The capitulation is a welcome sign that a low is near. Let me give you some Idea of how oversold I believe this stock to be. After reading the aarticle from fortune, I cannot believe that zona has escaped the lawsuits. Fortune makes them out to be very deceitful.
Zona has 11.5 mil shares priced at 19, down from over 45, with whopping revs last year of 3.2 mil. This give them a market cap of over 200 mil. They are selling at 70x revs with no earnings and no product on the market.
Vvus has 33mil shares is selling at 11, down from 42, with revs of 130 mil in three quarters. This gives them a market cap of approx 360 mil. They are seeling less than 3x revs with eps of over $1 and the best new product on the market. Don't forget about the 10 mil shares short. Do you guys see this?
From reading the article in fortune, these pills are almost described as a recreational drug. The fact that a requirement for the oral testing was having to had sex at leat once during the lead in should speak volumes. I have no doubt that these pills will fly off the shelf for the man seeking help for mild ed and the man looking for some staying power. But when it comes to real cases, not the newly expanded definition of ed, vvus will shine. We know from the clinical trials that vvus was effective in 64.9% of the men. If Dr. Nathan P. is saying it was 30% and claiming 80% for viagra, I will assume 40% for viagra in the clinical trials.
The stock was down today most likely in reaction to the suits filed friday. There are things that can go wrong, plant delays, approval delays etc. But imo if you sell your stock here you will be another in the long list of bottom sellers. Remember, if you were part of a short position that was almost half the float, you would work like hell to keep that stock down. Good luck! |
