RE:RE:RE:More bad press
Its the same arguement for VRX and NHC and any other shorted stock.. future earnings will be lower than forecasted .. .government will regulate.. blah blah blah..
The process is not that fast. Its not like overnight the drug prices are about to fall. By Q2 (June 2016), the Company will already have EARNED half of its forecast. That is approx. $2.70 to $3.10 USD. So what does that mean? The last 2 quarters (strongest traditionally) would have to be the weakest ever recorded to get to say $4.00 USD (lets play imaginary land and assume CXR is able to pump out $0.50 for Q3 and Q4. At its current price of aobut $26.50, that's about a 6.6x 2016 earnings multiple.
Bottom line is that the shorts, like the longs, are making A LOT of assumptions in their prices. No one knows what the future holds but fundamentally, the longs assumptions are significantly stronger than shorts. Drug prices are an election issue. Look at pharma history and you'll see this "outcry" occurs literally every 5 to 7 years. After its over, everyone gets back to business and starts the pricing jacking. So even if CXR is forced to reduce its price, it won't stay there long.
My 2 cents