Thursday, March 7, 2013

Why VIVUS Is Poised to Keep Plunging

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, biopharmaceutical company VIVUS (NASDAQ: VVUS  ) has received a distressing two-star ranking.

With that in mind, let's take a closer look at VIVUS and see what CAPS investors are saying about the stock right now.

VIVUS facts

Headquarters (founded)

Mountain View, Calif. (1991)

Market Cap

$1.1 billion

Industry

Pharmaceuticals

Trailing-12-Month Revenue

$2.0 million

Management

CEO Leland Wilson (since 1991)
CFO Timothy Morris (since 2004)

Return on Equity (average, past 3 years)

(52.8%)

Cash/Debt

$214.6 million / $0

Competitors

Eli Lilly
GlaxoSmithKline
Pfizer

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 16% of the 428 members who have rated VIVUS believe the stock will underperform the S&P 500 going forward.

Earlier this week, one of those Fools, chrispycrunch, cautioned our community about getting too excited over VIVUS' new obesity drug Qsymia:

This is not the company to own. The insiders have been selling. The drug itself has risks, which will turn off many potential subjects even if deemed safe for them to own. There are drug alternatives coming to market (ie [Arena Pharmaceuticals]) which will hurt [VIVUS]. Beware. [VIVUS] also cut prices, because the free trial did not boost sales.

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