Schering-Plough Corp. (SGP)

All Comments on SGP

  • commenter
    businessguy8
    8
    Aug 18 07:56 AM
    Time to Invest in Pharmaceuticals? [view article]
    one of my major concerns about this upcoming year is how the election will pan out. If universal healthcare turns out to be a real possibility, then pharma companies are going to find it even tougher as their biggest customer will be the government. Reply
  • commenter
    Shiv
    Aug 14 07:16 AM
    My Website
    Are Big Pharma's Dollar Days Nearly Over? [view article]
    I was born immortal and so shall I die; at birth I drew my first breath on a genetic memory; my heart beat of its own accord and my brain operated a highly complex organism without instruction. As I die, my genetic legacy shall live on. Humans have such a desire to live in perpetuity, be it through life extensions or reincarnations; that an industry which tries to satisfy the human quest for immortality must succeed. That aside, I have always wondered whether an answer to the age old Indian epics lies in Bio-tech; as in is immortality or reincarnation simply a genetic legacy explained; did Rama truly live for an epoch through advanced medicine or is it simply living through passage of a genetic legacy (with death being the consequence of the maternal line being ultimately extinguished); or hybrid beings (mythological beings like Garuda) a genetic possibility. There is so little we know and so much to accidentally discover; health-care remains a huge growth area. And Pfizer as an R&D focused organization has amongst the best chances of making that accidental discovery. Patience and a yield makes it worth the risk & the wait.

    Foreign sales can never be a head wind; the growth opportunities in the pharmaceutical industry lie outside US; that is where the human quest for immortality is at its earliest stage. Sure the exchange rates may imply declining revenue in $ terms; but will this happen? I think not. Overseas demand, particularly in emerging (high growth) markets where brands are favored over generics, is highly elastic. A proportionate decline in the importing country currency pricing would lead to a more than proportionate increase in demand and this could actually result in elusive growth for Pfizer. Pfizers problems are:

    (a) Science - Pfizer needs to move away from synthetics and into biologic, genetic, stem cell solutions; unlike synthetics, these latter areas are less prone to patent disputes. They can build this pipeline in house, in-license it or acquire it. More than a pipeline, I feel a high quality of earnings pipeline is what is required. Success from their existing pipeline will provide a catalyst to a higher multiple, but long term, refocus on quality of earnings needs to be a priority. Synthetics is yesterdays game and it would be a shame to see Pfizer fall by the wayside because the failed to glimpse the future; much like the US Auto majors.
    (b) Marketing - this is a big strength and it must be leveraged. With drug approvals taking so long, the time in market from patent filing is far lower than before so making the most of the market is critical.
    (c) Financial - there is limit to how much US leverage can be used for share buy backs & dividends. There is a high cash build from overseas operations and ultimately the foreign cash needs to come back to US and this will come at a tax cost. Since this cash is "trapped" outside US, perhaps use in an acquisition of non US assets would be viable. I do feel use of a debased currency such as Pfizer's shares or the $ is a deterrent in planning an acquisition, but perhaps a stronger $ will help. If this occurs, a reverse acquisition which inverts the group should be considered.
    d) Management - A visionary CEO supported by a strong General Counsel please. Patents need to be protected, but legal is a support service, not the core business.

    Overall, I believe they are headed in the right direction; but it is more of a drift than a purposeful stride. Until science delivers there is no great catalyst. Absent a catalyst, I would look for a range of $14 to $25. A catalyst emerging would drive re-rating & multiple expansion. For now, the only catalyst is the pharmaceutical industry defensive characteristics, which together with the dividend should mean the stock should find near term support and trade upwards to $25-$30range (including dividends) on a 9 month basis.

    If you consider that the stock went ex dividend, on 6 August, it is not surprising that it is a struggle to take out the $20 barrier. It also needs to systematically work through resistance at $19.91, $20.23, $20.71, 21.11 and $21.50; this is necessary for the damage of Q2's slide to be undone. If it clears $21.11 then $23 & $25 should be strong resistance levels as those were high volume sell off days which will likely mean sellers will emerge.     Reply
  • commenter
    Capitalist
    Cow
    Aug 09 10:16 PM
    My Website
    Buying Healthcare Stocks for an Obama Presidency (Part III) [view article]
    Bearfund,

    What evidence do you cite for your argument that government will have a large impact of the success or failure of these private firms? And do you feel that this is not priced into the equities currently trading at historically low valuations?

