As an investor, I hate crowds. If a stock or sector that I like attracts a crowd, I know it is time to leave. As they say, the sheep are usually the buyers at the top.

Now, we need sheep to help drive prices of our holdings higher, but at some point it is time to jettison. Nothing goes up forever, and the best signal I have found over the years is to sell when the sheep are buying.

This year the sheep are being told to buy the biotechnology sector.

That advice may be a bit late in coming. 2008 was a disastrous year, but biotechnology did very well. It is that performance that is now attracting the sheep.

After the initial rebuff of Swiss-based pharmaceutical giant Roche's offer to acquire the 44% of Genentech (NYSE: DNA) stock Roche does not currently own, DNA is coyly encouraging the completion of a deal at a higher price.

Genentech is among the leading biotech companies in the world. It is engaged in the discovery, development, manufacturing and commercialization of pharmaceutical products intended for treatment of previously untreatable illnesses.

In 1990, Roche acquired a 56% stake in the company. Since that time, the relationship between the two companies has been a model for similarly structured combinations.

Roche's offer of $89 per share for DNA was characterized by DNA as significantly undervaluing the company.

But this was hardly a "hit the road, Jack" response. DNA's board of directors has been encouraging the two sides to continue discussions, and recent comments suggest that the deal could come together soon.

This post is part of a special annual report -- Top Stock Picks '09 -- in which TheStockAdvisors.com asked 75 leading newsletter advisors to select their favorite investment for the new year.

"Emergent BioSolutions (NYSE: EBS) -- my top 2009 pick -- makes the only FDA-licensed vaccine for the prevention of anthrax," says Timothy Lutts in his The Cabot Stock of the Month.

"Located in Rockville, Maryland, the company is currently filling a $448 million government order for 18.75 million doses, and in October, the U.S. government contracted to purchase 14.5 million additional doses valued at up to $404 million, to add to the Strategic National Stockpile.

"The vaccine is named BioThrax, and it accounts for 97% of the revenues of Emergent BioSolutions. However, the company has a full pipeline including two 'next generation' anthrax vaccines.

"Also in development are two anthrax therapeutics (immunoglobulin and monoclonal), two botulinum vaccines and a botulinum therapeutic (botulinum is the nasty form of Botox), an oral typhoid vaccine, a next generation tuberculosis vaccine, a hepatitis B immunotherapy and a chlamydia vaccine.

There were a few stocks in 2008 that exhibited great performance despite horrible market conditions. And these gems of 2008 may provide investors with a safe haven of sorts for 2009.

In fact, we are already hearing analysis of the year to come suggesting that biotechnology stocks will be the place to be for positive returns in the new year.

One such name to consider is Amgen (NASDAQ: AMGN).

Founded in 1980, AMGN is one of the largest biotechnology companies in the market. It has a stable of proven drugs that provides significant profits, and a pipeline of opportunities that should provide reasonable growth in the future.

Shares of AMGN have gained approximately 20% during the last year as investors recognized the value of current profits combined with future growth. Interestingly, the company really gained traction during the second half of the year as the rest of the market was imploding.

Even with the gains, AMGN is a compelling investment story.

Shares trade for 15 times trailing earnings and only 12 times forward earnings. That means you can buy shares for a price-to-earnings ratio that is lower than its growth rate.

One reason for the optimism in the stock in 2008 was the progress made on its osteoporosis drug, Denosumab. Analysts are expecting the drug to be a blockbuster.

Denosumab has done well in trials, and AMGN recently applied for FDA approval to bring the drug to market. Given the expected 10-month FDA review and processing period, AMGN is only a year or so away from the sales benefits of this new drug.

It's been a tough year for many industries -- there's no denying it. Retailers of all stripes, oil companies, construction firms, financials, basic materials companies -- you name it, it's down.

So, are there any safe havens?

Historically, in times of economic uncertainty the pharmaceutical industry, along with consumer staples, is often the "go to" place where, at a minimum, you can count on a nice dividend yield to shield your portfolio from gigantic losses. Not anymore.

In this downturn even stalwarts such as Merck (NYSE: MRK) and Pfizer (NYSE: PFE) trade near their multi-year lows, despite offering generous yields.

