Yum China receives takeover offer

Yum China rises after reportedly spurning $46 per share takeover bid

Yum China receives takeover offer, Stockwinners
Yum China receives takeover offer, Stockwinners

Shares of Yum China (YUMC) are on the rise following a media report saying the company has rejected a buyout offer of $46 per share made by a consortium led by Hillhouse Capital.

Earlier this month, Bloomberg had reported that China’s sovereign wealth fund, China Investment Corp., was part of the consortium bidding to take Yum China private.

BUYOUT OFFER REPORTEDLY REJECTED

Yum China has rejected a private buyout offer from a consortium of investors that valued the company at over $17B, according to The Wall Street Journal, citing a person familiar with the matter.

An investor group led by Hillhouse Capital Group in recent months offered to take the restaurant operator private at $46 per share, but the all-cash offer was turned down by the company’s board in recent weeks, source told the publication.

Last month, The Information had reported that Hillhouse Capital was in talks to acquire Yum China. The company operates over 8,000 KFC and Pizza Hut restaurants across mainland China.

A takeover led by Hillhouse would assist the company in accelerating its efforts to implement high-tech initiatives in its brick-and-mortar stores in order to attract Chinese millennials, the report pointed out.

CHINA INVESTMENT PART OF CONSORTIUM

Earlier this month, Bloomberg reported that China’s sovereign wealth fund, China Investment Corp., was part of the consortium bidding to take Yum China private.

The sovereign fund and DCP Capital, an investment fund run by former KKR (KKR) executives, are considering a buyout of Yum China, which runs KFC and Pizza Hut outlets, along with Hillhouse Capital, the publication added. Yum China spun off from Yum! Brands (YUM) in 2016.

PRICE ACTION

In tuesday’s trading, shares of Yum China trading in New York are off their earlier highs, but are trading up 3.8% to $37.14.


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Tesla’s going private is questioned by analysts

Tesla consolidates as analysts debate if Musk should take carmaker private

Shares of Tesla (TSLA) jumped yesterday after CEO Elon Musk said he would like to see the company go private, but have since stepped into negative territory as analysts debate the idea.

 

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Tesla’s going private is questioned by analysts, Stockwinners
While Jefferies analyst Philippe Houchois believes going private “feels like the right thing to do,” his peer at Morgan Stanley questions the feasibility of Musk actually being able to achieve that goal.

TAKING TESLA PRIVATE

Yesterday, Tesla CEO Elon Musk tweeted that he is considering taking the electric carmaker private.

 

In an email to the company’s employees, the executive explained: “Earlier today, I announced that I’m considering taking Tesla private at a price of $420/share. […] As a public company, we are subject to wild swings in our stock price that can be a major distraction for everyone working at Tesla, all of whom are shareholders. Being public also subjects us to the quarterly earnings cycle that puts enormous pressure on Tesla to make decisions that may be right for a given quarter, but not necessarily right for the long-term. Finally, as the most shorted stock in the history of the stock market, being public means that there are large numbers of people who have the incentive to attack the company.”
Tesla gets a boost from Bud. See Stockwinners.com
Tesla’s going private is questioned by analysts

Meanwhile, members of Tesla’s board said on Wednesday that they have “met several times over the last week” and are “taking the appropriate next steps to evaluate” Musk’s desire to take the company private. Their talks with Musk, which started last week, included “discussions as to how being private could better serve Tesla’s long-term interests, and also addressed the funding for this to occur,” the board members stated in a press release.

‘RIGHT THING TO DO’:

Commenting on the news, Jefferies’ Houchois told investors in a research note that the move “feels right” even if Musk is downplaying how supportive public markets have been. With Tesla unable to take on more debt, the analyst wonders who may fund the potential deal and end up as a new large shareholder. While the second quarter de-stressed the near-term outlook, Houchois pointed out that Tesla did not reassure about sustained demand for Model 3 at high prices and that profitability can support organic funding of investments in future products and manufacturing capacity.

He continues to think Tesla will need additional capital to fund these or risk being caught with a narrow and ageing product range within 2 years. Noting that his discounted cash flow fair value points to $300 per share, the analyst raised his price target on the stock to $360 from $250, “bridging the gap” to the $420 potential going private bid. The analyst reiterated a Hold rating on Tesla.

