Why MannKind Is Poised to Pull Back

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, biopharmaceutical company MannKind has received a distressing two-star ranking.

With that in mind, let's take a closer look at MannKind and see what CAPS investors are saying about the stock right now.

MannKind

Headquarters (founded)

Valencia, Calif. (1991)

Market Cap

$2.1 billion

Industry

Biotechnology

Trailing-12-Month Revenue

$35 thousand

Management

Founder/Chairman/CEO Alfred Mann

President/COO Hakan Edstrom

Return on Equity (average, past 3 years)

(39.4%)

Cash/Debt

$28.0 million / $332.0 million

Competitors

Eli Lilly
GlaxoSmithKline
Novo Nordisk


Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 16% of the 695 members who have rated MannKind believe the stock will underperform the S&P 500 going forward.

Just yesterday, one of those Fools, All-Star zzlangerhans, tapped the stock's recent surge as particularly unsustainable:

At the end of last year I looked over all the stocks in my biopharma database and tried to predict which would be the biggest runner of 2013. My conclusion? Mannkind. But I never bought in or even green thumbed because the run started earlier than I expected and I kept waiting for a pullback that never came. ... And after the company solidified their guidance to topline results of Affinity 1 and Affinity 2 in mid August, the stock went parabolic. The moral: don't be so obsessed with catching a stock at the absolute bottom. ...

Now I'm left with another crummy red thumb. I don't think Mannkind is worth two billion even if the Affinity trials are a resounding success and Afrezza is approved the next time round. I've been a long-term bear on MannKind for years and my reasons are well-documented here. A 300% rise in share price this year is completely unjustified and simply represents traders playing the "greater fool" game. I'm terrible at judging when that game will end but at some inflection point, whether it is positive data or drug approval, this stub is going to tank.

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The article Why MannKind Is Poised to Pull Back originally appeared on Fool.com.

Fool contributor Brian Pacampara has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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