What about biotechs? That sector has performed much better.

However, one of my favorite biotech names, Elan (NYSE: ELN), is struggling.

At the start of the year, ELN was looking strong. Its stock was up by 50% by mid-summer. Since then shares have collapsed and now trade in the mid-single digits.

I profiled the company on July 2, with one caveat: If late-stage testing of a new Alzheimer's drug called bapineuzumab doesn't go as planned, then ELN will trade lower.

About a month later, the company announced that the results of a Phase II clinical study showed the drug does safely treat the symptoms of Alzheimer's disease, but the results were not statistically significant, and the 234-person Phase II study would have to be broadened to a much larger Phase III study to be considered for FDA approval.

The shares fell 17% on the announcement, but that was just the start. As is often the case, when it rains, it pours.

"Long-term, Gilead Sciences (NASDAQ: GILD) is the best life sciences company on the planet," says biotechnology specialist Michael Shulman in The ChangeWave Biotech Investor.

"Auto sales may plunge, home sales may stay in the tank and retail sales may fall, but disease, old age and human frailty are undeniably 'forever.'

"While the economy in 2009 is almost certainly going to contract, analysts expect the sale of biologic drugs and other life sciences products to increase 12%-15% -- with some winners growing much faster.

"The winners will be rewarded, even in a bear market. In the past year, Gilead has outperformed the Nasdaq by more than 30 percentage points -- and it's doing it as a mature biotech.

"Bull markets have been few and far between this summer; one of the few sectors that looks to have re-entered a bull trend is biotechnology," says international investing expert Nick Vardy.

In his Global Bull Market Alert, he explains, "The S&P Biotech ETF (ASE: XBI) looks to capitalize on this traditionally highly volatile and boom bust burdened sector." Here's his bullish assessment.

"Why the sudden merger and acquisitions frenzy in biotech? Put simply, 'Big Pharma' is cash-rich but innovation-poor. As patents expire, the traditional pharmaceutical industry is eager to refill its emptying drug pipelines.

"On the one hand, Big Pharma hopes giant acquisitions jump start pharmaceuticals' sputtering innovation machines. On the other hand, existing biotech blockbusters would also hedge against the coming collapse in earnings from drugs that are coming off patent.

"So why buy biotech now? Technically, biotech is one of the few sectors in the market that are in an uptrend. And while the sector has sold off recently, we think it is a good time to get in.

"The best way to profit from the biotech bull is through the S&P Biotech ETF. Unlike some other market cap weighted biotech ETFs which heavily lean toward industry giants Genentech and Amgen, XBI holds about 25 of the top companies across the entire sector.

"Each company is equally weighted between 3-5% of the ETF. With an industry low expense ratio of 0.35%, it is also the bargain of the biotech ETF sector."

Steven Halpern's TheStockAdvisors.com offers a daily look at the latest market commentary and favorite stock picks and investment ideas from the nation's leading financial newsletter advisors.

This post is part of a series in which TheStockAdvisors.com asked financial experts to name their top stock pick if McCain or if Obama wins the election.

"If Obama gets elected I expect him to pay great attention to domestic health care issues, in which case generic pharmaceutical companies should benefit; India-based Dr. Reddy's Laboratories (NYSE: RDY) will fare very well under such a scenario," says global stock specialist Yiannis Mostrous in The Silk Road Investor.

"The two main prospects for the company are its participation in the generic Allegra business, which could generate about $20 million in profits.

"As Dr. Reddy's has increased its U.S. pipeline filings to 60 Abbreviated New Drug Applications (ANDAs) pending approval, its U.S. business should be back on track soon.

"The second prospect is a potential merger and acquisition spree among the Indian pharmaceutical companies in an effort to face competition more effectively.

"A viable merger will allow companies to reduce research and development (R&D), as well as administrative costs, since there's an overlap when it comes to filing for the approval of similar products.

This post is part of a series in which TheStockAdvisors.com asked financial experts to name their top stock pick if McCain or if Obama wins the election.

