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Medivation Reportedly Yielding To Buyer Interest; Stock Surges

Shares of rising biopharma player Medivation ( MDVN ) jumped to an 11-month high Monday on reports the company now is willing to sell itself. Citing an anonymous source, Reuters reported that Medivation had signed non-disclosure agreements with Pfizer ( PFE ) and Amgen ( AMGN ), both of which were previously rumored to be interested in buying the company, while Sanofi ( SNY ) went public with its uninvited $9.3 billion bid last month. It still isn’t certain that those companies will actually bid, Reuters said. Medivation stock was up modestly in morning trading on the stock market today , but shares surged after the report came out in the early afternoon, eventually closing up 4.3% at 62.59. Medivation had initially resisted being bought by anyone, and in late March it reportedly hired advisers to help it fend off such attempts. The reason was implied by CEO David Hung in his refusal of Sanofi’s offer , when he accused the French pharma major of taking advantage of “market dislocation” that he believed led the market to undervalue Medivation’s stock. Medivation’s value has continued to go up since then, taking the stock to within 5% of its 52-week high last May. With an IBD Composite Rating of 97, putting it among the top 3% of all stocks in key metrics such as sales and earnings growth, it sits at No. 49 on the IBD 50 list of top-performing stocks.

Drew Industries’ Earnings Report Pushes RV Stocks Higher

The recreational vehicle market has been on an upswing in recent years as more Americans decide an RV is a better way to see the country. The RV and manufactured home industry group ranked No. 54 out of 197 groups as of Monday. It’s stumbled a bit, down from No. 11 six weeks ago. But it got a boost from the action of one leading member of the group, Drew Industries ( DW ), which reported earnings Monday morning. The stock gapped up and closed for a significant gain on big volume to a new all-time high as a result. Earnings came in at $1.45 a share, a 77% increase from a year earlier. Revenue rose 17% to $422.8 million. Analysts were expecting EPS of $1.03 and revenue of $403 million. EPS growth has been accelerating from 4% to 9%, 61% and 77%, an extremely bullish sign. Drew makes components for RV manufacturers, including doors, axles, mattresses, appliances and furniture. Drew’s earnings report helped boost the group to a strong gain Monday. RV growth is driven by demographics and lifestyle changes. One in 10 vehicle-owning households owns an RV, according to industry statistics. Eleven thousand baby boomers will turn 65 each day for the next 15 years, and they make up the strongest segment of RV owners. More people embrace outdoor activities, and millennials tend to be campers, who eventually end up buying an RV. Drew wasn’t the only stock helping the group to a gain Monday. Thor Industries ( THO ) hit a new high Monday on above-average volume. It’s extended from a 63.09 double-bottom buy point. Thor owns numerous RV brands, including the iconic Airstream brand, along with Dutchman, Heartland, Bison and CrossRoads. It makes both motor homes and travel trailers. It says it holds down costs by assembling RVs and buying components from other manufacturers. Besides Drew, one of those manufacturers is Patrick Industries ( PATK ), which makes components for the RV industry. It broke out of an awkward base without much volume in March. The buy point was 45.41. It’s since made a new high, but pulled back and has recently recovered its 50-day moving average. In its latest earnings report, EPS was 80 cents a share, besting estimates of 70 cents, and a 36% increase from a year earlier. Revenue was $278.63 million vs. estimates of $270 million. Despite the beat, the stock closed down 4.6% that day. The stock has worked its way back near that close.

Stratasys Earnings Beat Gives Short Lift To 3D Printer Market

Stratasys ( SSYS ) posted a first-quarter earnings beat before the market open Monday, sending its stock — and that of rival 3D Systems ( DDD ) — up in early trading, though both stocks reversed by midday even though Stratasys’ sales guidance for the year also edged above views. Stratasys reported revenue of $167.9 million, beating the consensus estimate of $164.8 million by analysts polled by Thomson Reuters. That’s down 3% year over year but marks an improvement from the 20% year-over-year drop in the previous quarter. Earnings per share minus items of a penny fell from a 4-cent profit in Q1 2015 but still beat Wall Street expectations for a 4-cent loss. Stratasys beat on earnings during a difficult period for 3D printer companies. Competitor 3D Systems reported Q1 earnings Thursday that showed a third straight quarter of year-over-year declines in sales and missed Wall Street expectations. Stratasys stock jumped as much as 12% early on the stock market today , but it ended the day down 1.3%, at 20.79. 3D Systems stock rose as much as 2% at the open, but it ended the day down 3.7%, at 12.68. Another 3D printer maker,  Voxeljet ( VJET ), fell 1.9% on Monday. Stratasys said it sold 5,125 3D printing and additive manufacturing systems during the quarter. “Although the overall market environment remains challenging, we made significant progress in improving our operating efficiency during the first quarter,” company CEO David Reis said in the earnings release. “We believe the recent refinements to our operating structure will make us more productive and better position us for future growth.” Stratasys guided 2016 revenue at $700 million to $730 million, with the midpoint slightly ahead of the analyst consensus estimate of $713 million. It projects EPS minus items of 17 cents to 43 cents, with the midpoint meeting views of 30 cents. For 2015, Stratasys posted EPS ex items of 19 cents on sales of $696 million. Piper Jaffray maintained an overweight rating on Stratasys stock, with a price target of 32. “Following the upbeat results, we remain confident in Stratasys’ future and bullish on its long term opportunity,” Piper analyst Troy Jensen wrote in a research note. “Although we believe it will take 1-2 additional quarters to see system sales improve, we believe interest continues to grow and are confident printer sales will show significant improvement in the second half.” Cowen analyst Robert Stone maintained a buy rating and price target of 23 on Stratasys stock, but he said overall visibility was still limited.