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  • Short Sellers Flee Questcor On Sentiment Reversal [View article]
    Brian: re 'the "easy money" has been made', I have two reservations. First, it wasn't "easy" at all, and if I had still had any hair, it would all be grey by now!

    More important, and especially given the burgeoning rumors of a huge Q2 EPS rebound, it's hard to see how calendar 2013 could be under $4.50, and more probably will be at least $5.

    With the suspected rapid growth of the RA indications, and (at least) no fall in current MS+NS+IS prescriptions - plus the fact that revenues and EPS all but doubled in 2012 versus 2011, it's equally hard to see how not to expect AT LEAST 20% annual growth in the next few years.

    It is the short stories (and perhaps also the US investigation) that have held back the multiple, and you correctly point out that the shorts are more and more squeezing throught the exits.

    So, if you concede even a relatively conservative $5 EPS for 2013, and then a 20% CAGR for EPS, and hence (still conservative for a growing pharma stock) a 15 multiple, then it's reasonable to expect a $75 PPS by year-end (5 x 15).

    Might explain why $75 options just appeared for QCOR! My analysis here is still too conservative IMO.
    Jun 18 10:00 AM | 10 Likes Like |Link to Comment
  • Was The Aetna News Overblown? Blue Cross Blue Shield Supports Questcor's H.P. Acthar Gel [View article]
    SciFi: Thanks for the QCOR article and the BCBSKS update in particular! I felt bad after making my bloated "comment" that I had not even expressed thanks.

    We QCOR longs have such deep wounds that we suspect everyone of adding salt when they do not sing the whole dirge, at least that's my excuse.

    So I shamelessly exploited the opportunity you "provided" to try and sing the whole song for any potential new investors who might be lurking.
    Jun 3 08:06 PM | 1 Like Like |Link to Comment
  • Was The Aetna News Overblown? Blue Cross Blue Shield Supports Questcor's H.P. Acthar Gel [View article]
    WAC: How did you "learn to understand" such a shallow lesson? You would never invest in a water company, an electric company, a garbage-collection company, etc., etc. - because those are (respectively) their only products?

    Isn't it more a matter of the product's utility in relation to competing products, the efficiency (profitability) of the operation, etc. (ie. the usual suspects)?

    The deeper perception about Acthar seems to be that it stimulates the body into a natural health-giving/restoring reaction to a prior attack on itself, and that even Questcor may have not yet found all the applications (varieties of self-attack).
    Jun 1 10:31 AM | 6 Likes Like |Link to Comment
  • Was The Aetna News Overblown? Blue Cross Blue Shield Supports Questcor's H.P. Acthar Gel [View article]
    The general tenor of your argument seems sound. It might have been as well to remind readers that that the highly-coordinated short-attacks on QCOR, last July and September, operated on three fronts, one of which was insurance reimbursement, as you state. The other two were the alleged probability of (cheaper) competing products, and the threat of a large fine, stemming from an investigation into marketing practices by the activist US attorney in E. PA.

    I think it’s fair to say of these two additional issues that (1) the threat of either a generic or synthetic competitive product being introduced in the US is AT LEAST as remote as it was last year (and in fact there is a fair chance that research now underway could eventually result in a renewal, beyond 2017, of the Orphan Drug designation - for ALS, this time) (2) the US action is going to take at least another year or two to be resolved, but that there is no known evidence that the result could be substantially damaging to the balance sheet, if indeed anything at all ever emerges.

    There are two additional (main) problems for QCOR, broadly speaking:

    (1) the fall in the PPS last year led to a number of private class-action suits, to the effect that Questcor had misled investors, etc.. The company has stated that it will move to have these actions dismissed, this coming September. The suits seem to have very little merit.
    (2) Q1 results were a considerable shock to the downside, breaking the exponential growth curve through the trend of earnings (2012 was generally about double 2011). Folks are waiting for Q2 (end of July, or so), to see whether inventory and product code disruptions/issues (and maybe MS seasonality) really explained the whole “shortfall”, or whether the new Reimbursement Center was unable to process all the potential insurance claims as efficiently as its predecessor. Look for non-GAAP about $1.40 as indicating Q4 (too high) and Q1 (too low) were off-trend, and that all is (very) well.

    Maybe the Company will revert to publishing, or at least indicating, what they know of sales on a monthly basis. In the 2012 Q3 call, they said they would stop doing that, on legal advice (see (1) above). But since there was a broad hint about how good April looked in the recent call, maybe they’ll also now say something about May, at one of the conferences?

