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Investors Seeking Defensive Stocks Where 3% to Over 5% Dividends Rule!

Administrator — Mon, 14 May 2012 17:14:54 +0000

A stock market that sells off eight of nine days is not a good market. Even the Facebook IPO is being viewed as a one-off item rather than a systemic item which will make the market stronger. With “Sell in May and go away!” remaining prevalent and with Europe in meltdown as Asia slows, the big question is where to hide. Some investors just refuse to accept the floor-level rates of CDs and Treasury bills and Treasury notes, so they go hide out in the defensive stocks like tobacco, consumer staples, basic level food, utilities, big-pharma, and maybe even those high-yields in telecom. This is a market where defensive stocks should rule the roost.

People are going to buy Coke and Pepsi, most likely, in almost any economy. Pepsico, Inc. (NYSE: PEP) is actually up 0.6% at $67.23 against a 52-week high of $71.89; Coca-Cola Company (NYSE: KO) is down 0.6% at $76.95 against a 52-week high of $77.82. With yields of about 3% on average, these pay about the same as the 30-Year Treasury’s long-bond. The beer segment remains uncorrelated to defensive stocks as it did last week (in part due to currencies): Anheuser-Busch InBev SA (NYSE: BUD) is down by 0.7% at $71.43 and Molson Coors Brewing Company (NYSE: TAP) is down 1.2% at $40.81. Even the best water utility in America via American Water Works Company, Inc. (NYSE: AWK) is down another 1% $33.99 against a 52-week and all-time high of $34.89.

Food is supposed to be defensive. You gotta eat, right? McDonald’s Corporation (NYSE: MCD) is down almost 0.4% at $91.55 and getting further and further away from that $102.22 all-time high recently seen. The rest of the defensive food segment is up to mixed as food is defensive and with dividends:

Kraft Foods Inc. (NYSE: KFT) is up 0.4% at $39.20 with a 3% yield that challenges the long-bond;
ConAgra Foods, Inc. (NYSE: CAG) is down 0.2% at $25.67 with a 3.7% yield that beats the long-bond;
Campbell Soup Co. (NYSE: CPB) is up 0.25% at $34.49 with a 3.4% yield that beats the long-bond;
Hormel Foods Corporation (NYSE: HRL) is down only 0.1% at $29.08 but its 2.1% yield is ‘only’ paying what the 10-year has been paying recently.

Smoking has those nice 5%-plus yields for the defensive tobacco sector: Altria Group Inc. (NYSE: MO) is down only 0.1% at $31.75 against a 52-week high of $32.62; Vector Group Ltd. (NYSE: VGR) is down 0.5% at $16.73; and Reynolds American Inc. (NYSE: RAI) is down only 0.2% at $40.41 against a high of $42.81.

Diapers, toothpaste, deodorant, and shaving… consumer products are acting defensive: Procter & Gamble Co. (NYSE: PG) is down only 0.3% at $63.50 with a 3.5% yield; Kimberly-Clark Corporation (NYSE: KMB) is up by 0.3% at $79.62 with a 3.7% yield; Colgate-Palmolive Co. (NYSE: CL) is down 0.1% at $99.20 but it only pays about 2.5% for a dividend yield.

Drug and medical is mixed to positive: Merck & Co. Inc. (NYSE: MRK) is up by over 0.8% at $38.35 with its 4.4% yield; Pfizer Inc. (NYSE: PFE) is down only $0.01 at $22.64 with its 3.9% yield; and Johnson & Johnson (NYSE: JNJ) is down 0.5% at $64.00 with its 3.8% yield.

Those smartphones and telephones are not acting defensive at all today with Verizon Communications Inc. (NYSE: VZ) down 0.9% at $40.80 with its 5% yield and with AT&T, Inc. (NYSE: T) down 0.7% at $33.36 with a 5.4% yield.

