Our screen was looking for roughly 50% upside or more to the consensus analyst price target at Thomson Reuters.  We also screened out extreme small cap names and those which are too thin in volume.  We came up Alnylam Pharmaceuticals, Inc. (NASDAQ: ALNY), Dendreon Corporation (NASDAQ: DNDN), Geron Corporation (NASDAQ: GERN), Halozyme Therapeutics, Inc. (NASDAQ: HALO) and VIVUS Inc. (NASDAQ: VVUS).  There were actually enough in the $200 million to $1 billion range that we’ll probably have another list tomorrow.  Thomson Reuters has a consensus price target of $17.94 but a median price target of $15.00.  The analyst field is also very mixed here and the coverage looks a bit stale by our count.  The lower target still implies upside of more than 55%.

Alnylam Pharmaceuticals, Inc. (NASDAQ: ALNY) is fresh off news that it won a $10 milestone payment from Takeda in Japan on part of its gene silencing drug collaboration.  Alnylam transferred its RNA technology and it stands to win up to $1 billion ($140 million or so collected so far) if all milestones and targets get reached.  With shares at $9.65, its 52-week trading range is $8.79 to $17.59 and its market cap is almost $410 million.

Dendreon Corporation (NASDAQ: DNDN) was surprising to see on the list of implied upside targets despite its Provenge which has been approved for prostate cancer.  Shares are already up big from before its approval, but they are also considerably from highs.  The revenue stage has not yet gone into full tilt as production is being ramped up through 2011 and into 2012. At $36.17 its 52-week trading range is $25.78 to $57.67 and its market cap is about $5.2 billion.  Thomson Reuters has a consensus price target of $54.50, implying upside of just over 50%.  Bristol-Myers’ recent approval has helped this class of drugs which use the body’s immune system to fight cancer back in favor. Shares were around $33.00 on Friday versus $36.17 today.

Geron Corporation (NASDAQ: GERN) is the king of stem cells in America as far as the investor community is concerned.  Analysts have an average price target of $10.13 but the median target is actually $8.00.  At $4.98, this still represents about 60% implied upside to the lower target and more than 100% to an average target.  The 52-week range is $4.37 to $6.40 and its market cap is roughly $641 million.  Again, the analyst crowd is very far apart here on expectations.  Another risk to consider is that the company conducts secondary offerings on and off as it needs to raise cash to fund its expensive R&D pipeline.  This stock tends to pop around stem cell study news and presentation results being given at key conferences.

Halozyme Therapeutics, Inc. (NASDAQ: HALO) is about six-weeks past news that it and partner Roche announced the first patient received subcutaneous MabThera (rituximab) as an anticancer biologic in a Phase 3 registration trial using Enhanze technology.  This was the second Roche cancer medicine after Herceptin to enter a Phase 3 registration study as part of the Halozyme-Roche collaboration. The clinical trial also triggered a milestone payment of $5 million to Halozyme. At $6.76 its 52-week trading range is $5.79 to $9.11 and its market cap is $685 million.  Thomson Reuters has a consensus price target of $10.80, implying upside of about 60%.  We would note that the consensus price targets are rather far apart here and no major analyst calls have been seen in some time.

VIVUS Inc. (NASDAQ: VVUS) has one of the more promising obesity drug candidates.  At $6.36 its 52-week trading range is $4.69 to $13.68 and its market cap is about $520 million. Thomson Reuters has a consensus price target of $9.36, implying upside of more than 47%. Just be advised that this ‘more promising’ notes has severe caveats.  The FDA doesn’t seem to endorse anything related to obesity treatments due to side effects and safety profiles.  The reason there is so much implied upside is because there are those who are fighting over whether or not VIVUS will win full FDA approval.

Stay tuned for another screen of other biotech-related shares in BioHealth for Thursday as there are many others with large implied upside ahead.  As always, do your own due diligence when it comes to “Wall Street Research” and always understand what you are investing in.  Speculative biotech stocks aren’t exactly for widows and orphans.

