Which of these stocks gained +145.7% in
just four short months--+400% for
investors who got in a little
earlier--after winning approval from the
U.S. Food and Drug Administration for an
enzyme that can be used in the
production of beer and wine?
A.) Dyadic International (DYAI)
B.) Amgen (AMGN)
C.) Genzyme (GENZ)
D.) Gilead Sciences (GILD)
E.) Biogen Idec (BIIB) |
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Published: November 25, 2009
The
correct answer is
(A.) Dyadic International
The company, which has already
licensed out some of its
energy-related technology, also
recently won U.S. Food and Drug
Administration approval for an
enzyme that can be used in the
production of beer and wine. Its
shares have gained +145.7% in just
four short months. Earlier investors
have done even better--the stock's
$0.49 nadir this summer has produced
a +400% pop for some.
It just goes to show that a stock
can indeed continue rising, even
after a strong gain. Although the
gains might not continue
indefinitely, it's no stretch to see
such a dramatic trend last for
years. Hundreds of stocks have
conclusively proven that selling to
collect a short-term gain can be
ill-advised -- and very costly.
Take Apple (Nasdaq: AAPL), for
instance. Had an investor bought
shares in late September 2003 for
$10.35, he or she could have taken a
nice +80% gain the following year
when the price hit $18.60. But any
investor who did so would have
failed to cash in on Apple's
eventual rise to today's price of
$196.35, a +1,816% gain. Which one
would you rather have?
The fact is that short-sighted
analysts are the only ones who care
about today's results. Investors
looking for long-term gains need a
more thorough analysis--the kind
StreetAuthority editor Andy
Obermueller provides in his
Government-Driven Investing
newsletter. Each month, Andy
highlights and provides in-depth
analysis of companies poised to
capitalize on government activity
around the world. It's just one way
StreetAuthority helps investors spot
stocks that lead to long-term
wealth. To learn the names of Andy's
other picks, and to learn more about
Government-Driven Investing,
please visit this link.
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