BUT WILL IT BE FEASIBLE?:

While Morgan Stanley analyst Adam Jonas sympathizes with Elon Musk’s argument that Tesla could be better off as a private company, he questions the feasibility of the CEO actually being able to achieve that goal.
Taking the company private would assume either that the company is on the verge of generating self-sustaining cash flows or that it can tap into a range of strategic sources of capital not previously at its disposal, said Jonas, who sees strategic value at Tesla, but thinks the “LBO math required to support [a price of] $420 is extremely aggressive.”
Tesla Model 3 named Popular Mechanics' Car of the Year
Tesla Model 3 named Popular Mechanics’ Car of the Year
The benefits of being private are outweighed by the risks of added financial leverage, which could be even more strategically limiting, added Jonas, who reiterated an Equal Weight rating and a $291 price target on Tesla shares.
Meanwhile, his peer at JPMorgan raised his price target for Tesla to $308 from $195 to reflect the possibility of the company going private. However, analyst Ryan Brinkman told investors that he still believes that Tesla’s valuation based on fundamentals alone “is worth no more than $195” per share.
The analyst added that he is not as certain as CEO Elon Musk on Tesla going private, and assigns only a 50% probability to such a scenario, while reiterating an Underweight rating on the shares.

PRICE ACTION:

In Wednesday afternoon trading, shares of Tesla have dropped 1.6% to $373.63.


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US Foods to acquire SGA’s Food for $1.8B

US Foods to acquire SGA’s Food group of Companies for $1.8B 

US Foods to acquire SGA's Food for $1.8B, Stockwinners
US Foods to acquire SGA’s Food for $1.8B, Stockwinners

US Foods (USFD) and Services Group of America announced that they have entered into a definitive agreement under which US Foods will acquire five operating companies collectively known as SGA’s Food Group of Companies, for $1.8B in cash.

The transaction has been unanimously approved by US Foods’ Board of Directors.

Headquartered in Scottsdale, Arizona, SGA’s Food Group of Companies has combined 2017 net sales of $3.2B and approximately 3,400 employees.

SGA’s Food Group of Companies currently operates as five separate operating companies.

US Foods will finance the acquisition primarily with $1.5B in fully committed term loan financing from J.P. Morgan and Bank of America Merrill Lynch and will fund the balance of the purchase price through its existing liquidity resources.

At the closing of the acquisition, US Foods’ pro forma net leverage is expected to be 4.1x.

Given the combined company’s strong cash flow generation, including synergies, US Foods expects to reduce net leverage to approximately 3.0x by the end of fiscal 2020. The acquisition is subject to regulatory approval and other customary closing conditions.

US Foods expects to achieve approximately $55M in annual run-rate cost synergies by the end of fiscal 2022, primarily driven by savings in distribution, procurement and administrative expenses.

The purchase price reflects a multiple of 12.5x SGA’s Food Group of Companies 2018E Adjusted EBITDA of $123 million, after taking into account the approximately $260 million estimated present value of cash tax benefits to be realized as a result of the acquisition. Including $55M in annual run-rate synergies, the price reflects a 2018E Adjusted EBITDA multiple of 8.6x.

Excluding amortization, the transaction is expected to become accretive to US Foods’ Adjusted EPS in the second full year following closing.

USFD closed at $40.60.


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 Apollo in talks to acquire LifePoint Health

Apollo in advanced discussions to acquire LifePoint Health

Apollo in advanced discussions to acquire LifePoint Health, Stockwinners
Apollo in advanced discussions to acquire LifePoint Health, Stockwinners

Apollo Global (APO) is in advanced talks to buy LifePoint Health (LPNT), two people familiar with the matter told Reuters on Friday.

The deal could value LifePoint at nearly $6B, including debt, the sources said, adding that Apollo plans to combine LifePoint with RegionalCare Hospital Partners, another regional hospital operator that it owns.

If the negotiations are completed successfully, a deal could be announced as early as next week, the sources said, cautioning that it was possible talks could fail at the last minute. The sources asked not to be identified because the matter is confidential.

