SUNDAY MORNING

CBS Sunday Morning with Charles Osgood, formerly with Charles Kuralt, is just so good.

I don’t mean good the way ‘Scrubs’ or ‘Seinfeld’ reruns or ‘Malcolm in the Middle’ are good – though they’re great. I mean good as in deeply civil, intelligent, the best-of-our-natures. I mean ‘Ted Koppel’ good. ‘Walter Cronkite narrating ‘I Can Hear It Now – the Sixties” good.

So if by chance you’ve never given it a try . . . do. And if its time slot interferes with going to church, well (ironically), that’s why God invented TiVo.

Yesterday morning I learned, among other things, that Donovan is not gay – I had just assumed – and that (get this!) film director Norman Jewison (Moonstruck, In the Heat of the Night, Fiddler on the Roof) is not Jewish.

These tidbits are hardly examples of reasons to watch CBS Sunday Morning – they are not good – but I thought you might be able to win a little money with them in bar bets.

If CBS Sunday Morning overlaps with This Week With George Stephanopoulos where you live, then you have a problem; but that’s why God invented two television sets – one to watch, one to TiVo for later. Or else why He invented the service that many of the cable companies now offer where you can watch one live show while recording another. (With most TiVo setups, you can only watch a previously recorded show while recording another. Which is one of the reasons I own just a few shares of TiVo – I think they will somehow pull this out, but they well may not. I own these shares for love, not money. If Charles Osgood started selling shares in CBS Sunday Morning, I’d buy a few of them, too.)

THURSDAY

Hats off to the people of Iraq for turning out to vote last Thursday, and to our military for their incredible work and sacrifice in helping to make it happen. It’s heartbreaking to think of the costs and maddening to think of the mismanagement – we really did rush to war without a plan to win the peace. And one would be foolhardy to think it’s necessarily going to end well even now. But Thursday’s election was still a great step in the right direction.

FRIDAY

Nitromed closed Friday at $15. If you bought the December 30 puts five months ago when we started this discussion, you were up around 85% (before taxes) when they expired Friday afternoon.

(Why? Because you paid $800 or so for the right to sell 100 shares at $30 each that, as things turned out, were worth only $15. That’s a valuable right to own! It’s like having the right to sell your $150,000 house for $300,000. Wouldn’t that be a valuable little slip of paper to carry around in your wallet?)

  • If you bought puts at a different strike price back then – the 25s or the 20s, say – you made a similarly good profit.

Not bad for five months, although the gain did not come without risk. I felt pretty good about this one, or would not have written about it over and over; but there are no sure things on Wall Street (apart from the fees and commissions), so those who did not have money you could truly afford to lose were wise not to take this this bet.

  • If you waited and bought puts after the stock had fallen somewhat, you made less (unless you had the exceptional timing to cash in your puts a few days ago, when the stock got as low as $13.24).

But what if you bought puts that didn’t expire Friday? What if you bought puts that don’t expire until March or June? Now what? Take your profit?

On the one hand, the NAACP has joined the bandwagon of organizations friendly to Nitromed’s sole product, BiDil. (This could be in part because Nitromed has given the NAACP $1.5 million.) And bulls on the stock are hoping Medicare and others will soon begin to require only minimum co-pays in covering the drug, and that sales will really begin to take off – especially now that the free sampling is winding down.

On the other hand, the analysts at UBS have lowered their 2005 sales estimate from $30 million to $4.7 million (while leaving their $32 price target for the stock unchanged) and the company is losing several million dollars a month.

Over on the Yahoo Finance message board, interspersed with all the messages with people calling each other stupid (and worse), there have been a few doctors, like the one whose post I linked to last week. All pretty much back up the thesis of the guru who pointed me to this in the first place: BiDil is not for all 750,000 African Americans suffering from congestive heart failure, just for a small subset quite far along with the disease. And for them, it seems dubious to prescribe BiDil for $4,000 a year (six pills a day), when its two generic ingredients have long been widely prescribed and are available at perhaps a sixth the cost.

Prescriptions are slowly rising; but they are just not in the right ballpark. As of December 14, the 7-day rolling average of prescriptions written was 132.9. (This is actually down from 240 a few days back, but the general trend seems to be up.) At 90 pills per prescription, that would be about $8 million in sales for the coming year, versus $120 million in expenses. UBS thinks the stock should be $32 – about $1 billion for the whole company – because it expects sales to skyrocket.

Yet even at Friday’s price, buyers were valuing the company at $450 million.

If the sales rate quadruples from here, the company would lose “only” $80 million next year instead of $110 million – nothing to rush out and pay $450 million for. One never knows (really!), but I wouldn’t be surprised to see the stock in single digits before too long, which would be good for our puts.

 

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