The Masters of the Universe vs. darts

A biotech company called Reata Pharmaceuticals saw its share price tick upward yesterday thanks to an on-stage endorsement at an event that bills itself as the Super Bowl of investing conferences.

Bihua Chen, who runs Cormorant Asset Management, told the audienceof the Sohn Conference that Reata’s kidney drug has “striking efficacy,” and that the company could be “a 10-bagger,” meaning it could offer a tenfold return.

And that could be true: Reata is up about 50% this year on the back of optimism that its drug, bardoxolone, can treat a genetic kidney disease called Alport syndrome. The company expects to have data by the end of this year.

But before you take anything said at Sohn too seriously, consider the track records of its headlining guests. Last year, the cast of the Wall Street Journal’s Heard on the Street tacked stock listings to the wall and threw darts at them. Over the ensuing year, the dart-selected portfolio outperformed what Sohn’s experts recommended by 27%.