JON C. OGG

Genzyme Corporation (NASDAQ: GENZ) is being acquired this Friday by Sanofi-Aventis (NYSE: SNY), and BlackRock is replacing Genzyme at the close of trading on Friday.  This move gives investors and index traders a mere three sessions to acquire the bulk of these BlackRock shares.

What was interesting is that the various BlackRock mutual funds and advisory accounts also held a massive stake in Bank of America.  At one point it was the largest BofA holder with some 5% or more.  Now BlackRock ranks third with a 2.59% stake in BofA in its various funds and advisory accounts.

There is another take to consider here.  Many index watchers expected that General Motors Corporation (NYSE: GM) would be the next of the big-cap stocks to join the S&P 500 Index.  BlackRock has long been on that list as well, but many may have expected that GM would get added first.  GM shares are actually up 0.3% at $31.20.

BlackRock shares are up 5.1% at $196.00 after a $186.50 close on Tuesday; its 52-week range is $138.42 to $221.78.

JON C. OGG

These new securities will not be a true IPO but the value of these will possibly fluctuate wildly around news compared to how Genzyme shares used to trade on their own.  Sanofi-Aventis has commenced its exchange offer for Genzyme shares for $74.00 cash and one CVR per share.

The CVRs give former Genzyme holders and new CVR buyers the right to receive additional cash payments if specified milestones related to Lemtrada are achieved over time or a milestone related to production volumes in 2011 for Cerezyme and Fabrazyme is achieved.

Upon closing of the exchange offer, the CVRs will be listed on the Nasdaq market under the ticker symbol “GCVRZ”.  These will trade in short order as the exchange offer to acquire Genzyme currently expires at 11:59 p.m., New York City time, on April 1, 2011.

Genzyme used to trade with tracking stocks before the company reacquired the entities.  Now Genzyme is being acquired by Sanofi-Aventis.  Determining the ultimate value of each CVR will be no easy task, but the value around NOON EST today would have been about $2.03 per CVR if you deduct $74.00 from $76.03.

The Genzyme acquisition is going to have some reallocation ramifications in biotech indexes and ETFs.  The Biotech HOLDRS (NYSE: BBH) have Genzyme as being 10.16% of its fund holdings. iShares Nasdaq Biotechnology (NASDAQ: IBB) has only a 3.24% weighting and First Trust NYSE Arca Biotechnology Index Fund (NYSE: FBT) has a 5.22% weighting for Genzyme.

Investors will still get to trade Genzyme via a new security, but these are not shares.  They are rights, and the ultimate value could be as mush as $14.00 per share through time if all hurdles are met or exceeded.

JON C. OGG

The reality is that the company may actually deserve a pat on the back rather than criticism. Sanofi sold 1-year, 2-year, and 3-year floating rate notes and fixed maturity notes due in 3-years, 5-years, and 10-years.

While we were not expecting the full $20+ billion to come straight from the Sanofi-Aventis cash coffers, this is still more debt assumption than we were expecting ahead of time.

It is possible that Sanofi-Aventis just realizes now that it is more than likely to have to pay up this milestone earn out (contingent value rights) that could get the total price closer to $80 per share based upon milestone achievements rather than just the $74 stated cash buyout price per share.

Perhaps another reason the debt sale was this large is that investors have a demand for non-government paper. We do not view the Sanofi-Aventis debt offering as anything that would send up red flags on its finances.  At the tight spreads it was able to borrow funds, it may even just be corporate prudence.  If you can borrow for an average of 3% and make somewhere around 20% return on capital then you would in theory be foolish not to borrow as much as they will give you.  Call it the “Biotech Carry Trade.”

If other drug giants can borrow billions of capital for this cheap, more large biotech giants might fall prey to M&A predators.

