Vivus, Why the Slide? Message Board

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Biotech / Medical : Vivus, Why the Slide?

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To: Frostman who wrote (2895)	7/30/1997 8:49:00 PM
From: Richard Singer	of 3991

IMHOFWIW- VVUS has continued to find good support at 26, and I'm feeling pretty good about my position. I'm still patiently waiting for some follow-thru after one of these rallys. Although this has not yet happened, I get the feeling we may be close--the additional coverage of another quality institution sure won't hurt! I keep playing with the 3rd quarter and I can't see Vivus doing less than 30 cents. To keep it down to 30 cents, I had to cut gross margin 10 points to 61%, raise all expenses by 5% and lower interest income by 10%. I did, however, include the 2 million for the Great Britain approval. 27 + 28 + 30 = 85 cents for 9 months. To get to First Call's current mean EPS of 1.13, we have to do another 28 cents in Q4. These are VERY achievable numbers and the big revenue explosion should come next year. So given the possibilities, what kind of multiple of that 1.13, or the high target of 1.26, does this stock deserve? The analysts' 12 month targets suggest they think something in the 30-35 range would be reasonable and so do I. In fact I'll go with the 1.26/share and the 35 multiple, which gives me a 12 month price target of $$$$$44.

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