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Pacific Biosciences Stock Falls While Revenue Rises

April 6. 2022. 4 mins read

One of Warren Buffett’s many notable quotes is that “if you’ve been playing poker for half an hour and you still don’t know who the patsy is, you’re the patsy.” In the investing world, these people are called bag holders. They’ll buy a stock when it’s close to peaking and then hold it stubbornly until it becomes worthless. You can avoid most of these situations by not investing in companies unless they have revenues. That’s because companies with strong revenue growth have intrinsic value that supports the share price.

One thing bag holders like to do is make excuses for the companies they’re holding. They’ll focus more on remedying losses than realizing gains. This stems from a psychological concept called “loss aversion” where we feel the pain of loss twice as much as the joy of gains. Being in the red on any stock you’re holding is psychologically painful, particularly when a company is doing well. One life sciences stock that probably has many investors in the red right now is Pacific Biosciences (PACB).

Graph showing declining stock movement of Pacific Biosciences (PACB).
Credit: Yahoo Finance
Click for company website

Another thing that Warren Buffet said was tha

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