Market sentiment indicators such as the Fear & Greed Index currently read neutral for biotech, placing RIGL forecast patterns in a cautious accumulation zone. We would point out that the most important inputs to a discounted cash flow are the discount rate and of course the actual cash flows. If you don't agree with these result, have a go at the calculation yourself and play with the assumptions. The DCF also does not consider the possible cyclicality of an industry, or a company's future capital requirements, so it does not give a full picture of a company's potential performance. Given that we are looking at Rigel Pharmaceuticals as potential shareholders, the cost of equity is used as the discount rate, rather than the cost of capital (or weighted average cost of capital, WACC) which accounts for debt. In this calculation we've used 6.8%, which is based on a levered beta of 0.809. Beta is a measure of a stock's volatility, compared to the market as a whole. We get our beta from the industry average beta of globally comparable companies, with an imposed limit between 0.8 and 2.0, which is a reasonable range for a stable business. $RIGL insiders have traded $RIGL stock on the open market 4 times in the past 6 months. Of those trades, 0 have been purchases and 4 have been sales. In early June, RIGL’s moving average trends suggest near-term consolidation, with the 50-day MA crossing above the 200-day MA signaling potential bullish momentum. Investors monitor clinical news pipelines closely.