JON C. OGG

Advanced Micro Devices, Inc. (NYSE: AMD) Reiterated Buy and $12 price target at Gleacher & Co.
Brookfield Asset Management Inc. (NYSE: BAM) Started as Outperform with $38 target at Credit Suisse.
Genzyme Corporation (NASDAQ: GENZ) Cut to Hold at Jefferies.
Kinross Gold Corporation (NYSE: KGC) Cut to Hold at TD.
NetApp, Inc. (NASDAQ: NTAP) Cut to Hold at Canaccord Genuity; Cut to Neutral at Piper Jaffray; Cut to Hold at Citigroup.
NVIDIA Corporation (NASDAQ: NVDA) Cut to Hold at Citigroup.
Orbitz Worldwide, Inc. (NYSE: OWW) Cut to Underweight at Piper Jaffray.
Pan American Silver Corp. (NASDAQ: PAAS) Cut to Hold at TD.
Sara Lee Corporation (NYSE: SLE) Cut to Underperform as Bear of the Day at Zacks.
Shutterfly, Inc. (NASDAQ: SFLY) Cut to Neutral at Zacks.
Stanley Black & Decker, Inc. (NYSE: SWK) Raised to Outperform as Bull of the Day at Zacks.
Starwood Hotels & Resorts Worldwide Inc. (NYSE: HOT) Reiterated Buy and raised target to $74 at Argus.

You can join our free daily email distribution list to hear more about analyst upgrades and downgrades, top day trader and active trader alerts, dividend trends, news on Buffett and other investment gurus, IPOs, secondary offerings, private equity, and more.

JON C. OGG

Here is what traders and investors need to know about and care about.  There was a huge amount of concern that Henri Termeer would manage to drive Sanofi-Aventis away.  So arbitrage spreaders and investors who were sitting on great gains were buying PUTS to protect the position.  The open interest for the FEB-2011 was almost 190,000 contracts in the available PUTS alone.  The open interest in the CALLS was for FEB-2011 was about 100,000 contracts. On Monday, that open interest was reaching a record.

The MARCH-2011 CALLS had a larger open interest than the PUTS due to the time value and betting patterns of investors when it comes to M&A investing.  This might not matter as much as it would have if the merger would have hit a terminal snag, but it is what traders and investors need to know now.

If you want to know which other biotech outfits may be acquisition targets, we created a list of about 15 potential biotech M&A targets for BioHealthInvestor.com at the end of January.  Nothing has changed as far as that list is concerned.

JON C. OGG

Starbucks (NYSE: SBUX) and Green Mountain are close to a strategic partnership (Reuters)

A court in Ecuador ordered Chevron (NYSE: CVX) to pay $8.6 billion in environmental damage. (Reuters)

China’s inflation slowed recently (Reuters)

The Bank of Japan held rates steady but signaled the economy was improving (Reuters)

Research In Motion (NASDAQ: RIMM) will offer its Playbook with 4G capacity (Reuters)

Investors are nervous about Dell’s (NASDAQ: DELL) margins ahead of its earnings (Reuters)

Sanofit-Aventis and Genzyme (NASDAQ: GENZ) are still battling over a takeover price (Reuters)

Public pension funds largely ignored what banks charged for currency trades (WSJ)

Fewer private equity firms use hostile bids when trying to takeover public companies (WSJ)

Wall St firms did not make large profits on commodities because they missed signs that prices would rise (WSJ)

Marriott will rid itself of its time-share business (WSJ)

Fedex (NYSE: FDX) cut its earnings forecasts due to poor weather and rising fuel prices (WSJ)

GE (NYSE: GM) released its plans for employee profit-sharing (WSJ)

Growth of the German economy remained strong (WSJ)

GM (NYSE: GM) will release a new line-up of cars in China (WSJ)

The use of web-video rose in large part due to the increase in demand for Netflix (NASDAQ: NFLX) streaming video (WSJ)

LG said its handset sales would rise as global smartphone sales expand (WSJ)

Cities are raising taxes to offset lower budget contributions from states (WSJ)

The Obama budget would keep deficit spending at high levels for many years (WSJ)

The IMF said Asia would need to fight inflation with currency adjustments that would allow more flexibility in price (WSJ)

The EU will probably increase the size of its bailout fund (WSJ)

The rise of Facebook is damaging its relationship with companies like Google (NASDAQ: GOOG) (WSJ)

Huawei will need to sell assets of an American firm it bought recently a government panel said (WSJ)

The Archives of Internal Medicine said that many medical devices which have been recalled did not get initial proper screening (WSJ)

Barnes & Noble (NYSE: BKS) has tried to take advantage of Amazon.com’s (NASDAQ: AMZN) disputes with states over income taxes by soliciting Amazon’s partners to move to the book firm’s website (WSJ)

