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
- Measuring How Much Poorly Thought Out Regulation Hurts The US Consumer? | ZeroHedge
- Is This The Chart That Has High-Yield Investors Running For The Hills? | ZeroHedge
- Daily Scorecard | iBankCoin.com
- World Oil Production – Where Are We Headed? | Financial Sense
- All About That Small Cap Life | iBankCoin.com
- Gary Shilling: "Q2 GDP Was Closer To 1% Than To 3%. It Could Even Be A Negative Number" | ZeroHedge
- China Cements Eurasian Trade Routes With Great Silk Road Revival: The Infographic | ZeroHedge
The most relevant financial news and articles from the Internets
- We Just Got More Good News About The 'Biggest Fiscal Development... | Business Insider
- How Dwayne 'The Rock' Johnson Went From WWE Wrestler To Hollywood's Box Office... | Business Insider
- 10 Things In Tech You Need To Know This Morning (AAPL) | Business Insider
- EL POLLO LOCO CLOSES UP 43% (LOCO, CMG) | Business Insider
- Dems Say Paul Ryan's Poverty Plan Is 'Not Fooling Anyone... | Business Insider
- This Is What It Is Like To Race $10,000 Lawn Mowers In Texas [PHOTOS... | Business Insider
- Here's Why Medicare Isn't Actually Going To 'Run Out Of Money... | Business Insider