    Sure, government may be large purchasers of good from different industries, but when has government ever intentionally put an entire industry out of business. This is anything but the American way.

    Where do you get your forecast for a societal collapse? One of the most critical flaws and highlights of democracy is that it is slow to move. Look at the multiple attempts to reform Social Security, Medicare, and Medicaid. Look at the current hot button issue, energy prices. Has there been any progress toward making meaning change? And this is when 80% of Americans want offshore drilling.

    How likely do you think it is that Congress will get enough momentum to make a healthcare reform which is clearly a poor economic decision?
    Reply
  • commenter
    bearfund
    Aug 09 03:17 PM
    Buying Healthcare Stocks for an Obama Presidency (Part III) [view article]
    Cow, progress? No, I don't see any new culture of progress. I do see a current culture of regress, however, and expect it to continue. Partisan gridlock serves only to slow this regression to socialism and ultimately to collapse, but it does not reverse it. I expect the investment climate to be as bad under an all-democrat government as it was under an all-republican government during the earlier part of this decade. Different sectors will be relatively harmed or aided by government spending; tomorrow's answers to Halliburton and Goldman might be First Solar and Granite Construction. Or they might be someone else.

    I'm pretty sure, however, that SGP isn't it. The author first argues that the push to confiscate patent drug premiums won't likely hurt the pharmaceutical industry much because most of its patents are expiring anyway. Ok, maybe. But he then goes on to suggest that SGP is better off because it will have more revenue from drugs under patent protection going forward than its competitors. In that case, wouldn't it simply have the most to lose from a confiscatory policy regime? And before you tell me I'm simply misunderstanding and that Mr. Barath really means the relaxation in prices will quell the call for that sort of regime, I might observe that a policy that has little far-reaching effect but is seen to be "Doing Something About the Problem" is exactly the sort of thing politicians love. If the first argument is correct, this sort of policy should be attractive. Either way, SGP would be the loser. In a free market, I'd agree with much of this investment thesis and consider SGP more seriously. This is not a free market.

    No position.     Reply
  • commenter
    Capitalist
    Cow
    Aug 08 11:44 AM
    My Website
    Buying Healthcare Stocks for an Obama Presidency (Part III) [view article]
    J. Chris,

    I speak to this in my past article located at capitalistcow.com/2008.../

    I am arguing that a political culture shift will not occur, or Obama is no different than any other divisive politician. You assume the will exists in Washington to accomplish a task of this magnitude.

    It has been very difficult to accomplish any reform in congress over the past 15 years. I look to the first attempt at healthcare reform, social security reform, immigration reform, and more recently energy policy. This is likely to continue with a 49-49 political party deadlock in the Senate and the small 236-199 democratically led House.

    Do feel that there will be a new culture of progress in Washington, which will allow major reforms to get past?
    Reply
  • commenter
    J.
    Christoph
    Amberger
    Aug 08 11:30 AM
    My Website
    Buying Healthcare Stocks for an Obama Presidency (Part III) [view article]
    While I consider the underlying demographic trends in America bullish for a select number of medical REITs, health care and pharma stocks, I can't help but think that an Obama presidency -- undoubtedly accompanied by Democrat dominance of House and Senate -- will result in an overall strengthening of the trial lawyer lobby.

    Based on the demonization of oil companies and the call for redistribution of their 8.9% margins, the public image of HMOs and pharma companies would indeed make these industries prime candidates for confiscatory tax policies and tort/malpractice lawsuits.

    Would you mind addressing how a change in the political culture would affect these companies?     Reply
  • commenter
    Richard Shaw
    Aug 04 03:27 PM
    My Website
    31 S&P 500 Stocks with Negative 3 FY Net Income [view article]
    No I mean average Reply
  • commenter
    User 208427
    Aug 04 01:18 PM
    31 S&P 500 Stocks with Negative 3 FY Net Income [view article]
    I think you mean cumulative 3 year losses, not average.
    Reply
  • commenter
    Charles
    Longfellow
    Aug 03 04:07 PM
    My Website
    31 S&P 500 Stocks with Negative 3 FY Net Income [view article]
    There are reasons to question the significance of the S&P500, at least in terms of what it actually represents. For an interesting view on the subject see article and comments at:
    www.clusterstock.com/2...     Reply
  • commenter
    jbde
    Aug 03 10:40 AM
    Infamous Anniversary - Cramer's Stop Trading! (8/1/08) [view article]
    Will Cramer fall on his sword? One year from now, will he admit he got it wrong? That he knew nothing, that he had no idea!