Rural healthcare providers such as LifePoint have been challenged in recent years because their reliance on federal insurers such as Medicare and Medicaid has made them particularly vulnerable to changing reimbursement programs. In addition, hospital operating costs have been rising faster than reimbursement rate increases.

Apollo, which raised a $24.6 billion private equity fund last year, acquired RegionalCare in 2015, and merged it with another hospital operator, Capella Healthcare, in 2016.

It would be by far the biggest acquisition for Apollo this year. LifePoint currently has a market capitalization of $1.9 billion and long-term net debt of $2.9 billion.

LPNT closed at $47.90.


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Zogenix sharply higher on data

Zogenix says primary endpoint achieved in second Phase 3 clinical trial of ZX008

Zogenix sharply higher on data, Stockwinners
Zogenix sharply higher on data, Stockwinners

Zogenix (ZGNX) reported positive top-line results from its second confirmatory Phase 3 study for its investigational drug, ZX008, for the treatment of children and young adults with Dravet syndrome.

Dravet syndrome is a rare, catastrophic, lifelong form of epilepsy that begins in the first year of life with frequent and/or prolonged seizures. Previously known as Severe Myoclonic Epilepsy of Infancy (SMEI), it affects one out of 15,700 individuals, 80% of whom have a mutation in their SCN1A gene.

The study results, which are consistent with those reported in Study 1, Zogenix’s first pivotal Phase 3 study, successfully met the primary endpoint and all key secondary endpoints, demonstrating that ZX008, at a dose of 0.5 mg/kg/day, is superior to placebo when added to a stiripentol regimen. Key Findings: Patients taking ZX008 achieved a 54.7% greater reduction in mean monthly convulsive seizures compared to placebo.

The median reduction in monthly convulsive seizure frequency was 62.7% in the ZX008 group compared to 1.2% in placebo patients. ZX008 also demonstrated statistically significant improvement versus placebo in both key secondary measures, including patients with clinically meaningful reductions in seizure frequency and longest seizure-free interval.

ZX008 was generally well-tolerated in this study with the adverse events consistent with those observed in Study 1 and the known safety profile of fenfluramine.

No patient exhibited cardiac valvulopathy or pulmonary hypertension at any time in the study.

Secondary endpoints assessed ZX008 compared to placebo in terms of the proportions of patients who achieved greater than or equal to 50% reductions and greater than or equal to 75% reductions in monthly convulsive seizures, as well as the median of the longest convulsive seizure-free interval.

ZX008 was generally well-tolerated in this study, with the adverse events consistent with those observed in Study 1 and the known safety profile of fenfluramine.

The incidence of treatment emergent adverse events was similar in both the treatment and placebo groups, with 97.7% of patients receiving ZX008 experiencing at least one treatment emergent adverse event compared to 95.5% of patients in the placebo group.

The most common adverse events in the ZX008 group were decreased appetite, diarrhea, pyrexia, fatigue, and nasopharyngitis.

The incidence of serious adverse events was similar in both the treatment and placebo groups, with 14% of patients in the ZX008 group experiencing at least one treatment emergent serious adverse event compared to 15.9% of patients in the placebo group. T

wo patients in the ZX008 group had an adverse event leading to study discontinuation compared to one in the placebo group.

ZGNX closed at $46.30, it last traded at $55.30.


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Celgene announces positive breast cancer data

Celgene announces IMpassion130 study meets co-primary endpoint of PFS

Celgene announces positive breast cancer data, Stockwinners
Celgene announces positive breast cancer data, Stockwinners

Celgene (CELG) announced that the Phase III IMpassion130 study met its co-primary endpoint of progression-free survival, or PFS.

This is the first phase III study to demonstrate a statistically significant PFS improvement in first-line metastatic or unresectable locally advanced triple negative breast cancer, or TNBC, a type of breast cancer with high unmet need.

Results demonstrated that the investigational combination of Tecentriq plus Abraxane compared to Abraxane monotherapy, as an initial treatment, significantly reduced the risk of disease worsening or death in patients with metastatic or unresectable locally advanced TNBC in the intention-to-treat and PD-L1 positive populations.

Overall survival is encouraging in the PD-L1 positive population at this interim analysis, and follow up will continue until the next planned analysis.

