Stocks To Watch: Idenix, Cemex, GoPro...

by: SA Stocks To Watch


SA contributors highlight stocks to watch for unusual movement, their bias (long/short), and brief comments.

Stocks are listed alphabetically by symbol. Click on the contributor's name to read more articles by that author.

Discuss today's stocks and ask contributors questions in the comments.

Track how today's Stocks To Watch are performing here. To send in your own ideas for next week's Stocks To Watch, email before 6:00 AM ET Monday.

Idenix Pharmaceuticals (IDIX) - long - Chris DeMuth Jr.

  • A number of merger arb spreads have widened recently.
  • There are ten liquid spreads with a high probability of closing and returns >10%.
  • The widest is IDIX with a $0.47 spread yielding an annualized 34% return.

Cemex (NYSE:CX) - short - Kristian Kolding (no position or plans):

  • CX is reporting its Q2 earnings. Consensus EPS is $0.01. Out of 9 recommendations, CX is rated by 7 analysts as a "strong buy", a "buy" by 1, and a "hold" by 1.
  • Out of the last 4 quarters, CX has surprised negatively 3 times (by more than 50%), and only been in line with consensus 1 time (June 2013).
  • So far this year, the stock is up almost 20%. Although positive long-term outlook remains intact, due to a recovering economy, the share could fall significantly, should earnings disappoint yet again.

GoPro (NASDAQ:GPRO) - long - Don Dion

  • The 25 day quiet period on GPRO will come to an end on July 20, allowing GPRO's underwriters to release (likely positive) research reports on the firm on July 21st.
  • This event could likely lead to a bump in the price of GPRO shares.
  • While concern exists if GPRO can maintain its current share prices long term, we don't believe the hype on this company will decline in the near-term.
  • Given GPRO's strong, influential underwriters, and excellent product, we suggest the quiet period expiration as another great time to buy into this company.
  • Further details here.

Adeptus Health (NYSE:ADPT) - long - Don Dion

  • The SEC-enforced 25 day quiet period on ADPT will come to an end on July 19th, allowing the firm's IPO underwriters to publish analyses on July 20th.
  • Evidence supports a rise in share price at the quiet period expiration, particularly for a firm with strong underwriters like ADPT.
  • We note a short-term buying opportunity at this event time.
  • Further details here.

Imprivata (NYSE:IMPR) - long - Don Dion

  • The 25 day quiet period on IMPR will conclude on July 19, allowing IPO underwriters to release reports on July 20th.
  • The detailed reports will likely be positive; and with such influential firms as J.P Morgan and Wells Fargo scheduled to initiate coverage, these could give IMPR stock a positive boost.
  • Given IMPR's solid market performance, and the recent supportive environment for tech IPOs, we see the quiet period expiration as a good time to buy into this growing company.
  • Further details here.

Xunlei Limited (NASDAQ:XNET) - long - Don Dion

  • July 18 marks the end of the SEC-enforced 25 day quiet period on underwriter research for XNET; July 19th is the first day underwriters can release reports.
  • These detailed research reports will likely be positive and cause a short-term price increase in XNET in the days preceding and following the quiet period expiration date.
  • Although XNET has not performed with consistent strength, its IPO was positive, suggesting investor confidence and excitement in Chinese tech firms.
  • XNET's reputable underwriters, including J.P. Morgan and Citigroup, will likely help boost the price of XNET shares at this time.
  • Further details here.

Peabody Energy (BTU) - long - Pat Stout

  • Trading at levels last seen in 2008 and 2004.
  • Australia repealed carbon tax.
  • Trading below 20 day and 50 day moving averages.

Campbell Soup (NYSE:CPB) - long - Pat Stout

  • Recently downgraded by Goldman.
  • Attractive dividend yield 2.8% vs. US 10-year at 2.5%.
  • 52-week rate of change minus 7.5%, looking for a bounce.

SodaStream (NASDAQ:SODA) - long - Bill Maurer

  • Shares hit a new 52-week low Thursday thanks to the market's fall.
  • The lower shares go, the more likely management takes action, potentially a joint venture or sale.
  • Sizable short interest could spark a short squeeze if stock starts to rebound.

RealPage (NASDAQ:RP) - short - Bill Maurer

  • Company announced preliminary Q2 revenues that were well below estimates.
  • Adjusted EBITDA number also looks extremely weak.
  • Shares could hit new 52-week low.