Credit Suisse Bashes Arena Pharma (ARNA)
Interesting that CS chose to downgrade the obesity drug maker on the day of one of the biggest rallies in recent memory. The DOW rose +250 points, the Nasdaq +66 points, and the S&P 500 rose nearly +30 points today.
Shares of Arena were down -5%.
Kalowski, of Credit Suisse, initiated coverage of Orexigen with an Outperform rating and Arena with an Underperform. Kalowski already rates Vivus at Outperform.
Orexigen has a “favorable risk/reward profile around the pre-approval cardiovascular outcomes trial,” and Vivus as recent “concerns relate to matters that are not new.” But Arena’s prospects may not be as promising, says Kalowski.
“ARNA commendably ushered Belviq through FDA; we believe that sales (ARNA has an approximately 35% royalty) will fall short of the market’s lofty expectations,” he wrote.
Mastery Bottom Line
Mr. Kalowski of Credit Suisse must have written this little piece after snorting a fat line of bath salts.
Anyone who has been following Arena for a while knows that the stock has very low institutional ownership. In fact, around the time that Arena received its FDA approval for Belviq, it was approximately 20% institutional-owned. In the last couple of months it has risen to approximately 32%.
Credit Suisse doesn't have a crystal ball and neither do we. No one knows at this point whether doctors will prescribe Belviq more or Qnexa more. Arena has a lower risk profile so we tend to think that Belviq will be prescribed more, but again, we don't have a time machine.
This seems like a pretty blatant attempt from CS to hold the share-price down so intituitions can continue to back up the truck.
Best of the Blogs
Scanning and identifying the best blog entries every hour
- Self-Aware? World's Largest Hedge Fund Shifts Strategy To Artificial Intelligence | ZeroHedge
- Warren Buffett Releases Monster 43-Page Half-Century Letter To Berkshire Faithful | ZeroHedge
- Market Wrap: Futures Fractionally Red Ahead Of Pre-Weekend "Nasdaq 5000" Push | ZeroHedge
- Uneven Housing Recovery in Pictures | Financial Sense
- Gold Sovereigns Bought by Greeks in Volume - Bank Runs and New Greek Drachmas Designed | ZeroHedge
- The Recovery, Unemployment, and Earnings Are All Based on Fraud and Accounting Gimmicks | ZeroHedge
- Europe’s Survival Depends on Debt Restructuring, Not Growth | Financial Sense
The most relevant financial news and articles from the Internets
- 9 books that billionaire Warren Buffett thinks everyone should read | Business Insider
- McIlroy struggles in wind, unheralded Herman leads... | Business Insider
- Four ways to break the universe's speed limit | Business Insider
- Leonard Nimoy and Zachary Quinto teamed up to make the... | Business Insider
- The two women behind the viral dress have a plan to turn it into... | Business Insider
- Streetinsider.com's Hot Lunchtime... | StreetInsider.com
- Lloyds just posted a MASSIVE 325%... | Business Insider