Some investors are willing to suffer from the near-zero return of Treasuries, while others are going to try to look for the safest of stocks to seek safe and steady dividends. The DJIA is down 0.7% and the S&P 500 was down 0.6% at last look. Both are actually much better than what we were looking at just two hours or so ago.

JON C. OGG

Filed under: Defensive Stocks, Dividend Tagged: AWK, BUD, CAG, CL, CPB, HRL, JNJ, KFT, KMB, KO, MCD, MO, MRK, PEP, PFE, PG, RAI, T, TAP, VGR, VZ

The Market Where Defensive Shares Are Working Again (PEP, KO, BUD, TAP, AWK, MCD, KFT, CAG, CPB, HRL, MO, VGR, RAI, PG, KMB, CL, MRK, PFE, JNJ, T, VZ)

Administrator — Tue, 08 May 2012 16:07:03 +0000

Blame whatever you want. A weaker U.S. economy, a weakening and flailing Europe, a move to socialism in France and Greece, a weaker BRIC and emerging market story, commodity prices and on and on… Commodity prices and their tracking shares are getting hosed today. Why does the “Sell in May and go away!” profile often coincide with sell-offs so well?

After the weakness in the broad market has the DJIA down 140 points (or -1.1%) and the S&P 500 Index down 15 points or 1.1%, it turns out that most of the defensive stock sector leaders are holding up far better than the broad market in our go-to defensive stock portfolio. We have taken a look at each of these with share price snapshots right before Noon EST.

No matter what, you gotta drink! Pepsico, Inc. (NYSE: PEP) is down 0.5% at $66.28 against a 52-week high of $71.89; Coca-Cola Company (NYSE: KO) is down 0.4% at $76.97 against a 52-week high of $77.82. With yields of about 3% on average, these are now challenging the 30-Year Treasury yields. The beer segment is not acting defensive as it should, perhaps because they are foreign issues now with more currency risks: Anheuser-Busch InBev SA (NYSE: BUD) and Molson Coors Brewing Company (NYSE: TAP) are not acting very defensive with price corrections of 3% and 2$ respectively.

Perhaps the most defensive you can get is water, and the top water utility is American Water Works Company, Inc. (NYSE: AWK) with a premium valuation. This water leader is down 0.8% at $33.73 against a 52-week and all-time high of $34.89.

Food is supposed to be defensive, although a drop of 1.5% in McDonald’s Corporation (NYSE: MCD) to $94.10 is causing some added stress in what was the darling of the DJIA in 2011. The rest of the defensive food segment seems to be less damaged when you evaluate the moves: Kraft Foods Inc. (NYSE: KFT) is down only 0.4% at $39.11; ConAgra Foods, Inc. (NYSE: CAG) is down 0.7% at $25.52; Campbell Soup Co. (NYSE: CPB) is down only 0.3% at $33.97; and Hormel Foods Corporation (NYSE: HRL) is down only 1 penny at $28.92 as the world is getting excited about Spam again.

Smoking is defensive again and the tobacco stocks are holding up much better than the broad market with those 5% and higher dividends: Altria Group Inc. (NYSE: MO) is down only $0.3% at $32.10 against a 52-week high of $32.62; Vector Group Ltd. (NYSE: VGR) is down only 0.2% at $16.88; and Reynolds American Inc. (NYSE: RAI) is down only 0.2% at $40.18 against a high of $42.81.

Shaving, diapers, toilet paper, and other consumer products are acting defensive with some gains on a weak day. Procter & Gamble Co. (NYSE: PG) is trading up $0.11 at $64.36 and Kimberly-Clark Corporation (NYSE: KMB) is up $0.08 at $79.08 with KMB challenging the 52-week high. Colgate-Palmolive Co. (NYSE: CL) is down ‘only’ 0.5% at $99.10 against a 52-week high of $100.81.

