belief that the company's early to mid-stage pipeline plus cash could drive the shares to $4," said Cantor analyst Mara Goldstein. "While the data readout for the ONT-380 breast cancer studies could be an inflection point for the shares, the timing is likely late 2014, suggesting to us that without nearer-term catalysts, greater valuation expansion is not likely to occur." Of course, with the stock now off about 20% from its 52-week highs, that short-term uncertainty might be providing patient biotech-savvy Fools with a juicy entry point.

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Brian Pacampara has no position in any stocks mentioned, and neither does The Motley Fool. 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.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

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David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't 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.

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