Its share price has been falling steadily all year, but EdgeHill Partners chief investment officer Jason Mann thinks ProMetic Life Sciences (TSX:PLI) is still far from being a stock investors should be looking at.
Mann appeared on BNN’s “Market Call” Tuesday to talk about the once high-flying biotech. The portfolio manager says he has been short the stock but has recently covered because it has fallen “too far, too fast”. Mann says ProMetic’s business hasn’t unfolded the way management has wanted it to.
“It has always been an expensive stock and still is,” Mann says. “Negative ROE’s, there’s no cash flow, there’s no earnings to speak of, it’s incredibly volatile.”
The PM says he would, in fact, buy most any other stock before he would go long ProMetic.
“Unfortunately this stock scores in the bottom five per cent on every metric we look at,” he added. “Poor price momentum, (and) poor valuation because they are not yet a cash flowing entity. But it has fallen so far and is so volatile it becomes quite dangerous to stay short something like this. So we are nowhere on it, but it would be really difficult for me to recommend that someone step in and buy this here given the metrics that it shows.”
At press time, shares of ProMetic Life Sciences were down 4.9 per cent to $1.17.