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Mar
5
In late July, I posted an analysis of Amylin Pharmaceuticals (AMLN) that was not exactly a favorite of Michael's. I figured that my response belonged in a post rather than in the comments because it was more of a "noise vs. news" debate, and Michael responded in turn with some clarification. (It's not easy to debate online because (a) space is limited and (b) 90% or so of communication - the nonverbal - is non-existent so we must rely on that unreliable 10% - the words.)
The whole discussion revolved around two simple concepts. I believed that Amylin was like every other company out there - that it had an intrinsic value and that, although I couldn't peg the value, it was almost certainly less than $6 billion (the then market capitalization). Michael took a different side - Amylin was worth considerably more than $6 billion, and that smaller investors (operating within their own risk tolerance) should look to buy companies they know (Michael is a pharmacist by profession) before those companies make their billions.
We both approached the company rationally; still, we can't fight the law - price follows value. Know the value and you'll know what price to pay. Not sure of the value? Decision time: Move on? Or, leave your fate in the hands of the traders?
Continue Reading Amylin III - Seven months (and much heartbreak) later ››
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