Monday, December 12, 2011

SIGA Gets $36 Million

Note to readers bored senseless by all the SIGA talk: this will be the last such posting for a while. News has been particularly eventful, so I felt obliged to update, but this will be my last until anything dramatic happens. On the other hand, this would be a good point to buy a few dozen/hundred shares for yourself (it won't budge the stock price, so I'm not being self-serving!). There's an excellent chance this stock will septuple within a year or two or three, and having "skin in the game" will make my SIGA postings a lot more interesting for you! But only invest money you can afford to lose...

The first $36M payment is in from the government. So despite all the misinformation, the contract's on, and the company won't need to dilute the stock to remain fully operational.

Someone obviously leaked this news on Friday, hence the stock's mild drive-up. It should have been sharper, but, as I keep saying, don't expect news or "prospects" to do much at this point. Nothing great will happen until the company confirms revenue from multiple sources (and the lawsuit's resolved) a year or two or three from now. The good news is that, short of bankruptcy, it's very difficult to imagine how SIGA would fail to attract multiple revenue sources...even if the bad judicial decision stands on appeal, and even if Chimerix loosens up the primate rule and manages to get a piece of the pie for their inferior drug.

What may happen, however, is another round of propaganda and huffy political nonsense. But that's all about short term shorting, not long term reality. This is the only completely safe and effective drug for pox, including weaponized varieties. Foreign orders (Israel? EU? India? WHO?) await a step or two from FDA. And even assuming Chimerix has their hooks into that agency, eventually we'll emerge from that process, and anyone worried about terrorism will be ready to buy.

Again, it will take time (so your investment may be "dead money" for a while). And the bad guys may drop more shoes. And "stuff happens". But it's been years since I screamed "BUY!" at you. And now's the time. If smart investing means finding extremely undervalued gems poorly understood by the market (stock-hounding!), with known, surmountable downsides, then this is really as good as it gets. This should be a $10 stock right now under the most pessimistic of assessments. And it seems destined for $20 and well beyond.

You're on your own for a while re: SIGA news. If it cycles down, don't panic. If it gears up, don't exult. Give it a couple years for best results. That's my outlook until further notice!


Ghalib Suleiman said...

Jim Leff said...

Fully expected. On to appeal.

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