"If Barack Obama wins the presidency, one under-the-radar play would be embryonic stem cell research; Geron (NASDAQ: GERN) is the current leader in embryonic stem cell research among publicly traded companies," explains trading and investing expert Bill Martin in his BullMarket.com.

"Embryonic stem cell research in the U.S. is not restricted in any way, as is often popularly believed in this hotly contested debate. The real issue at hand is federal funding, and whether federal taxpayer dollars should be used to help fund the research.

"Currently, federal funding is only available to firms that won't create embryos for use in scientific research or clone them for any reason, and that are working with stem cell lines derived from embryos destroyed before August 9th, 2001.

"In addition, the stem cell lines must have been obtained from 'left over' embryos created solely for in-vitro fertilization purposes from consenting donors without any financial incentive.

"According to a September 2003 NIH report, the only publicly traded company of the more than a dozen institutions listed with stem cell lines that qualified for federal funding was Geron, which has been a pioneer in the field since 1999.

"Embryonic stem cell research is among three areas of concentration for the biotech firm, and it has a large number of related stem cell patents. Some of its major areas of focus include spinal cord injuries, heart disease, and diabetes.

"If Obama takes office, there is a pretty good chance that he and the Democrat controlled Congress will offer government funding for embryonic stem cell research. If this happens, expect Geron to head higher."

Steven Halpern's TheStockAdvisors.com offers a daily look at the latest market commentary and favorite stock picks and investment ideas from the nation's leading financial newsletter advisors.

"If you want to buy a great company dirt cheap, think Biogen Idec (NASDAQ: BIIB)," says biotech expert Michael Shulman. Here's an update from ChangeWave Biotech Investor.

"Biogen recently got hammered on 'bad' news that wasn't actually so bad. BIIB and partner Elan (NYSE: ELN) reported that two MS patients, out of 31,800 currently receiving Tysabri, developed a rare brain malady called PML.

"It's important to note, here, that the two companies had predicted that one in 1000 cases could develop PML and the FDA let the drug come to market with this understanding with a strong set of patient warnings and physician follow up.

"Tysabri has succeeded in the marketplace because it is a superior treatment for MS -- and the patients who use it agree, despite its high cost of $30,000 per year. I expect only a very small drop off in market acceptance for Tysabri and when it becomes apparent the drug is still desired by patients and doctors, the stock should rebound significantly.

"BIIB is still targeting 100,000 patients by 2010 and that would translate into $1 billion per quarter in sales.The two cases of PML cut the stock by almost 30% -- and that's ridiculous. It's simply too big a move for a cash-rich, risk-free company with several major drugs -- especially Rituxan which is taking more market share every quarter.

"Biogen Idec also has the ability to add new products through licensing or direct acquisition, and I expect it to do so in the coming quarters. This temporary downturn is a godsend for investors! BIIB is now selling well below the valuations of other large-cap, double-digit biotech growers. Take advantage of this mistake before the Street wakes up."

Steven Halpern's TheStockAdvisors.com offers a daily look at the latest market commentary and favorite stock picks and investment ideas from the nation's leading financial newsletter advisors.

"Alkermes (NASDAQ: ALKS) recently produced a two-pronged positive surprise; an increase in the size of their already existing stock buyback program and a boost in their financial guidance," says John McCamant.

In his Medical Technology Stock Letter, the biotech sector expert looks at this firm which focuses on treatments for central nervous system disorders, alcohol depenence, and schizophrenia. Here is his review.

"Both of these moves were made possible by the announcement that ALKS has received a $40 million payment from Eli Lilly, their former partner for the now defunct AIR Insulin program.

"ALKS now has the authorization to buy back up to $215 million in common stock. To date, the company has bought back roughly eight million shares of common stock for a cost of about $106 million.

"Additionally, as noted, ALKS has upped their financial guidance for fiscal 2009. Operating income for the year is now expected to end up on the positive side of the ledger, with ALKS anticipating $10-$15 million for the full year.

Buying only stocks announcing splits, Neil Macneale has developed a leading long-term track record. His latest buy in his 2-for-1 newsletter is biotechnology research products firm Invitrogen (NASDAQ: IVGN).

