Based on the aggregated intelligence of 135,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, small-cap biopharmaceutical Ariad Pharmaceuticals
With that in mind, let's take a closer look at Ariad's business and see what CAPS investors are saying about the stock right now.
Ariad facts
Headquarters (founded) |
Cambridge, Mass. (1991) |
Market Cap |
$204.1 million |
Industry |
Biotechnology |
Trailing-12-Month Revenue |
$7.5 million |
Management |
Chairman/CEO Dr. Harvey Berger CFO Edward Fitzgerald |
Return on Assets (average, last three years) |
(54.9%) |
5-Day Return |
46% |
Highly-Rated Biotech Alternatives |
Amgen
Gilead Sciences |
CAPS Members Bearish on ARIA Also Bearish on |
Citigroup
Lennar |
CAPS Members Bullish on ARIA Also Bullish on |
General Electric
Bank of America |
Sources: Capital IQ, a division of Standard & Poor's, and Motley Fool CAPS.
Over on CAPS, fully 43 of the 199 members who have rated Ariad -- some 22% -- believe the stock will underperform the S&P 500 going forward. These bears include cashsage and the second-ranked player in all of CAPS, UltraLong.
Just three days ago, cashsage succinctly aired out the Ariad bear case: "[Ariad] has a too high valuation compared to its sales potential. It is also loss making at least until 2011."
In a pitch from one day later, UltraLong also showed skepticism over the stock's recent surge:
Twenty times sales figures is simply not justified here with drugs that are 3-5 years out at minimum. Losses continue to grow or stay steady around 50-55M per year so you do the math … they have 12 months of cash viability left before yet another secondary hits the tape. I also get a little giggle in my stomach too when I see a book value of negative 79 cents.
So their cancer drug did well in the preliminary trial stage with 80% of the entire 23 patients … I … I have no words, where's my dart board.
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