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
- Goldman Warns, Congress Is Preparing To Tame The Fed | ZeroHedge
- U.S. Plays With Fire By Using Bank Sanctions as Political Tools | Financial Sense
- Five Stocks for a Special Occasion | iBankCoin.com
- New Research Strengthens Link Between Shale Drilling and Earthquakes | Financial Sense
- $22 Billion in California Homes Sold to Chinese All-Cash Buyers | Financial Sense
- The Skills Mismatch Remains a Fixture in U.S. Labor Markets | Financial Sense
- Advice from The Dude About Any Losing Trades You Have Had | iBankCoin.com
The most relevant financial news and articles from the Internets
- Here's What Happens When You Try To Talk To The CEO Of CYNK | Business Insider
- Why MGIC Investment Stock Is Plunging This Morning | TheStreet.com
- Digital Advertising Intern Wanted - Join Our Growing Team | Business Insider
- Great Deal! AbbVie Will Buy Shire and Investors Will Be Rewarded | TheStreet.com
- Here's Even More Evidence That Apple Plans To Use A Nearly Indestructible Sapphire... | Business Insider
- These New Apps Make Profits From Information That's Otherwise Free... | Business Insider
- Notable Mergers and Acquisitions of the... | StreetInsider.com