Drug and medical is holding up on the consumer end with losses look far less than the broader market: Merck & Co. Inc. (NYSE: MRK) is down 0.35% at $38.40; Pfizer Inc. (NYSE: PFE) is down 0.3% at $22.38; and Johnson & Johnson (NYSE: JNJ) is down the least with a drop of 0.2% at $64.65 against a 52-week high of $68.05.

Those smartphones and telephones are somewhat defensive, and those 5%-plus yields sure shield investors who are worried about chasing the hottest growth stocks. Verizon Communications Inc. (NYSE: VZ) is down only 1-penny at $40.52 with a 5% dividend yield and AT&T, Inc. (NYSE: T) is actually up 0.2% at $33.08 with a yield of about 5.4%.

When investors want safety and when the Treasury yield is so low on the longer-term Treasury market, many investors turn to the safety of the higher dividends and safer stocks that are defensive. Greece and the rest of PIIGS may fall again, but the logic is that U.S. consumers still have to eat, drink, shave, put on deodorant, and tend to stick with their core vices as best as they can.

JON C. OGG

Filed under: Consumer Goods, Defensive Stocks, Dividend, Drug companies, Food, Telecom, Tobacco Tagged: AWK, BUD, CAG, CL, CPB, HRL, JNJ, KFT, KMB, KO, MCD, MO, MRK, PEP, PFE, PG, RAI, T, TAP, VGR, VZ

24/7 Wall St. Closing Bell (PM, SNDK, BIDU, AMZN, ALU, ELY, CLWR, DECK, WY, TRP, GT, PG, NWL, MRK, HELE, F, COV, CVX, MDRX, EXPE, WDC)

Paul Ausick — Fri, 27 Apr 2012 20:05:47 +0000

Markets opened higher this morning following a lower-than-expected GDP growth estimate of 2.2%. That was weaker, but not awful (our coverage here). The consumer sentiment survey rose a couple of ticks in April, but Americans still believe the future will better than the present (our coverage here). The US dollar index fell today, now down -0.25% at 78.725. The GSCI commodity index is up 0.07% at 682.08, with commodities mostly higher on the slightly weaker dollar. WTI crude oil closed up 0.4% at $104.93/barrel, and Brent crude trades down -0.23% at $119.64/barrel. Gold settled up 0.3% today, at $1,664.80/ounce.

The unofficial closing bells put the DJIA up nearly 24 points to 13,228.24 (0.18%), the NASDAQ rose nearly 19 points (0.61%) to 3,069.20, and the S&P 500 rose 0.24% or more than 3 points to 1,403.37.

There were several analyst upgrades and downgrades today, including Philip Morris International Inc. (NYSE: PM) reiterated as ‘buy’ and target price raised to $94 at Argus; SanDisk Corp. (NASDAQ: SNDK) raised to ‘buy’ at Jefferies; Baidu Inc. (NASDAQ: BIDU) maintained as ‘neutral’ but target price cut at Credit Suisse; Amazon.com Inc. (NASDAQ: AMZN) raised to ‘buy’ at BofA/ML, Nomura, and Goldman Sachs; and Alcatel-Lucent SA (NYSE: ALU) maintained as ‘underperform’ and estimates cut at Jefferies.

Earnings reports since markets closed last night have led to some price changes as of the last half hour of trading today: Amazon.com is up 15.6% at $226.64; Callaway Golf Co. (NYSE: ELY) is down -14.9% at $5.94 (our coverage here); Clearwire Corp. (NASDAQ: CLWR) is down -2.7% at $1.43; Deckers Outdoor Corp. (NASDAQ: DECK) is down -25.5% at $51.78 after posting a new 52-week low of $51.03 (our coverage here); Weyerhaeuser Corp. (NYSE: WY) is down -0.3% at $20.81 (more coverage here); TransCanada Corp. (NYSE: TRP) is up 0.5% at $44.01; The Goodyear Tire & Rubber Co. (NYSE: GT) is down -5.1% at $11.32; Procter & Gamble Co. (NYSE: PG) is down -4% at $64.18 (our coverage here); Newell Rubbermaid Inc. (NYSE: NWL) is up 3.6% at $18.61; Merck & Co. (NYSE: MRK) is down -0.2% at $38.38; Helen of Troy Ltd. (NASDAQ: HELE) is up 4.4% at $35.33; Ford Motor Co. (NYSE: F) is down -2.1% at $11.62 (our coverage here); and Covidien plc (NYSE: COV) is up 0.5% at $55.32.

