Diamonds and Dogs
Today's diamond is acting valiantly. After dropping nearly 100 points in a single month, Valeant Pharmaceuticals (VRX) is on the mend up 15% today. Valeant made a 52 week low last month at $69.93 per share, but is currently trading 57% higher as fears of accounting scandals subside. Short sellers jumped all over this stock this fall on accounting issues and their questionable use of the pharmacy network, Philidor. Since then, Valeant no longer uses Philidor while this morning Valeant released a deal with Walgreens for pricing and distribution pact. The deal with Walgreen will cut prices on their branded prescription-based-skin and eye-care products by 10%. The purpose of the cut will allow a more efficient model to lower cost and allow patients to more convenient access to the drugs their doctors prescribe, but the fact that Walgreen is working with Valeant is a good sign.
Stick-it notes won't save 3M this quarter. Industrial giant, 3M (MMM) known for among other things stick-it notes is down 5% after reducing their outlook from an already reduced outlook of $7.73-7.78 EPS to today's new outlook of $7.55 EPS. China has been a big culprit for 3M with 10% of their revenue coming from that region. A strong dollar hasn't helped either since it selling and operates in more than 70 countries. The company is tightening their belt cutting costs and reducing their workforce by 1500. In the long run the cost cuts will improve earnings, but in the short term the company needs to improve sales until the cost cuts take effect.
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