Más sobre el "inexplicable" comportamiento de ARNA y VVUS los últimos días.
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Don't Act Surprised That Arena Pharmaceuticals (ARNA) & VIVUS (VVUS) Are Tanking
By Bryan Murphy
Jul 31, 2012 11:37:11 AM PDT
Pardon me for asking, but aren't Arena Pharmaceuticals, Inc. (NASDAQ:ARNA) and VIVUS, Inc. (NASDAQ:VVUS) supposed to be soaring to new all-time highs right now on the heels of recent drug approvals? Weren't guaranteed approvals from the FDA going to send shares of VVUS and ARNA into the stratosphere, making instant millionaires out of all those who had the foresight to step into shares of the due of weight-loss drug manufacturers? Yeah, those rabid fans have sure been quiet of late as both stocks have failed to do anything close to what they were predicted to do.... a stark turnaround from the table-pounding certainty being displayed just a few weeks ago.
What happened? We'll get to that in s second. First, some numbers, just for perspective.
The big day for VIVUS, Inc. was on July 17. After the market closed, the Food and Drug Administration announced its weight-loss drug Qnexa (now called Qsymia) has been approved. The stock jumped to an open of $30.33 that day (a multi-year high at the time), and then proceeded to reach a high of $31.21 on the 18th... the first trading day after the approval. Yet, VVUS also fell to a close of $29.00 that same day, and has been falling ever since. The current price of $21.10 is 30% below the immediate post-approval price, and many investors are in the hole by that very amount because they stepped in because of the good news, and have refused to step out.
It's an eerily similar story with Arena Pharmaceuticals, Inc. Its weight-loss drug called Lorcaserin (now called Belviq) was approved during trading hours back in June 27th. The stock immediately jumped from $8.73 to $13.45 on the news, and actually peaked at $13.50 that day. It's been nowhere near there since then, as it started to tumble within minutes later (though we did see a modest bullish blip in early July). Currently at $8.39, ARNA is now nearly 38% beneath its post-approval price.
In the grand scheme of things, the stocks' action doesn't matter a great deal to the overall market. Stocks go up, and stocks go down. Sometimes the reason for the movement makes sense, and sometimes it doesn't. The action does matter to a decent-sized group of biotech investors though, who actually believed in the over-hyped bullish outlooks surrounding both drugs.
And make no mistake - the hyperbolic expectations DID exist, and were shared anywhere a platform to voice such outlooks did exist.
Take these optimistic views on VIVUS for instance:
An approval would make the company worth as much as $40 a share to potential acquirers, said Cowen & Co.,
Rodman & Renshaw set a $52 price target on VVUS, up from $39, after the drug was approved.
Again, the stock's currently at $21.08, and sinking fast.
The bullish insanity existed for ARNA too. Take a look:
Jeffries upped its price target on Arena Pharmaceuticals back on June 28th, from $9.00 to $20.00.
Michael Murphy suggested today's (June 25th) value for Arena Pharmaceuticals shares was between $17 and $21, but would be above $40 by $2016.
Shares are currently valued at $8.44, and falling fast.
To be fair, it's entirely possible both stocks could end up reaching those respective price targets before it's all said and done. On the other hand, if the market really had a present or future intent of doing so, it's not likely traders would have let them slip this far already. More often than not the collective market knows what it's doing, so to see traders - as a group - discount stocks so decisively likely means exactly what it looks like it means.
To answer the original question, "What happened?", it's simple - hype happened. A few traders and professionals with a vested interest in those stocks got access to a little bit of media time, spun a great-sounding story, got retail investors believing - and even retelling - the story, and then used that buying strength to sell into for a nice profit. Clearly those folks would have liked to see a little more strength (both stocks are deep in the red since D-Day), but it was enough... all they needed was enough buyers all at the right time to absorb those sold shares of ARNA and VVUS.
What? How long has this been going on? Uhh... several decades, several times a year. That's why it's amazing that it continues to happen again and again.
Bottom line: There's nothing wrong with Arena Pharmaceuticals, Inc. and VIVUS, Inc. as companies. There's nothing wrong with Belviq and Qsymia as drugs. The underlying stocks, however, disconnected from their corporations, took on a life of their own, and ended up becoming the story themselves. That doesn't happen without a price being paid.
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http://www.smallcapnetwork.com/Dont-Act-Surprised-That-Arena-Pharmaceuticals-ARNA-VIVUS-VVUS-Are-Tanking/s/via/1789/article/view/p/mid/3/id/197/