Be sure to look at our list of next week’s big earnings.

Other standouts from today include the following stocks:

Chevron Corp. (NYSE: CVX) is up 0.2% at $106.44. The supermajor oil company reported earnings in line, but production was down. More coverage here.

Allscripts Healthcare Solutions Inc. (NASDAQ: MDRX) is down -36% at $10.25 after posting a new 52-week low of $9.00. The healthcare services provider fired its chairman, and the list of woes goes on. More coverage here.

Expedia Inc. (NASDAQ: EXPE) is up 24.4% at $40.59. The Internet travel company posted better-than-expected quarterly results. More coverage here.

Western Digital Corp. (NYSE: WDC) is down -14.2% at $37.83. The disk drive maker had solid earnings, but worries abound about next quarter. More coverage here.

Stay tuned for Monday. We have noted the following events on the schedule (all times Eastern):

8:30 a.m. – Personal income and spending
9:45 a.m. – Chicago PMI
10:30 a.m. – Dallas Fed manufacturing survey
11:30 a.m. – 3- and 6-month bill auctions
3:00 p.m. – Farm Prices

Have a great weekend!

Paul Ausick

Filed under: HI/LOW, Market Close Tagged: ALU, AMZN, BIDU, CLWR, COV, CVX, DECK, ELY, EXPE, F, GT, HELE, MDRX, MRK, NWL, PG, PM, SNDK, TRP, WDC, WY

One Big Disbelief of an Amylin Buyout… Worth Only $12 Per Share? (AMLN, BMY, MRK, AZN, SNY, PFE, NVO)

Administrator — Fri, 27 Apr 2012 13:15:28 +0000

Amylin Pharmaceuticals, Inc. (NASDAQ: AMLN) is supposed to be acquired by a larger drug company. It is one of the biggest public merger rumors out there. At least that is the belief of Wall Street. Canaccord Genuity is out with a report which may minimize this effort or at least may take out some of the fervent beliefs that this company is all but already sold.

Canaccord’s Salveen Richter has maintained a SELL rating with a price target down at $12.00 per share. This is important because Amylin closed at $25.73 and the 52-week trading range is $8.03 to $26.87. The report is based in part on the notion that Bydureon sales are off to a slow start that was disclosed in the company’s earnings report yesterday. The report was called a weak earnings report with Bydureon revenue of only $6.9 million versus $10.4 million expected.

The report may be very much of a standout because some of the companies which have been named as likely and/or potential bidders are Bristol-Myers Squibb Company (NYSE: BMY), Merck & Co. Inc. (NYSE: MRK), AstraZeneca PLC (NYSE: AZN), Sanofi (NYSE: SNY), and Takeda. We have also wondered perhaps whether or not Pfizer Inc. (NYSE: PFE) or Novo Nordisk A/S (NYSE: NVO) could be among the possible buyers, but these two seem to be dismissed elsewhere as likely buyers.

The report does caution about a floor from the buyout speculation: “That said, continued speculation on the company’s takeout potential will likely set a floor on Amylin shares at current levels, barring a potential E.U. partnership.” Other notes as follows: Bydureon captured 5.9% of the GLP–1 market… Bydureon is being impacted by competition, healthcare reform and reimbursement/access… AMLN Q1/12 total revenue of $153.7 million was under consensus of $162.1 million… it is lowering FY12 Bydureon revenue estimate to $133.9 million from $209.5 million… firm is increasing its non-GAAP SG&A expense to $395.5 million from $356.3 million… firm is lowering FY12 GAAP EPS estimate to -$1.68 EPS from -$1.09 EPS.

