Janice and All,
Look, I think you guys are a little paranoid about Sood. The guy is not evil, and he's not manipulating the stock. And the truth is, is was partially right about it.
I read the article you speak of: He didn't raise any questions about USRX. All he said, is that he thought the March quarter would be "challenging."
What did you want him to ask management? If the March quarter was going to be strong or not? That would have been silly, since USRX spoke of the March quarter in their forward-looking statements. Saying that it totally depended on the acceptance of x2, and so on.
Obviously, he views the current quarter as "transitional." With that, he is maintaining his "Buy" rating on USRX, but is saying that it is more of a long term thing, and that there was is no rush to get in right away (because "there isn't much to look forward to for this quarter"). I agree--I'm looking to buy USRX, but not just yet.
By the way, USRX *did* meet their EPS numbers, but the "quality" of those earnings are, in fact, subject to scrutiny. The truth is, revenues were weaker than the earnings numbers. And IMO, revenues are more important, because they are more pure. "Pure," in the sense that it's more difficult to manipulate revenues (assuming that all revenues are realized in the correct manner). On the other hand, net earnings can be manipulated by things like lower expenses, and some other non-recurring items. There is nothing wrong with this, but analysts would prefer than companies have higher "quality" earnings--that non-recurring items and expenses not contribute materially.
And if you notice, it isn't just Sood who isn't too exited about USRX in the near term. Analysts all over Wall Street were lowing their numbers today....
Sal Habash
P.S. There is no way that Sood is going to do a conference call with non-H&Q client individual investors. |