    The other short-run catalysts are that buybacks tend to be especially strong in June (there were none in Q1), and that, for whatever reason, the short squeeze is just one match-on-the-gasoline away from exploding.
    Jun 1 06:30 AM | 11 Likes Like |Link to Comment
  • Serious overcapacity in China's steel industry is unlikely to ease in 2013, which could continue to hamper steel prices (SLX), analysts say at Platts Steel Market Europe conference. China is set to produce ~750M metric tons of crude steel in 2013 while capacity will rise to 950M, putting heavy pressure on steel prices in Europe and in the world steel industry as a whole. [View news story]
    Econ 101 says a shift to the right of the steel-supply curve is a POSITIVE for iron-ore suppliers (this was sent to CLF subscribers as well as MT).

    The price of steel falls, quantity demanded increases, so quantity of iron required also increases.
    May 23 09:03 PM | Likes Like |Link to Comment
  • Post Guidance Bomb, LinkedIn Is Still Insanely Expensive [View article]
    Fun, informative, straight-talking, thought-provoking read on LNKD. Thanks, Cory.
    May 6 08:55 AM | 1 Like Like |Link to Comment
  • Silicon Motion: Sifting Through The Wreckage [View article]
    Ashraf: on the cc, the company said that the LTE transceiver business with Samsung had been lost to Qualcomm, because Samsung had suddenly decided to adhere to the new "carrier aggregation" standard. This was apparently totally unanticipated by either party, or at least by SIMO. They plan to add the required feature in the next round of product improvements but, by that time (2014), one feels Qualcomm will have moved still further ahead. The company reps on the call sounded increasingly rueful, as the analysts battered them about the sudden and major hit to revenues for 2013, that this loss of the LTE business will effect.

    Quite apart from all that, QonQ net sales decreased 19%, and diluted earnings per ADS (non-GAAP) decreased to $0.17 from $0.36. Q1 2013 earnings were also sharply below the 2012 Q1 result.

    I am not disputing the ameliorating and more hopeful considerations you adduce, merely commenting that you might have been a little more forthright about the reasons for the fall in the stock from 16 to 10 in the last 3 months (and - yes - it is pretty clear that the LTE news was leaked to most everyone but the retail investors, some time ago).
    Apr 29 07:26 AM | 2 Likes Like |Link to Comment
  • Questcor Pharmaceuticals: How Can Such A Profitable Company Be So Risky? [View article]
    pharmaman58: fabulously succinct and educational summary of the parameters for possible generic or synthetic competition - this matter is VITAL to the continuing QCOR investment thesis. TruffelPig (and others with his worries, expressed above) - ARE YOU LISTENING?! THEY ASKED THE FDA! Have you?

    In addition to the educational material in Michael Fuller's articles on SA, those wishing to learn about Questcor and QCOR should make a point of researching the original posts of pharmaman58 and mikeylikesit33_99, on the QCOR Yahoo Message Board. This is NOT the usual dross you find on that site, but top class investor-education material on ALL phases (medical, economic, health-industry, technical), and is a resource NOT to be overlooked.
    Apr 27 12:41 PM | 1 Like Like |Link to Comment
  • Questcor Pharmaceuticals: How Can Such A Profitable Company Be So Risky? [View article]
    6869451: since you really are a physician, I apologize 100% for my insults and innuendoes. I gather you have had a discussion with Michael, so perhaps he has already posted you on the economic aspects of Questcor's situation.

    Basically - when a company invests time and money for many years, enduring risk, uncertainty and multiple defeats and disappointments, then they expect to be able to recoup, if and when finally successful.

    This basic scenario is multiplied when the indication (IS) has a (relatively) VERY low # of potential sales. That is why the US governments offers incentives like ODD, so that these babies can actually get good treatment. Even young Socialists had better understand these matters (or find life frustrating, as Socialists long have, in our era).

    Please understand that Q's tribulations involved, among other things, solving multiple problems in controlling manufacturing quality, that Novartis apparently could not, and was ready to give up on. QCOR's 40 days and 40 nights in the wilderness were basically 2001-2010. You try it sometime.

    If it turns out that prednis(ol)one is really "just as good", then IS will become just like Questcor's other indications, where - as I'm sure you know - Acthar is given only when much or all else have failed.

    As already discussed, your callow notion - that Q is holding poor, sick people to ransom - does not hold up. It is often an "argument" used by shorts (ask Nomad!).

    Apr 26 07:46 PM | 1 Like Like |Link to Comment
  • Questcor Pharmaceuticals: How Can Such A Profitable Company Be So Risky? [View article]
    6869451: were you really a physician, as opposed to a thinly-disguised short/basher, you would know that patients with insurance are always covered by that provider (even if Aetna!), and that indigent patients without insurance are provided with free treatment by Questcor (or by a combination of Medicaid and Questcor).

    If you just can't stand the thought of ANYONE paying that much money, you can always prescribe steroids, though the cure-rate is only about 1 in 3, and such treatment is not recommended 1st-line by the FDA.

    The companies that provided Acthar before Questcor were universally planning on quitting doing so, for well-documented reasons, which is how Questcor became involved in the first place. As you should know, Questcor had many years of trial and experimentation, rejection by the FDA, and unproductive investment spending, until finally gaining the ODD and indications - so it is ridiculous to cite the uneconomic prices previously charged.

