CXO has been aggregating drilling lands, he says, "and once they have this acreage, they're going to be able to be acquisition candidates by the really big oil companies who don't want to do the legwork."
Citing rising U.S. spending on health care, Baron likes Illumina (ILMN +3.6%), which he says is taking advantage of the falling costs of sequencing the genome.
ILMN is enjoying some analyst love: J.P. Morgan adds the stock to its Focus List and raises its target price to $190 from $120 with little to derail momentum and estimates that remain conservative, and BAML ups its target to $165 from $125.
The sell-side excitement is "the type of stuff that could make for a nice multi-day or multi-week hold," Notable Calls remarks.
The companies will develop and commercialize a multigene, NGS-based test as a companion diagnostic for Vectibix (panitumumab) in the treatment of metastatic colorectal cancer approved in the U.S. and EU.
The test will be developed for use with ILMN's MiSeqDx instrument, which has received premarket clearance from the FDA and CE-marked for the European Union.