"Wow, investing today is like riding a ping-pong ball; last month I was feeling quite glum about the market and cautioned that we were in for an extended period of below normal portfolio growth.

"That may still be true, but now, as we go to press, the portfolio is at its all-time high and there is reason to believe most stocks we have picked are going to do much better than the overall market.

"Meanwhile, with splits so few and far between these days, one thing is certain; companies that do announce splits deserve a very close look. Our latest selection is Invitrogen. Its primary business is assembling and selling kits used in biotech research.

"I view this as selling the shovels and tents to the gold miners. During the California gold rush, it was the storekeepers that got rich while most of the miners went broke.

"IVGN is not ideal in that it pays no dividend and carries a moderate amount of debt. However, this is a strong business with a history of good earnings and good growth. The healthcare sector has been on the outs for a while now and it's probably a good time to get a biotech company into the portfolio."

Each day, Steven Halpern's TheStockAdvisors.com offers the latest market commentary and favorite investment ideas from the nation's leading financial newsletter advisors.

Technical expert Leo Fasciocco seeks stocks that have broken out from technical basing patterns or those he feels are poised to make such a breakout, such as Gilead Sciences (NASDAQ: GILD), which has a "breakout level at $50."

The editor of Ticker Tape Digest explains, "Gilead Sciences, with annual revenues of $4.2 billion, makes therapies to treat life-threatening infectious diseases. It focuses on pulmonary and cardiovascular diseases.

"The company has four products -- Viread, Emtriva, combination pill Truvada, and triple combination Atripla -- in its HIV franchise, as well as Hepsera for hepatitis B. GILD recently received approval for pulmonary arterial hypertension drug Letairis, acquired from Myogen.

"The stock has climbed from $10 to $47 the past five years. It is one of the few stocks now that is knocking on the door of making a new high. With earnings growth to be solid this year and next, we see GILD in a good spot to be accumulated in anticipation of a breakout.

In news that shows how dangerous investing in small-cap biotechs can be, Sonus Pharmaceuticals (NASDAQ: SNUS) said that its late-stage trials of breast cancer drug Tocosol Paclitaxel have failed.

Sonus shares are down 85%, and are the most actively traded on any US exchange. The stock changes hands at $0.70 down from a 52-week high of $6.32.

Sonus has been something of a one-trick pony. Its revenue has been in the $3 million to $5 million range over each of the last four quarters when it lost $25 million.

With $42 million in cash on the balance sheet, at least the company has some time.

Douglas A. McIntyre is a partner at 24/7 Wall St.

When a relative -- I'll call her "M" to protect her privacy -- told me a few months ago that she and another relative who I'll call "D" were thinking of buying Dendreon Corp. (NASDAQ: DNDN), a biotech stock that at one time was a Wall Street favorite, I wasn't happy. The stock was getting pounded because of concerns about whether the Seattle-based company would get FDA approvals for its Provenge prostate cancer treatment. It turns out my skepticism was right and "M" and "D" were wrong.

Dendreon is basically a one-trick pony, and a money-losing one. As of June 30, the company had an accumulated deficit of $445.5 million. Its shares have plunged more than 50% since May, when the FDA didn't approve Provenge as had been expected.. The stock fell again in July after the company said the SEC was conducting an informal inquiry and that it was hit with a shareholder lawsuit.

Investors' hopes were rekindled again earlier this month after Dendreon released what was seen as promising results for its Neuvenge treatment for breast cancer. Forbes magazine, though, cautions against reading too much into these results.

"While the Neuvenge results were positive, Dendreon investors will have to be patient," the magazine said. "The drug's human trial remains in the early stage, meaning that Neuvenge has a long way to go before it nears Food and Drug Administration approval. Investors remain concerned that Neuvenge could go the way of Provenge."

Provenge remains Dendreon's bread and butter -- at least it would be if the company actually had products. The company made that point very clear in a recent filing with the SEC. "If we fail to obtain FDA approval for Provenge or fail to successfully commercialize Provenge, our business would be harmed and our stock price would likely decline," the filing said.

How true.

Hopefully, M&D will eventually recoup some of their losses so they can focus on more important things like spoiling grandchildren.