Safety in the Tecentriq plus Abraxane arm appeared consistent with the known safety profiles of the individual medicines, and no new safety signals were identified with the combination.

ABRAXANE is a microtubule inhibitor indicated for the treatment of:

Metastatic breast cancer, after failure of combination chemotherapy
for metastatic disease or relapse within 6 months of adjuvant
chemotherapy. Prior therapy should have included an anthracycline
unless clinically contraindicated.
• Locally advanced or metastatic non-small cell lung cancer (NSCLC),
as first-line treatment in combination with carboplatin, in patients who
are not candidates for curative surgery or radiation therapy.
• Metastatic adenocarcinoma of the pancreas as first-line treatment, in
combination with gemcitabine.

TECENTRIQ is a prescription medicine used to treat:

A type of bladder and urinary tract cancer called urothelial carcinoma.

  • TECENTRIQ may be used when your bladder cancer:
    • has spread or cannot be removed by surgery, and
    • you are not able to take chemotherapy that contains a medicine called cisplatin, or
    • you have tried chemotherapy that contains platinum, and it did not work or is no longer working.

CELG closed at $83.85.


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Novartis receives positive CHMP opinion for Kymriah

Novartis receives positive CHMP opinion for Kymriah

Novartis receives positive CHMP opinion for Kymriah, Stockwinners
Novartis receives positive CHMP opinion for Kymriah, Stockwinners

Novartis (NVS) announced that the Committee for Medicinal Products for Human Use of the European Medicines Agency adopted a positive opinion recommending approval of Kymriah – a novel one-time treatment that uses a patient’s own T cells to fight cancer.

The positive opinion includes two B-cell malignancies: B-cell acute lymphoblastic leukemia that is refractory, in relapse post-transplant or in second or later relapse in patients up to 25 years of age; and diffuse large B-cell lymphoma that is relapsed or refractory after two or more lines of systemic therapy in adults.

If approved by the European Commission, Kymriah will be the first CAR-T cell therapy available in the European Union for both DLBCL and B-cell ALL.

Both B-cell ALL and DLBCL are aggressive malignancies with significant treatment gaps for patients.

In Europe, ALL accounts for approximately 80% of leukemia cases among children, and for those patients who relapse, the outlook is poor. This low survival rate is in spite of patients having to undergo multiple treatments, including chemotherapy, radiation, targeted therapy or stem cell transplant, and further highlights the need for new treatment options.

DLBCL is the most common form of non-Hodgkin lymphoma, accounting for up to 40% of all cases globally.

For patients who relapse or don’t respond to initial therapy, there are limited treatment options that provide durable responses, and survival rates are low for the majority of patients due to ineligibility for autologous stem cell transplant or because salvage chemotherapy or ASCT have failed.

The positive CHMP opinion is based on two pivotal Novartis-sponsored global, multi-center, Phase II trials, ELIANA and JULIET, which included patients from Europe, the US, Australia, Canada and Japan. The collaboration of Novartis and the University of Pennsylvania has led to historic milestones in CAR-T cell therapy since 2012, including the initiation of the first global CAR-T trials, the PRIME designation granted by the EMA for Kymriah in pediatric patients with r/r B-cell ALL, and the approval of Kymriah in two distinct indications by the US Food and Drug Administration.

ELIANA is the first pediatric global CAR-T cell therapy registration trial, treating patients in 25 centers in the US, Canada, Australia, Japan and the EU, including: Austria, Belgium, France, Germany, Italy, Norway and Spain. JULIET is the first multi-center global registration study for Kymriah in adult patients with r/r DLBCL.

JULIET is also the largest global study evaluating a CAR-T cell therapy in patients with DLBCL, enrolling patients from 27 sites in 10 countries across the US, Canada, Australia, Japan and the EU, including: Austria, France, Germany, Italy, Norway and the Netherlands.

The Novartis CAR-T cell manufacturing platform includes cryopreservation, the process of freezing patients’ harvested cells in order to preserve them, which provides physicians with the flexibility to decide when to initiate both the harvesting of patients’ cells and the infusion of Kymriah, based on each patient’s condition, and allows for this individualized treatment approach on a global scale.