Canaccord Genuity’s valuation puts its 12-month price target at $12.00 and it is based upon 20-times the firm’s fully taxed and fully diluted GAAP earnings estimate for 2016 of $1.55 EPS that is then discounted back to 2012 at a rate of 28%.

What is interesting is that the Thomson Reuters consensus target is only $18.10, so there is quite a takeover premium built into the stock. Amylin may get acquired or it may not. This is a bold call considering that the company even recently announced that Carl Icahn voluntarily dismissed his suit against the company. It would seem that Carl Icahn believes that a premium buyout is headed Amylin’s way.

JON C. OGG

Filed under: Analyst Calls, Biotech, Drug companies, Healthcare, Mergers and Buy Outs, Pharmaceuticals, Rumors Tagged: AMLN, AZN, BMY, MRK, NVO, PFE, SNY

J&J Joins Dividend Hike One-Up Game (JNJ, PFE, MRK)

Administrator — Thu, 26 Apr 2012 15:13:15 +0000

How many DJIA components can raise their dividend in one week? Johnson & Johnson (NYSE: JNJ) answered that question as “Who knows, but we can make it one more!” J&J has joined the parade of DJIA components this week that raised the dividends.

Just this week we saw a Dow Jones report calling for DJIA components to boost their dividends by about 8% on average in 2012, and J&J is announcing a hike of 7% to its quarterly payout. J&J was one of the predicted dividend hikes in that report. The prior quarterly dividend of $0.57 per share is rising up to $0.61 per share per quarter.

The company is talking up its 2011 results, its strong financial position, and confidence in the future. It is the 50th consecutive year that it has raised the payout. With a $64.70 share price, the new dividend yield comes to almost 3.8% if you round higher (from 3.77%).

Today’s dividend hike makes no mention of J&J’s quality control issues and product recalls that it is still working through. The company issued a separate release noting that Alex Gorsky is formally taking over as CEO and that Bill Weldon will remain in place as a non-executive Chairman of the board of directors.

Gorsky’s ”outline for the future” has a lot of good buzzwords in there… adapt faster than ever… be more agile than ever… new thinking… more cost-efficient ways of delivering health care… an expanded global presence and mindset… working smarter and harder.

Both Pfizer Inc. (NYSE: PFE) and Merck & Co. (NYSE: MRK) have raised their dividend in recent quarters for the first time in years. J&J’s 3.8% indication compares to dividend yields of 3.9% for Pfizer and 4.4% for Merck & Co. That may lag in yield and the company may still be working through some issues, but 50 straight years of dividends hikes is rather impressive even if the yield lags.

JON C. OGG

Filed under: Dividend, Drug companies, Medical, Pharmaceuticals, Shareholder Issues Tagged: JNJ, MRK, PFE

What’s A Better Buyout: Ardea or Amylin? (RDEA, AMLN, AZN, BMY, MRK)

Administrator — Mon, 23 Apr 2012 18:54:33 +0000

Ardea Biosciences, Inc. (NASDAQ: RDEA) is soaring today on news that AstraZeneca PLC (NYSE: AZN) is paying about $1.26 billion to acquire the company. With another small-cap to mid-cap biotech and emerging pharma company being gobbled up by Big Pharma, and with Amylin Pharmaceuticals, Inc. (NASDAQ: AMLN) up over 10% on more talk of a possible sale, we want to ask one simple yet complex question: Is Ardea a better acquisition that Amylin Pharmaceuticals, Inc. (NASDAQ: AMLN)?

