AMAG

I rarely recommend stocks in my blog. I came across AMAG on May 20, 2016. I placed an order right away. Initially the order was not executed as the stock price kept on climbing up. I got it by placing a market order. I also placed several orders at better prices and I bet they will not be executed.

It had passed my three scoring systems before: one described in my book Scoring Stocks and the other two including my subscription services (one for short term and another one for long term). Now, it is about half the price of the time I evaluated.

I looked at why it was priced that low from Seeking Alpha and Yahoo!Finance board. I looked at the expiration of its major drug and any lawsuit pending. I did not find any. It could be the crashing of biotech stocks after a great year or two. It did have some resembling of VRX (i.e. borrowing money to buy another drug company). However, it seems it has enough cash flow to keep it going. Here are some lessons.

·        Even in today’s risky market, there may still be some bargains. When the expected P/E is less than 3, it could be either a bargain or a trap. Only time can tell.

·        Do your homework especially on why it is so value.

·        When the stock price is rising, you can only buy it via a market order.

·        If I lose money on this trade, it is fine as long as my procedure is correct.

Most authors will give you their promising trades after the fact and this one is before the fact. You can blame me for being stupid but not for being honest.

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This is one page of the 820 pages of my Kindle book "Complete the Art of Investing". If it helps you, envision how 820 pages will help you.

For more of my reasoning, check out the book described next. It has 820 pages (6*9) for $9.99. It could be the best $10 you ever spend.

The above is an abstract from my book "Complete the Art of Investing" which is available from Amazon.


I challenged to have the best-performed article in Seeking Alpha history, an investing site, for recommending 5 or more stocks in one year after the publish date. The concepts for that article are discussed in this book.