Shares of one of the most popular biotech companies have corrected 85% from their all-time high and are attractive to investors due to very optimistic analysts’ forecasts.
The consensus is $38.83 per share, the equivalent of a 269.81% gain. This post aims to technically break down the issuer’s chart and discuss the advisability of investing in G1 Therapeutics.
The first thing everyone needs to understand is that analysts’ forecasts are often worthless. You can see such “expectations” for almost every biotech company, especially small-cap ones.
Technically they expect to see such prices within 12 months, but in fact it can take years. The situation can only be saved by the release of news of a brand-name drug approval from the FDA, otherwise the value of the securities will be systematically reduced to 0.
Personally, this is a very big risk for me, for which I can pay no more than 0.5-1% of my capital. Technically, current prices are favorable for buying, but a decline to the range of $6-7 per share is very likely, so it is better to gain a position in installments.