Ardea Biosciences, Inc. (NASDAQ: RDEA) is now worth about $1.2 billion and the stock’s prior 52-week high had been $29.06. Now shares are up at $31.58 and AstraZeneca buys a gout and cancer pipeline here. The problem is that no one is expecting big earnings nor even big sales any time soon. Thomson Reuters has estimates of -$3.64 EPS on only $13.4 million in revenue in 2012 and -$1.89 EPS on almost $56 million in 2013. Ardea has just over 100 employees and its pipeline includes two gout treatments and two cancer treatments (one for pancreatic cancer and one for primary liver cancer.

Amylin Pharmaceuticals, Inc. (NASDAQ: AMLN) now has a $3.8 billion market capitalization rate. With a fresh new diabetes drug approval and with prior speculation of a super-premium buyout, this one already has a lot of premium built in. Shares went from about $11 to more than $17 early in 2012 and then from about $16 to over $24 over the last month before settling down around $23 of late. Now there is talk that it has several interested bidders. Amylin’s ongoing pipeline is concentrated around diabetes and obesity but its main products are BYDUREON and BYETTA. Amylin is also expected to lose money in 2012 and in 2013, but its sales were $650 million in 2011 and are expected to rise to $688.4 million in 2012 and $852.9 million in 2013.

Bristol-Myers Squibb Company (NYSE: BMY) reportedly made a bid for Amylin already, and newer reports have Merck & Co. Inc. (NYSE: MRK), AstraZeneca PLC (NYSE: AZN), and Takeda all lined up as would-be potential acquirers.

It is very difficult to get an apples to apples comparison here when you consider that one company is in the development and clinical stage and the other is already in the product commercialization stage. Ardea is of course a much larger unknown that Amylin. Its price and market capitalization also reflect this.

JON C. OGG

Filed under: Biotech, Drug companies, Healthcare, Mergers and Buy Outs, Pharmaceuticals, Rumors Tagged: AMLN, AZN, BMY, MRK, RDEA

Amylin Seeks a Buyer (AMLN, CS, GS, BMY, SNY, LLY, AZN, MRK)

Paul Ausick — Mon, 23 Apr 2012 11:59:20 +0000

Diabetes drug maker Amylin Pharmaceuticals Inc. (NASDAQ: AMLN) has hired bankers and lawyers to help the company find a buyer. In February Amylin turned down a $3.5 billion ($22/share) offer from Bristol-Meyers Squibb Co. (NYSE: BMY), and the company’s third-largest shareholder, Carl Icahn, has demanded that the company put itself up for sale and the right to nominate his own directors. Amylin has hired Credit Suisse (NYSE: CS) and Goldman Sachs Group Inc. (NYSE: GS) as financial advisers.

One potential buyer is Sanofi (NYSE: SNY), the Paris-based drug company that is developing a similar treatment for diabetes. Amylin ended a long relationship with Eli Lilly & Co. (NYSE: LLY) last November, but still owes Lilly payments of $1.2 billion over the next several years. AstraZeneca plc (NYSE: AZN) is another drug maker believed to be on the look-out for an acquisition as is Merck & Co. Inc. (NYSE: MRK).

Amylin’s diabetes drugs Byetta and Bydureon are both approved for use in the US. Byetta is a twice-weekly injection for Type 2 diabetes, while Bydureon, which was approved only in January, is a once-a-week injection for the disease. Diabetes affects some 300 million people worldwide and 26 million in the US alone. Drugs to combat the disease could be enormous sellers.

The market is very happy with the news from Amylin. Shares are up more than 10% in the pre-market this morning, at $25.15 in a 52-week range of $8.03.25.84.

