Why Symantec Corporation, Biogen Idec, and Alexion Pharmaceuticals Are Today’s 3 Worst Stocks

Boy, was it rough being a biotech investor on Friday: Two of today's three laggards hail from the high-flying industry.

Mar 21, 2014 at 7:39PM

The S&P 500 Index (SNPINDEX:^GSPC) hit all-time highs today. Then it steadily declined for the remainder of the day, driven by a slumping health-care sector. With Symantec Corporation (NASDAQ:SYMC) being the lone exception, two of the three biggest losers in the stock market today were biotechs: Biogen Idec (NASDAQ:BIIB) and Alexion Pharmaceuticals (NASDAQ:ALXN) both finished near the bottom of the S&P as inquisitive congressmen spooked investors.

Shares of Symantec Corporation, which makes computer antivirus software, plunged 12.9% as the company ditched its CEO. When a company faces a dismal and uncertain future -- as Symantec has in recent years -- an easy lever to pull in an effort to jump-start growth is the makeup of the executive team. But this is an all-too-familiar process for Symantec investors, who put their faith in Steve Bennett less than 24 months ago, only to see him sent off Friday. With the company's growth uncomfortably correlated to PC sales, Symantec might be out of levers to pull.

Now for something completely different and somewhat bizzare: Shares of Biogen Idec cratered 8.2% today, even as its hemophilia B drug Aprolix was approved for sale in Canada. The sudden drop is unquestionably a direct result of unforeseen pressure from three Democratic congressmen, who sent notice to Gilead Sciences requesting an explanation of the pricing methods behind its hepatitis C drug Sovaldi. The action could be seen as an indirect threat to high-cost treatments like Aprolix, which affects just 4,000 people in the U.S and will likely cost a small fortune.

The last of the day's laggards, Alexion Pharmaceuticals, shed 8% Friday. Biogen and Alexion shares are both up more than 70% in the last year as the biotech industry's taken off with insane momentum. Expectations in the area are high, to say the least. On top of that, Alexion's only approved drug, Soliris, appears to fall under the purview of congress' crusade against high-cost treatments: the product costs $400,000 a year. That said, companies can only afford to reduce the commercial price of orphan drugs by so much, because the cost to develop the drug must be economically rewarding for public companies to produce it to begin with.

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John Divine has no position in any stocks mentioned. You can follow him on Twitter @divinebizkid and on Motley Fool CAPS @TMFDivine.

The Motley Fool recommends Gilead Sciences. 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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