There is a shortage of vegetables in the US because of cold weather in Mexico (WSJ)

Yahoo! (NASDAQ: YHOO) is strengthening its relationship with Facebook as its own social media plans falter (WSJ)

Silicon Valley Network and the Silicon Valley Community Foundation found that the pay has not improved in the region (WSJ)

Investors Bruce R. Berkowitz and Charles M. Fernandez resigned from the board of St. Joe less than two months after joining (WSJ)

Large companies have begun to raise prices as commodities prices rise (NYT)

More airlines cancel flights well ahead of bad weather (NYT)

The Obama budget aims to reform corporate taxes and reduce loop holes (FT)

GE (NYSE: GE) will try to sell its container leasing program (FT)

The SEC wants states and municipalities to disclose more about potential trouble  (FT)

PIMCO has cut its holdings of US paper (FT)

China inflation rose sharply when food prices were eliminated (Bloomberg)

Lending in China rose which increased concerns about inflation (Bloomberg)

Douglas A. McIntyre

The Obama budget will cut $1.1 trillion in costs over 10 years. (Reuters)

NY Senator Schumer raised objections to the merger of the NYSE (NYSE: NYX) and the Deutsche Borse. (Reuters)

China’s trade surplus dropped to $6.5 billion in January on strong imports. (Reuters)

Sanofi-Aventis has completed it due diligence of Genzyme. (NASDAQ GENZ) (Reuters)

Smartphone makers marketed themselves to developers at the Mobile World Congress. (Reuters)

The head of Nokia (NYSE: NOK) said his company’s venture with Microsoft (NASDAQ: MSFT) would bring the handset company billions of dollars. (Reuters)

Zynga may raise money at a $7 billion valuation. (Reuters)

Linux may be helped in its relationship with smaller cellphone companies now that the Microsoft deal with Nokia is set. (Reuters)

Harsh regulations may keep Asian exchanges from mergers. (Reuters)

GE (NYSE: GE) will buy John Wood for $2.8 billion. (Reuters)

China moved ahead of Japan as the world’s second largest economy. (WSJ)

Consumer and business spending should rise this year. (WSJ)

The Obama budget should raise the deficit to $1.6 trillion as tax cuts hurt government revenue. (WSJ)

JPMorgan (NYSE: JPM) will start a fund to invest in new media. (WSJ)

A recovery of the world economy may allow G20 nations to avoid addressing some of the things that cause the recession. (WSJ)

The Chapter 11 filing of Borders will help e-book sales. (WSJ)

Chesapeake Energy is under pressure from Carl Icahn to sell assets. (WSJ)

The end of a law that helps support American workers pressed out of work by trade will pressure US relation with Korea and Columbia. (WSJ)

Public workers unions have prepared for state budget cuts. (WSJ)

Vietnam devalued it currency by 8.5%. (WSJ)

Apple (NASDAQ: AAPL) will launch a less expensive iPhone. (WSJ)

The 2011 proxy season will bring pressure from shareholders to open up board decisions. (WSJ)

Rising cost of goods sold caused by inflation will hurt margins of US firms more that Wall St. expects. (WSJ)

The European Central Bank will struggle with the economic problems of rapid growth in Germany, modest growth in France and slow growth in Spain. (WSJ)

China is rapidly expanding its participation in the North American natural gas market. (WSJ)

Netbook sales have been overtaken by tablet PCs but still do well in Asia and Latin America. (NYT)

Competition has hurt Groupon sales in Japan. (NYT)

China may build a rail system through Columbia to compete with the Panama Canal. (FT)

The US will try to get sovereign funds to put money into the AIG (NYSE: AIG) IPO. (FT)

Europe’s drop in spending on solar technology may help China. (Bloomberg)

Douglas A. McIntyre

AOL Inc. (NYSE: AOL) is paying $315 million to acquire privately-held Huffington Post to revamp its online content.