Paul Ausick

Filed under: Drug companies, Mergers and Buy Outs, Pharmaceuticals Tagged: AMLN, AZN, BMY, CS, GS, LLY, MRK, SNY

Media Digest (4/16/2012) Reuters, WSJ, NYT, FT

247wallst — Mon, 16 Apr 2012 10:34:00 +0000

Concerns about Spain and Italy renew capital markets’ rejection of area debt. (Reuters)

Best Buy (NYSE: BBY) will have to bring in an outsider to change the company’s old philosophy. (Reuters)

The Treasury lauds China’s plan to widen the yuan’s trading range. (Reuters)

Sergey Brin of Google (NASDAQ: GOOG) says the openness of the Internet is under pressure. (Reuters)

Carlyle will try to raise $763 million from its IPO. (Reuters)

The case between Oracle (NASDAQ: ORCL) and Google over whether Android violates Java patents is about to begin. (WSJ)

Chinese companies increase buyouts of Japanese firms. (WSJ)

European Central Bank official Jörg Asmussen says nations need to put more money into the International Monetary Fund to help stop the European crisis. (WSJ)

Moody’s (NYSE: MCO) may cut ratings of 114 banks in 16 European nations. (WSJ)

Groupon (NASDAQ: GRPN) replaces the head of it international operations. (WSJ)

China’s change in international trading ranges for daily trading is a move to make it a reserve currency. (WSJ)

Housing concerns in the United States and abroad continue to dog the recovery. (WSJ)

Merck (NYSE: MRK) will press for improved manufacturing of its shingles vaccine Zostavax. (WSJ)

Renault keeps share in Europe with low-cost cars. (WSJ)

Gold bulls begin to desert the metal. (WSJ)

New York’s public pension funds successfully press Goldman Sachs (NYSE: GS) and MetLife (NYSE: MET) to disclose data about racial and gender demographics of some of their staffs. (NYT)

Wall St. firms challenge Fed plans to limit their exposure on individual companies and government securities — Bank of America (NYSE: BAC), Citigroup (NYSE: C), Goldman Sachs, JP Morgan Chase (NYSE: JPM) and Morgan Stanley (NYSE: MS) say it will cut credit commitments of over $1.2 trillion. (FT)

Douglas A. McIntyre

Filed under: Press Digest Tagged: BAC, BBY, C, GOOG, GRPN, GS, JPM, MCO, MET, MRK, MS, ORCL

Biopharma Firm Crushed by Merck Deal Cancellation (CRME, MRK)

Paul Ausick — Mon, 19 Mar 2012 15:11:02 +0000

Canadian-based drug company Cardiome Pharma Corp. (NASDAQ: CRME) announced this morning that Merck & Co. Inc. (NYSE: MRK) has cancelled further development of an oral version of a Cardiome drug being reviewed as a maintenance treatment for long-term prevention of atrial fibrillation recurrence. Merck will continue distribution of the intravenous version of the product, which has been approved for use in 37 countries according to the Cardiome press release.

Cardiome said it plans to adopt a more austere budget for 2012:

… Cardiome will reduce its annual operating cash burn going forward to a target of approximately $11M before interest expense, roughly half of the current cash burn. The company ended 2011 with over $53M of cash and cash equivalents and received an additional $25M from the available line of credit from Merck in January 2012. Cardiome expects to release its 2011 year-end financial results on March 28th, 2012 which will allow time to make the necessary changes to its annual filings following this news.

Cardiome’s shares are down more than -53% at $0.91 after posting a new 52-week low this morning of $0.86. The 52-week high is $5.86.

Filed under: Drug companies, Medical, Pharmaceuticals Tagged: CRME, MRK

24/7 Wall St. Closing Bell (DELL, EW, AKS, STLD, BRCM, GMCR, EDMC, NDAQ, QCOM, BZH, BSX, BCO, DO, LEA, MRK, TTWO, VIAB, ZNGA, MNOV, RGDX, BIOS, URG)

Paul Ausick — Thu, 02 Feb 2012 21:08:53 +0000

All three major US stock indexes opened higher this morning, and spent the rest of the day bouncing around the neutral line. The reports from retailers on same-store sales in January were mixed, but overall sales failed to meet expectations. Fed chairman Ben Bernanke testified in Congress today, but did not really give the market much of a push one way or the other. The IPO filing from Facebook after markets closed last night pushed some social media stocks up on a halo effect. WTI crude oil is down 1% at $96.63/barrel and Brent crude is up 0.78% at $112.43/barrel. Gold closed up 0.67% at $1,761.30/ounce.

