Media Makes Schering-Plough Stock ‘Radioactive’
7 CommentsBy Ed Silverman // September 3rd, 2008 // 7:19 am
The headlines about Vytorin are too much for Jim Cramer, the effusive host of CNBC’s Mad Money, who cites the relentless media coverage about the controversy over the cholesterol pill as the reason for selling Schering-Plough stock from the charitable trust that he runs.
“It’s the press coverage, not the side effects that made me want to sell,” he says in this video clip. “The articles are so hurtful, so damaging that I now believe the press itself will get the drug pulled from the market.”
“Heaven knows, the companies have not show much dexterity in their handling of the problem…The reporting of the negative news has become ‘the issue,’ not the drug itself,” says Cramer. “…The constant articles have made the stock radioactive.
Matthew Holford
No doubt Jim Cramer is a financially successful guy, but I don’t think much of his due diligence! Bad press is the thing that made him bail out? Surely, if the companies were any good, then the stock would recover, or is it the case that he just think everybody else will be impacted by the bad press, and sell, whereupon his portfolio will suffer severe losses, which will not be recovered for some time; longer than he’s prepared to wait, in fact?
Thing is, if the companies have engaged in dubious activities to get their product sold, then it’s likely that that’s a modus operandi that it follows, regularly. And it’s a big “if,” because I haven’t looked at this story, at all, let alone in any depth. But I’ll bet you that Cramer has.
Matt
Condor
Cramer? The guy is a side-show-tent freak.
A carnie. A huckster. Nothing more.
Let’s review his history — just with Schering-Plough picks (forgetting ALL the other times he’s been wrong — about other stocks): at $26.30, he called it “cheap” — told people to “back up the truck” (Buy loads of the stock). And, his rationale? “Fred Hassan is my neighbor. I like him.”
At $22 — He called SGP a “screaming buy” — again said the press was wrong about the stock.
At $16 — “Time to Buy” (The stock did recover from here, but not for any of the reasons Cramer cited.)
Finally, now — at $18.90 — he sells. What? He had long ago said his trust bought a bunch at $26 and change.
Well — THAT’S a guy whose advice I’d want to follow. Not.
BTW, Huckman at CNBC has a good one — as does Matt Herper — yet ANOTHER great piece in Forbes this morning, on Vytorin study’s ethical “morass” — do take a look:
http://shearlingsplowed.blogspot.com/2008/09/vytorin-studys-ethical-morass-forbes.html
Cheers!
Former SP
No, the actions of the top management team have made the stock “radioactive.” They have made mistake after mistake after mistake, guided by their over-whelming greed, and deserve what they get. Hopefully, justice will eventually be served, but here’s betting they slither out of it!
SP 2
Maybe God is simply angry with these bozos!
Piper
Hell must be freezing over. I find myself in agreement with both Cramer and Condor today. Cramer is right that “the companies have not shown much dexterity in their handling of the problem” and Condor is also right to say that Cramer “is a side-show-tent freak”. He makes some horrible stock picks!
Justice in Michigan
Watch the clip if you haven’t. Cramer repeats that the reporting is all accurate, that Berenson is great, that, if he were Berenson, “I would do the same thing,” etc.
But there are just too many bad stories, in his view, for the drug to survive. The FDA will be forced to pull it. No mention of their pulling Zetia also.
It may or may not be a good investment, but the notion of FDA pulling it (unless there is more into “stocked away” (so to speak) somewhere, makes no sense to me.
Interested Party
The negative press coverage is a result of the inexperience of the head of communications. Someone needs to take control of the situation and help this guy out.