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
- VIX ETFs Are In Crisis Mode | ZeroHedge
- Frontrunning: September 1 | ZeroHedge
- When the Story Breaks | Financial Sense
- Chinese Stocks Open Down Hard As PBOC Strengthens Yuan By Most Since 2010 & Default Risk Hits 2-Year High | ZeroHedge
- Gold Up 3.5% In August, Stocks Fall 6% to 12% | ZeroHedge
- Unusually Massive Protests Erupt in Japan Against Forthcoming "War Legislation" | ZeroHedge
- Behold China's 2PM Ramp Capital | ZeroHedge
The most relevant financial news and articles from the Internets
- Which Is America's Best City? | BusinessWeek
- De Gea move to Real Madrid mired in confusion: reports | Business Insider
- One of Apple's biggest smartphone competitors is reportedly planning to release a laptop to... | Business Insider
- Kentucky clerk gets help from GOP state Senate president | Business Insider
- Ozuna, Prado help Marlins top Braves 8-3 in 3-game sweep | Business Insider
- Pope: Priests in Holy Year can absolve 'sin of abortion... | Business Insider
- Apple wants to make its own TV shows and movies, according to a new report (AAPL) | Business Insider