The unofficial closing bells put the DJIA down about 11 points to 12,705.41 (-0.09%), the NASDAQ rose more than 11 points (0.4%) to 2,859.68, and the S&P 500 rose 0.11% or nearly 1.5 points to 1,325.54.

There were several analyst upgrades and downgrades today, including Dell Inc. (NASDAQ: DELL) raised to ‘overweight’ at JPMorgan; Edwards Lifesciences Corp. (NYSE: EW) cut to ‘neutral’ at Credit Suisse; AK Steel Holding Corp. (NYSE: AKS) cut to ‘underperform’ at BofA/Merrill Lynch; Steel Dynamics Inc. (NASDAQ: STLD) cut to ‘neutral’ at BofA/Merrill Lynch; and Broadcom Corp. (NASDAQ: BRCM) started as ‘buy’ at Canaccord Genuity.

Earnings reports since markets closed last night have led to some price changes as of the last half hour of trading today: Green Mountain Coffee Roasters Inc. (NASDAQ: GMCR) is up nearly 24% at $66.30; Education Management Corp. (NASDAQ: EDMC) is down -17% at $21.19; Nasdaq OMX Group Inc. (NASDAQ: NDAQ) is down -0.6% at $24.62; Qualcomm Inc. (NASDAQ: QCOM) is up 2.2% at $60.88 after posting a new 52-week high of $61.93 earlier today; Beazer Homes USA Inc. (NYSE: BZH) is up 3.2% at $3.27; Boston Scientific Corp. (NYSE: BSX) is down -3.9% at $5.85; Brinks Co. (NYSE: BCO) is down -17.5% at $24.43; Diamond Offshore Drilling Inc. (NYSE: DO) is up 0.35% at $63.29; Lear Corp. (NYSE: LEA) is down -1.2% at $42.48; Merck & Co. (NYSE: MRK) is down -0.3% at $38.51; Take-Two Interactive Software Inc. (NASDAQ: TTWO) is down -0.3% at $15.71; and Viacom Inc. (NASDAQ: VIAB) is down -0.9% at $46.53.

Other standouts from today include the following stocks:

Zynga Inc. (NASDAQ: ZNGA) is up nearly 18% at $12.49 after posting a new post-IPO high of $12.91 earlier today. The social games company got a big boost from Facebook’s IPO filing. Our coverage is here.

MediciNova Inc. (NASDAQ: MNOV) is up nearly 31% at $2.47. The company received a favorable patent notice for a multiple sclerosis treatment device.

Response Genetics Inc. (NASDAQ: RGDX) is up more than 27% at $1.50. The drug maker announced the private placement of about 5.3 million shares at $1.50/share, about 28% higher than last night’s closing price.

BioScrip Inc. (NASDAQ: BIOS) is up more than 15% at $6.73. The pharmacy services provider has sold a portion of its assets to Walgreen Co. (NYSE: WAG) for $225 million.

Ur-Energy Inc. (AMEX: URG) is down more than -13% at $1.22. The uranium miner has issued 1.5 million shares of new stock to agents who will attempt to sell at CDN$1.00.

Stay tuned for Friday. We have noted the following events on the schedule (all times Eastern):

8:30 a.m. – Non-farm payroll report
10:00 a.m. – Factory orders
10:00 a.m. – ISM non-manufacturing (services) index

Paul Ausick

Filed under: 24/7 Wall St. Wire Tagged: AKS, BCO, BIOS, BRCM, BSX, BZH, DELL, DO, EDMC, EW, GMCR, LEA, MNOV, MRK, NDAQ, QCOM, RGDX, STLD, TTWO, URG, VIA-B, ZNGA