Infinity Pharmaceuticals Inc. (INFI): Billionaire Steve Cohen’ SAC Up to 5% of This Stock

Other development stage biotechnology companies where there is currently no expectation for positive earnings on a forward basis include Alnylam Pharmaceuticals, Inc. (NASDAQ:ALNY), Synageva BioPharma Corp (NASDAQ:GEVA), Theravance Inc (NASDAQ:THRX), and Ariad Pharmaceuticals, Inc. (NASDAQ:ARIA). These stocks are also all small caps. Synageva BioPharma Corp (NASDAQ:GEVA) and Theravance are somewhat popular short targets, with 27% of the float held short in Theravance Inc (NASDAQ:THRX)’s case. For what it is worth, Ariad Pharmaceuticals, Inc. (NASDAQ:ARIA) develops cancer medications, Synageva BioPharma Corp (NASDAQ:GEVA)’s primary product is designed to treat lysosomal acid lipase deficiency, Alnylam currently has several products in clinical trials for patient with various blood disorders, and Theravance Inc (NASDAQ:THRX) develops medicines to treat respiratory, bacterial, and central nervous system conditions.

Of course, many investors will avoid development stage drug companies entirely and certainly one cannot make a value case for a company which is not on track to generate earnings this year or next year. While Infinity Pharmaceuticals Inc. (NASDAQ:INFI)’s stock price has been rising, that is not a good case for buying a stock and it’s certainly questionable that major owners have been selling shares. In addition, the company’s cash flow from operations is negative; while the balance sheet indicates that there is enough cash to support Infinity Pharmaceuticals Inc. (NASDAQ:INFI) for the time being, this further demonstrates the business’s distance from producing solid financial results. There is a roster of interesting owners but we’d advise against buying and the company may not even be worth following for investors unless they are able to analyze trial data for Infinity’s drugs as it comes in.

Disclosure: I own no shares of any stocks mentioned in this article.