THE MORAL HIGH GROUND

The DC City Council voted 12 to 1 to recognize marriages performed in other states (like Iowa and now Maine). In case you missed Jon Stewart last week, here’s a quick clip of the one hold-out – former DC Mayor Marion Barry. Ah the righteous.

Speaking of which, both Jon Stewart and Bill Press commented last week on Obama’s discontinuation of the well-publicized National Prayer Day services Bush conducted in the White House on each year . . . quoting Jesus:

“And when you pray, do not be like the hypocrites, for they love to pray on the street corners to be seen by men. . . . But when you pray, go into your room, close the door and pray to your Father, who is unseen. Then your Father, who sees what is done in secret, will reward you.” Matthew 6:5-6.

Oops.

EUGENE ROBINSON MAKES THE CASE IN THE WASHINGTON POST

Not Bishop Eugene Robinson, the white gay one, whom you might expect to be making a case for equality, but columnist Eugene Robinson, the black straight one, who does it beautifully here. Forward to your Congressperson and Senators?

THE BEST STOCK CHRIS HAS EVER SEEN

Remember CRTX written up here at $3.80 three weeks ago? It closed Friday at $7.28. Here’s Chris Brown’s latest thinking as offered to some of his investors. (I understand only the portion I’ve bolded.)

Earnings will slack off moderately in Q2 due to generic competition on Hyflo, partially offset by continued growth in other marketed products, which will continue to grow. Deal with Italian firm will close in q3, causing essentially 100% dilution of shares. In exchange for this, company gets $15 mil in cash and $30 mil revenue stream from surfactant product which they feel they can grow considerably via market share gains (my estimate is perhaps to $60 mil over three years). Margins on surfactant revenue are unspecified but per conference call will be extremely high. Disappointing that CEO and one other executive have sold shares at $5.50 as part of the transaction. Company will be 51% owned by Italian firm after close of transaction. Company states they will provide updated guidance on rev/earnings at that time.

Including the dilution, visibility for 2010 EPS is at least 80 cents per share per my estimate vs. single analyst estimate of $1.27. Given the run from $3.80, stock has certainly lost status as “most undervalued I’ve ever seen,” could conceivable trade down to mid-$6 range in coming weeks (8x my estimate of 2010 eps visibility). On the other hand, solid long-term revenue and earnings growth seem extremely likely once deal is consummated; for those with a long-term perspective, company is still attractive, as management team and business fundamentals are very strong.

☞ So I hold on.

 

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