i figure this place beats the stock market forum for advice...

[astroglide]

http://www.accentia.net/

i can buy pre-ipo shares for the offering price. can anybody in related fields offer their opinion?

[willie]

fold preflop.

[edtost]

[ QUOTE ]
i figure this place beats the stock market forum for advice...

[/ QUOTE ]

so would a random number generator.

[Non_Comformist]

Astroglide, The important question in dealing with a Biotech and especially one that is pre IPO, is what information has led you to want to invest in it to begin with. Generally two types of people do well with Biotechs, #1 People who have not only a great grasp of the industry and what is being done but also enough money to diversify in many similar companies. #2 Insiders who have a scientific understanding about the company, what it is doing and a belief in it. The later usually gets rich off the IPO.

The vast majority of Biotech's that go public are doing so on the strength of one idea, if it does not hit big the company either fails or languishes for an extended period of time.

That web site did not provide any where near enough information to make an opinion about Accentia either way.

Do you have a prospectus?

[lu_hawk]

without knowing anything about this company other than what they do i could give you some advice about these types of companies in general.

1) they are high variance, when your whole company depends on a few drugs that are hit or miss then it is impossible to get to the long term. so even if the offer price is too low and you get +EV from buying it you still need luck on your side. whenever you see a stock down more than 50% in a single day, it is virtually always a biotech company.

2) in order to really try to value a company with developmental stage drugs you need to assume all kinds of probabilties in terms of chance of drug getting through trials, what kind of market it will get if it gets through trials, what the profit margin will be, etc. i doubt it is possible for anyone to do with any degree of accuracy. and realize that the person selling to you knows much more about the company than you do.

if you think it will pop for some reason then that is a game you can play, but i don't think you could make a case for a good investment. and IPO's don't pop on the first day the way that they used to.

[Boris]

I have to say I disagree strongly with all the previous posts. This is normally a great opportunity to get in right before an IPO. What you are looking to do is take advantage of the post IPO bounce. Hit and run baby. Admittedly this price spike isn't what it used to be, but I can't think of many other investment opportunities that are this close to easy money. Now here are two items of caution. I have a colleague at a VC firm that specializes in Bio-tech. He was complaining the other day that the IPO prices in Biotech shares were flat or only slightly above the most recent VC valuation, and very little post offering spike. I know the biotech sector in the public markets is slumping right now. Do some research into what has been happening to the post IPO prices of recent biotech offerings.

The second word of caution is to make sure your shares are not subject to a lock-up agreement. Usually they only make the major investors sign these things but you want to double check.

[lu_hawk]

[ QUOTE ]
I have to say I disagree strongly with all the previous posts. This is normally a great opportunity to get in right before an IPO. What you are looking to do is take advantage of the post IPO bounce. Hit and run baby. Admittedly this price spike isn't what it used to be, but I can't think of many other investment opportunities that are this close to easy money. Now here are two items of caution. I have a colleague at a VC firm that specializes in Bio-tech. He was complaining the other day that the IPO prices in Biotech shares were flat or only slightly above the most recent VC valuation, and very little post offering spike. I know the biotech sector in the public markets is slumping right now. Do some research into what has been happening to the post IPO prices of recent biotech offerings.

The second word of caution is to make sure your shares are not subject to a lock-up agreement. Usually they only make the major investors sign these things but you want to double check.

[/ QUOTE ]

the last 5 biotech IPO's:

THLD: offering price of $7, closed at $7.14 on first day, currently at $6.23.

ICGN: offering price of $8, closed at $7.30 first day, currently at $7.

FVRL: offering price of $7, closed at $6.80 first day, currently at $3.90.

THRX: offered at $16, closed at $17.85 first day, currently at $17.70.

MNKD: offered at $14, closed $14.08 first day, currently at $13.85.

So out of the sure thing easy money IPO's 4 out of the last 5 are down from their offering price, 2 closed down on the first day, 2 closed up fractionally on the first but are now down from their offering price, and one closed up by less than $2 and is flat since then.

[Boris]

yea no bounce. oh well. If the expected offering price is substantially higher than what glide is getting in at at, I'd still make a big investment.

[TimM]

[ QUOTE ]
http://www.accentia.net/

i can buy pre-ipo shares for the offering price. can anybody in related fields offer their opinion?

[/ QUOTE ]

Why are you getting this chance? If you are not a big account, maybe expectations are not good for this one. I'm not saying you aren't, I have no idea, just something to consider. I remember when IPOs were reserved for the biggest and best clients, maybe that has changed.

[astroglide]

it's a personal favor/offer through a friend. the amount of money i would be willing to put in will be a pittance compared to what's already there, and it's not being offered to make some kind of profit on it.

[Boris]

hey i didn't read your OP carefully. I take back everything I said. I thought you were getting in at the most recent financing valuation. if you get shares at the offering price, I have no opinion on what you should do. i feel kind of stupid now.

[astroglide]

i understood where your perspective was coming from. i need to ascertain what price i will actually get today, it's not clear to me either.

[wacki]

Man this thread was buried under a pile of OOT crap.

Asto, I'm not very familiar with that company and there is very little information given on that web site. I will try my best to give you some advice though.

Pro's: The company seems to be investing in the right areas. I believe that unless some technology comes along and blows their technology out of the water, they will have some good products to sell to the biotech community. Keep in mind the information is nowhere near the amount needed for a deep read. I would say the read given from that web site is about as firm as the stats given by 100 hands via poker tracker.

Con's: Pharmaceuticals are volatile. Just because you have good technology doesn't mean you can sell it. Stats are misleading and drugs can explode or die overnight. Pharmaceuticals sales people are notorious for not really understanding their products. They are generally picked for their looks and work ethic over their actual knowledge. Young blond females are particularly popular in this line of work. Biology background is optional.

Pro's: Your company is selling equipment. That stuff pretty much sells itself. Your company is also not in the software business, which is a very good thing because most of the commercial software I've worked with is crap.

Cons: Biotech companies are made or broken by the luck/choices of management. I've seen many managers think they need to concentrate on sales when sales pitches don't effect researchers. Ph.D's are literally professionals when it comes to doing their own homework. If management decides to chop up R&D and hire a bunch of sales people the company is going to crash. The execs will then sell the company and bail with a golden parachute. I've seen this happen more times then I can count within the last 5 years alone.

A lot of things have to come together to make a biotech company work well. But when it works, it usually works very well.

Con: Without going into politics too much, the biotech industry is literally being cut to pieces right now. Bush has cut billions out of the biotech industry in order to help fund the war. I don't know how that is going to effect the stock.

Advice: Be very careful who you get biotech advice from. Many people in the field get super excited over sexy technologies like iRNA when they aren't as promising as you might expect. The potential for many of these simple to explain technologies is huge and execs go crazy over them. However, it takes a very good chemist or biologist to truly understand why many of these "sexy" technologies aren't as good as many like to believe.

My synopsis? Overall I have a good feeling about that company but my read is a shallow one. That company makes equipment for cell line cultures and I have a strong inclination in believing that area will grow in the future. However, I would need to see some hard numbers facts and figures about how much their equipment is going to benefit researchers. Researchers don't buy equipment unless the benefits are very clear. The current condition of federal funding makes me feel uneasy about the investment. Still, I think the cell line cultures area is strong. I've seen many other very small production level companies in this line of work do very well in the last few years. If I were you, I would take whatever data you have that is available to the public and ask a friend that is a "principle investigator" what he or she thinks.

I hope this helps. Good luck.