Hot Stocks: XM, Sirius Satellite Among Monday's Movers
Analyst actions and clinical trial data were some of the catalysts behind the most actively traded stocks on Monday.
Shares of both XM Satellite Radio and Sirius Satellite Radio advanced on above-average trading volume on Monday after the Federal Communications Commission began the long-awaited public notice period of the proposed merger of the satellite radio providers.
"Over the next 30 days, we will have the opportunity to assess how strong the opposition to the merger is, as the Dept. of Justice process is not as transparent," wrote Bear Stearns analyst John Boris.
The analyst, who upgraded Sirius shares last week to "outperform" from "peer perform," said the concerns the merger will fail has weighed on Sirius shares and has created an attractive risk-reward situation.
"We think that conservative fundamentals alone support our recent upgrade; and while we believe the merger closing probability is higher than market sentiment, we think investors can still enter assuming the merger fails," Boris said.
Medivation shares surged more than 25% after the small biotech firm announced positive clinical trial data for experimental drug Dimebon, a treatment for Alzheimer's disease. The company said the drug prevented mental deterioration in patients with mild to moderate Alzheimer's for a year.
Shares of Ingram Micro rose after Citigroup upgraded the stock to "buy" from "hold," citing improving return on capital, accelerating U.S. end-market growth and a more attractive valuation. Analyst Joe Yoo said in a client note that Dell's recent restructuring efforts bode well for tech hardware distributors.
"We expect Dell's recent soul searching to result in agreements with retailers and distributors to sell Dell product in coming months," Yoo said. "This should reinforce the notion that wholesale distributors like IM play a vital role in the IT supply chain."
Shares of Chinese Internet portal Sina gained on news the company was partnering with Google to increase Sina's search functions. Terms of the deal were not discussed.
UST shares rose after UBS upgraded the tobacco company to "buy" from "neutral." The research firm said Altria subsidiary Philip Morris' plans to test-market snus, a Swedish smokeless tobacco product, under the Marlboro brand should bring investors' attention to UST, which markets Skoal and Copenhagen.
Among downside movers, Qwest Communications International fell on heavy trading volume after the telecom services provider said CEO and chairman Richard Notebaert will retire soon.
"The time has come for me to spend more time with family and focus on other commitments," Notebaert said in a prepared statement.
The company is currently searching for a replacement for the 59-year-old executive but no timetable has been set, it said.
Nucor fell after the steelmaker issued a quarterly earnings warnings, saying it expects second-quarter earnings to fall to $1.05 to $1.15 a share. The company said results were affected by reduced demand for bar and rebar products.