    SBUX just sells over-priced coffee. Over-priced was a fad that has faded as the 'new rich' those who had money to through around like water to live a pretend lifestyle now find their gravy train of home-equity and credit card cash is at an end. To this end, SBUX has tried to reinvent itself through selling food??? Why compete with the likes of McDonalds? So what did McDonalds do, they began to sell 'up-scale' coffee as a simple menu move for big profits and a crush of SBUX's core business. If McDonalds find it necessary, they will put in WiFi areas with an intimate atmosphere - and then SBUX has nothing unique to offer. SBUX is having to close stores - stores that were put in 'trendy' spots with high rents as everyone trampled each other to sell premium items at 'fluff' prices. $4 scoops of ice-cream come to mind as well.

    Now for CROX, sure the shoes were 'fad' but the redeeming qualities of Croslite is being supporting, comfortable and most importantly odor-proof are unique and hard to duplicate. Court victories against the rip-offs are falling to CROX. As a relatively small company, although some 800MM in sales this year, it has broadened it product line in shoes and apparel and is moving form its core products. This process takes time, but not much. As a brand it is not a fad. As it garners shelf-space and a growing presence through company owned stores to showcase its entire product line, it will return as a cash machine and will likely be taken out instead of being allowed to be a competitive force. As for scare talk about bankruptcy, they are far from it. This talk enables the bears to cover their shorts and even go long. What the short position fall over the next couple of months as the shorts find something else with downside potential. The smart money will tell what it going to happen.

    In the near term, market rallies that make the public assume that all is well, will raise all boats, including the likes of CROX and SBUX. So let's see the percentage moves for each using Friday's close as the benchmark - SBUX 14.42 and CROX 4.44. Timeframe - by the election.

    I do not have a position in either stock. My position was long CROX at around 7 and sold at 9.88 the day it ran to 10.55 as the shorts got gunned before the shoe was dropped the next day. Pun intended. I believe that CROX presents a better chance of a 50% trade in the next couple of months than does SBUX.     Reply
  • commenter
    truthinvesti
    ng
    Aug 02 04:09 PM
    My Website
    PowerShares FTSE RAFI Healthcare: Big Bets on Dow Dogs [view article]
    nice article in my bargain bin thread those top 3 holdings are all my selections as well. Reply
  • commenter
    Kaiser
    Aug 02 01:29 PM
    Infamous Anniversary - Cramer's Stop Trading! (8/1/08) [view article]
    This guy is wrong more then right he lowers wall st to the gutter Reply
  • commenter
    mmf2008
    Aug 02 01:24 AM
    Infamous Anniversary - Cramer's Stop Trading! (8/1/08) [view article]
    Get the jim cramer fed rant one-year anniv widget here:
    madwidget.cnbc.com     Reply
  • commenter
    BlueAmerican
    Aug 01 07:24 PM
    Wall Street Breakfast: Must-Know News [view article]
    It isn't the unions that has caused the downfall of GM. It is healthcare costs for retirees. GM can compete against Toyota. It cannot compete against Japan. If we had universal health care coverage in this country and American companies could get out of having to offer healthcare benefits to it's employees then GM would be in better shape. And before someone starts screaming about socialized medicine let me state a few observations. Healthcare is not free. It costs money to provide good healthcare and money is a finite resource. Everyone has an obligation to take care of themselves by eating right, exercising and not smoking. (Tobacco companies use to get government subsidies, why shouldn't lung cancer patients) But every American citizen has a right to decent healthcare. One of the things that made America great was the availability of a free education to everyone, just not for the rich. Modern medical technology is expensive. Some CEO shouldn't get rich by saying no to the insurance company saying no to my medical care. Why would you want to be part of a society that put greed above the well being of it's citizens regardless of economic class. Let's have compassionate capitalism in America. Money isn't isn't evil but the love of money is or so they say. Reply
  • commenter
    jackooo
    Aug 01 03:36 PM
    My Website
    Wall Street Breakfast: Must-Know News [view article]
    I worked for TWA and was a union member for 34 yrs. TWA went thru 2 bankruptcies. The I.A.M. slept with TWA. Unions are a waste at this time. They were great in the beginning but useless now.
    If you fly straight you don't need them. If you have problems there is the Labor Board.     Reply
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