    But then you're just another short in quack's clothing, right?
    Apr 26 07:02 AM | 5 Likes Like |Link to Comment
  • Questcor Pharmaceuticals: How Can Such A Profitable Company Be So Risky? [View article]
    Truffel: I've usually enjoyed and valued your posts, but this one seems way below par, if I may say so.

    . when compared to other ODD drugs, Acthar's price is middling: how would you justify "excessively expensive", ie. in relation to what - its utility to its consumers (life-saving)?
    . I know you are too sophisticated an investor in the biopharma space really to suppose that either a generic or synthetic competitor could emerge "overnight". In most cases literally years of FDA-monitored testing would be required. All this begins with a Phase 1 announcement (if not before), and there has been none. The Cerium short-story seems to have ended in the dustbin of history. Do you have some other evidence we are all missing?
    . while benzylalcohol could surely be omitted/replaced, would there not be a need for new clinical testing? Why hasn't Novartis already announced an effort? Perhaps they haven't heard about the US market and the immense and growing success of Acthar?

    While your investments are your own concern, and though arguably the main risk to investing in QCOR seems to be precisely the kind of ignorance and irrational fear evinced in posts like yours, I venture to suggest you're missing a historic opportunity at least to double your money within a year. I recommend the 2014 and 2015 LEAPs for your perusal, if you still feel the common is too risky.
    Apr 26 12:36 AM | 3 Likes Like |Link to Comment
  • Intel: What Makes Mid-Year Different? [View article]
    Russ: "If the miracle of making computers...doesn't cause you to catch your breath, you have no soul, and should try to find your way back to the caves...".

    So if cavemen really had to contend not only with low living standards and life without ESPN, but also soullessness - when and how do you think it was that mankind acquired souls? :)

    [You and I are both old enough to remember how galvanized the cavemen in the movie "2001" were by fire - if they had only seen Haswell, they might have invented back-flips.]

    That said, I am inclined to forgive you your strange metaphysics, because nobody ever explained tick-tock to me before.
    Apr 25 05:33 AM | Likes Like |Link to Comment
  • Throwing Out The Baby With The Bathwater [View article]
    $SIMO? Also "insanely cheap" UNLESS Samsung really has dumped them, which I doubt, but am holding breath until forthcoming cc.
    Apr 18 09:24 PM | Likes Like |Link to Comment
  • An Open Letter To Bob Benmosche [View article]
    Todd: I remember your BAC articles from the Dark Days of 2011, and agree with Doyle's assessment above. I am also long AIG (though recently took some profits at 39, see below for a clue as to why).

    However, would appreciate some clarification of the "AIG is undervalued by book value" thesis. I am not an accountant by training.

    Is $60/share based on (1) the assets' original purchase prices, or on (2) a DCF capitalization of their current earning power, or on (3) what the assets could (theoretically) fetch on the market if sold today (AIG break-up)?

    In 2012, AIG made about $4/share (giving them a pass on the Q4 charges). If $60 of asset value can produce only $4 of net income then P/E is ~15, which seems about in line with the S&P. If the income-producing power of the assets is somehow temporarily impaired (case (2) above), then I can understand the undervaluation thesis, but is this in fact the case?

    If the above is NOT the case, and we go for case (3), then why would anyone pay the equivalent of $60/share if the assets can only produce $4? And if (1) is the BV basis, then it seems irrelevant to the PPS.

    I'm trying to keep this as conceptually clear as your fine article, but not sure if I succeeded. I guess the BASIC question I have is that the BV argument is getting long-in-the-tooth now, and one wonders why Mr Market is so stubborn as not to give AIG its due, now that the Treasury is way in the rearview mirror? Could this latter thought perhaps help explain why Ben is not as eager as you to gorge on B/Bs? Just trying to provoke you into a caustic response. Knock this down, please.
    Apr 4 09:03 PM | 2 Likes Like |Link to Comment
  • S&P 1500 Most Heavily Shorted Stocks [View article]
    BIG - just wanted to say "thanks" for posting this regularly. It is a valuable and interesting collation (imo).

    The one stock in the list, the #4, that I really follow, is QCOR. There is no, repeat NO, rational reason to go short this stock. Quite the reverse, actually. The ONLY reason this stock goes down is precisely because shorts produce lying reports that are subsequently shown up as 100% false (CitronResearch, Lafferty, flyonturd, etc.). People used to say a lot of the short interest was boxed, ie. institutions hedging the short attacks, but I doubt it. They've had plenty of time to clear their positions now, with a change of year, and months of churning in the 20s and low 30s.

    If someone can produce a valid reason to short QCOR, then my challenge is: post it hereunder! Convince more people, and we'll all go short too! [Deafening silence ensues...]
    Mar 28 01:09 PM | 5 Likes Like |Link to Comment