The European Commission will now review the CHMP recommendation to deliver its final decision, applicable to all 28 EU member states, plus Iceland, Liechtenstein and Norway.

NVS closed at $73.00, it last traded at $75.50.


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Amazon.com launches new delivery business

Amazon.com launches new offering to help entrepreneurs start delivery businesses

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Amazon.com launches new delivery business

Amazon (AMZN) announced the launch of a new offering that helps entrepreneurs build their own companies delivering Amazon packages.

Amazon will take an active role in helping interested entrepreneurs start, set up and manage their own delivery business.

Successful owners can earn as much as $300,000 in annual profit operating a fleet of up to 40 delivery vehicles.

Individual owners can build their business knowing they will have delivery volume from Amazon, access to the company’s sophisticated delivery technology, hands-on training, and discounts on a suite of assets and services, including vehicle leases and comprehensive insurance.

Over time, Amazon will empower hundreds of new, small business owners to hire tens of thousands of delivery drivers across the U.S., joining a robust existing community of traditional carriers, as well as small-and-medium-sized businesses that already employ thousands of drivers delivering Amazon packages.

The offering provides technology and operational support to individuals with little to no logistics experience the opportunity to run their own delivery business.

To help keep startup costs as low as $10,000, entrepreneurs will also have access to a variety of exclusively negotiated discounts on important resources they’ll need to operate a delivery business.

The deals are available on Amazon-branded vehicles customized for delivery, branded uniforms, fuel, comprehensive insurance coverage, and more.

Amazon is constantly looking for hands-on leaders who think big and deliver results for our customers. These principles are very familiar to those who have served our country in the armed forces.

The company is committing $1M towards funding startup costs for military veterans, offering $10,000 reimbursements for qualified candidates to build their own businesses.

AMZN closed at $1,660.51.


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Heron Therapeutics HTX-001 achieves primary endpoints

Heron Therapeutics HTX-001 achieves primary endpoints in Study 209, 211

Heron Therapeutics HTX-001 achieves primary endpoints, Stockwinners
Heron Therapeutics HTX-001 achieves primary endpoints, Stockwinners
Heron Therapeutics (HRTX) announced positive topline results from two completed Phase 2b studies of HTX-011: Study 209 and Study 211.
HTX-011 achieved the primary endpoints in both studies.
Study 209 was a randomized, placebo- and active-controlled, double-blind, Phase 2b clinical study in patients undergoing primary unilateral total knee arthroplasty to evaluate the analgesic efficacy, safety and pharmacokinetics of HTX-011 locally administered into the surgical site.
Following a dose-escalation phase, 222 patients were randomized to receive: HTX-011 400 mg administered via instillation into the surgical site; HTX-011 400 mg administered via instillation into the surgical site with a low dose of ropivacaine injected into the posterior capsule (HTX-011 combination); bupivacaine 125 mg administered via multiple injections into the surgical site; and placebo.
Ropivacaine and bupivacaine are generically available standard-of-care local anesthetics used in the management of postoperative pain.
This study included a pre-specified hierarchical testing strategy for the primary and key secondary endpoints for the HTX-011 400 mg treatment groups. The primary endpoint was pain intensity as measured by the area under the curve, or AUC, from 0 to 48 hours post-surgery for HTX-011 compared to placebo.
The key secondary endpoint was pain intensity as measured by the AUC from 0 to 72 hours post-surgery for HTX-011 compared to placebo.
The primary and key secondary endpoints were achieved.
Study 211 was a randomized, placebo- and active-controlled, double-blind, Phase 2b dose-finding study in patients undergoing augmentation mammoplasty to evaluate the analgesic efficacy, safety and pharmacokinetics of HTX-011 when administered by instillation into the surgical site or via ultrasound-guided lateral and medial pectoral nerve block before surgery.
The study consisted of three cohorts comparing HTX-011 nerve block to the standard dose of bupivacaine 50 mg, administered as a nerve block, and placebo, and a final cohort comparing both HTX-011 400 mg administered by instillation and HTX-011 400 mg administered as a nerve block to the same two control groups.
A total of 243 patients were enrolled.
The primary endpoint was pain intensity as measured by the AUC from 0 to 24 hours post-surgery compared to placebo. The primary endpoint of the study was achieved.
HRTX closed at $30.70. it last traded at $40.00


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Rockwell Automation to make $1B investment in PTC

Rockwell Automation to make $1B equity investment in PTC

Rockwell Automation to make $1B equity investment in PTC, Stockwinners
Rockwell Automation to make $1B equity investment in PTC

PTC (PTC) and Rockwell Automation (ROK) announced that they have entered into a definitive agreement for a strategic partnership that is expected to accelerate growth for both companies and enable them to be the partner of choice for customers around the world who want to transform their physical operations with digital technology.