Beckman Coulter Inc. (NYSE: BEC) is being acquired by Danaher Corp. (NYSE: DHR) for $5.87 billion.  The deal comes to $83.50 per share and the $5.87 billion compares to a market cap of roughly $31.5 billion for Danaher.  Danaher investors better hope that synergies and cost efficiencies can be had in a serious way because this was about $10.00 above what we thought was a fair market value in December when the rumors first broke.

Berkshire Hathaway Inc. (NYSE: BRK-A) (NYSE: BRK-B) is finally making good on an event that first surfaced last August.  Warren Buffett and friends are acquiring the rest of Wesco Financial Corporation (NYSE Amex: WSC), the remaining 19.9% not owned, for cash or shares of Berkshire Hathaway Class B common stock at the election of each shareholder for almost $550 million with a starting value before gains and items of $386.55 per share.

Ensco Plc (NYSE: ESV) is acquiring Pride International (NYSE: PDE) in a cash and stock deal valued at $41.60 prior to any dilution or share value change.  The deal is for 0.4778 shares and $15.60 in cash.

Sanofi-Aventis (NYSE: SNY) is reportedly close to striking a deal to acquire Genzyme Corporation (NASDAQ: GENZ) for some $74 to $77 per share plus what will be up to a $5 to $6 earn-out right per share based upon certain milestones.

In a much smaller deal, GigOptix, Inc. (OTCBB: GGOX) is acquiring Endwave Corporation (NASDAQ: ENWV) in a stock for stock deal that appears to be close to a merger of equals.  Endwave shareholders will own some 42.5% of the combined company.

You can join our free daily email distribution list to hear more about analyst upgrades and downgrades, top day trader and active trader alerts, dividend trends, news on Buffett and other investment gurus, IPOs, secondary offerings, private equity, and more.

JON C. OGG

Sanofi-Aventis and Genzyme (NASDAQ: GENZ) are closer to a deal (Reuters)

Hackers who broke into the NASDAQ will undermine investor confidence. (Reuters)

A strong yen and the US market will make (Reuters)

Oil rose again on trouble in Egypt (Reuters)

The CEO of Google (NASDAQ: GOOG) wants to avoid a long fight with European regulators over antitrust issues (Reuters)

Verizon Wireless ran out of Apple (NASDAQ: AAPL) iPhones after a day (Reuters)

BP in (NASDAQ: BP) wants to buy a stack in Reliance gas (Reuters)

The Nokia (NYSE: NOK) CEO is likely to shake up top management (WSJ)

The EPA is the largest federal agency being targeted by businesses (WSJ)

Many banks still carry risky assets on their balance sheets (WSJ)

Bond market trading shows a concern about inflation (WSJ)

Strong fourth quarter earnings have not helped job additions (WSJ)

China is building a strategic stockpile of rare earth metals (WSJ)

Yahoo! (NASDAQ: YHOO) is at work at personalizing more  mobile content (WSJ)

Sony Ericsson launched a new high end smartphone (WSJ)

Governors are cutting cutting budgets across the nation (WSJ)

GM (NASDAQ: GM) is upping its marketing for hybrid cars (WSJ)

Ford (NYSE: F) will increase production by 13% in the first quarter (WSJ)

The Conference Board says that is some industries that there is a labor shortage in some fields (WSJ)

Companies are in a fight with proxy firms about high executive pay (WSJ)

Strong growth could increase business “complancity” (WSJ)

Investors are more comfortable with high risk to get better yields (WSJ)

The amount of planted in the US is likely to rise sharply according to the The National Cotton Council of America (WSJ)

The head of Ebay (NASDAQ: EBAY) says the company’s period of rapid growth is not over (NYT)

The FCC will target under served areas with broadband (NYT)

The value of cooper continues to rise on beliefs that global businesses will continue to prosper (FT)

Goldman Sacks (NYSE: GS) will spend a great deal of cash on distressed assets (FT)

Fiat was hit hard by the Italian government over potential plans to move its headquarters to Detroit (FT)

A rising euro may buy Germany time to work out a potential deal to create an EU-wide solution to regional debt (Bloomberg)

Investors have risked over $100 billion on the bet that metals prices will rise (Bloomberg)

Russia will use reserve ratios to cut inflation (Bloomberg)

Douglas A. McIntyre