As part of the partnership, Rockwell Automation will make a $1B equity investment in PTC, and Rockwell Automation’s Chairman and CEO, Blake Moret, will join PTC’s board of directors effective with the closing of the equity transaction.

Under the terms of the agreement relating to the equity investment, Rockwell Automation will make a $1 billion equity investment in PTC by acquiring 10,582,010 newly issued shares at a price of $94.50, representing an approximate 8.4% ownership interest in PTC based on PTC’s current outstanding shares pro forma for the share issuance to Rockwell Automation.

The price per share represents an 8.6% premium to PTC’s closing stock price on June 8, 2018, the last trading day prior to today’s announcement.

Rockwell Automation intends to fund the investment through a combination of cash on hand and commercial paper borrowings.

Rockwell Automation will account for its ownership interest in PTC as an Available for Sale security, reported at fair value.

As separately announced today, Rockwell Automation is increasing its share repurchase target for fiscal year 2018 to $1.5 billion.

This represents a $300 million increase to its previous plans to repurchase $1.2 billion of its stock in fiscal year 2018.

The investment transaction is subject to customary closing conditions and regulatory approvals, and is expected to close within 60 days.

PTC Inc. develops and delivers software products and solutions worldwide.


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Exact Sciences higher on colon cancer screening

Cologuard maker jumps as colon cancer screening now recommended earlier

Cologuard maker jumps as colon cancer screening now recommended earlier , Stockwinners
Cologuard maker jumps as colon cancer screening now recommended earlier

Shares of Exact Sciences (EXAS) are on the rise after the American Cancer Society released an updated guideline for colorectal cancer screening, saying screening should begin at age 45 for people at average risk.

Previously, the guideline recommended screening begin at age 50 for people at average risk.

UPDATED GUIDELINE

The American Cancer Society released an updated guideline for colorectal cancer screening.

Among the major guideline changes, the new recommendations say screening should begin at age 45 for people at average risk. Previously, the guideline recommended screening begin at age 50 for people at average risk.

Additionally, the American Cancer Society also recommended that people who are in good health and with a life expectancy of more than 10 years should continue regular colorectal cancer screening through the age of 75.

Recommendations for screening test options are also part of the guideline changes.

“There are some differences among the tests to consider, but the most important thing is to get screened, no matter which test you choose,” the American Cancer Society said in a statement, listing the differences between stool-based tests and visual exams.

LEERINK COMMENTS

After the American Cancer Society updated its guideline for colorectal cancer screening to recommend screening begin at age 45 for people at average risk, Leerink analyst Puneet Souda said this is “only directionally positive” for Exact Sciences.

#Souda said the ACS recommendation does not automatically translate into becoming a reality in clinical practice in the near-term, nor does it mean the USPSTF and NCCN automatically follow suit. Souda maintains an Outperform rating on Exact Sciences shares.

PRICE ACTION

In Wednesday’s trading, shares of Exact Sciences have gained over 8% to $56.96. The company sells stool-based test Cologuard, a noninvasive colorectal cancer screening test.


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Barron’s is bullish on Apple and Exxon

Barron’s, the weekly publication owned by the Wall Street Journal, in its latest issue mentions several names:

Stockwinners offers Barron's review of Stockwinners offers stocks to buy, stocks to watch, upgrades, downgrades, earnings, Stocks to Buy On Margin
Stockwinners offers Barron’s review of stocks to buy, stocks to watch

BULLISH   MENTIONS

Apple reaffirms position as tech’s ‘undisputed’ leader – In a follow-up story, Barron’s says that with its earnings report last week, Apple (AAPL) flexed its financial muscle and reaffirmed its position as “tech’s undisputed leader.” Fiscal second-quarter iPhone sales came in roughly as expected, while the company’s total profit was slightly ahead of estimates, the report notes, adding that Apple’s real surprise came from its updated buyback plans. Investors rewarded the company with its best five-day stretch in the stock market since October 2011, Barron’s says.

Apple raking in profits amid technology impasse – Warren Buffet’s Berkshire Hathaway (BRKA) has bought another 75M shares of Apple (AAPL), Tiernan Ray writes in this week’s edition of Barron’s. While the current impasse for technology is going to continue to reduce new opportunities for Apple, for competitors such as Samsung (SSNLF) and suppliers like Qorvo (QRVO), there is enough wealth in the steady supply of what exists to keep investors like Buffett delighted with the cash flow, he contends. Milking it, at the moment, triumphs over innovation, Barron’s says.

Boeing eyeing ‘air supremacy’  – Boeing  (BA) announced last week that it would acquire KLX, whose products include airplane parts, as part of the aircraft manufacturer’s long-term plan to bolster its presence in parts, components, and services, Lawrence Strauss writes in this week’s edition of Barron’s. This is a trend investors should keep an eye on, he contends.

Sarepta winning over investors – Sarepta Therapeutics (SRPT) has been winning over investors with rising sales of its drug to treat Duchenne muscular dystrophy and a promising pipeline of drugs targeted at the fatal muscle-wasting disease, Andrew Bary writes in this week’s edition of Barron’s. Part of the optimism surrounding Sarepta is that it can bring to market two drugs similar to Exondys 51, which treats about 13% of DMD patients, he notes, adding that these drugs – casimersen and golodirsen – target mutations at other points on the dystrophin gene and could treat another 16% of DMD patients.

Exxon Mobil looks appealing – Demand for oil and natural gas is expected to be strong for decades and to capitalize on this growth, Exxon (XOM) has an ambitious plan to increase the company’s energy output by 25% and more than double earnings by 2025, Andrew Bary writes in this week’s edition of Barron’s. At a share price of $77, Exxon looks “appealing,” he adds.

BEARISH  MENTIONS

Wolverine may face mounting cleanup costs – The Scotchgard chemicals that gave stain resistance to Wolverine’s Hush Puppies shoes have leached into wells and aquifers from rusting barrels of sludge and other factory waste scattered around Michigan’s Kent County, where Wolverine (WWW)  used the chemicals for about 50 years, Bill Alpert writes in this week’s edition of Barron’s. The footwear firm has provided water filters to area homes and last year it set aside $35M to cover expected legal and remediation costs, but the question is whether $35M is enough, Barron’s notes.


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Apple announces new $100B buyback program, boosts dividend by 16%

Apple announces new $100B buyback program, boosts dividend by 16%

Stocks to Buy, Stocks to Buy on Margin, Stocks to invest in, stocks to own
Apple announces new $100B buyback program, boosts dividend by 16%

Apple (AAPL) said it will complete the execution of the previous $210B share repurchase authorization during fiscal Q3 and announced a new $100B buyback program.

Its board has declared a cash dividend of 73c per share of Apple’s common stock payable on May 17, to shareholders of record as of the close of business on May 14.

“Our business performed extremely well during the March quarter, as we grew earnings per share by 30 percent and generated over $15 billion in operating cash flow,” said Luca Maestri, Apple’s CFO.

“With the greater flexibility we now have from access to our global cash, we can more efficiently invest in our US operations and work toward a more optimal capital structure.

Given our confidence in Apple’s future, we are very happy to announce that our Board has approved a new $100 billion share repurchase authorization and a 16 percent increase in our quarterly dividend.”

Separately, Apple reported Q2 EPS $2.73, consensus $2.69 – Reported Q2 revenue $61.1B, consensus $60.98B.

Apple reported Q2 iPhone units 52.22M vs. 50.76M last year – Reported Q2 iPad units 9.11M vs. 8.92M last year. Reported Q2 Mac units 4.08M vs. 4.2M last year.

AAPL closed at $169.10.


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AbbVie to buyback $7.5 billion of its own shares

AbbVie commences self-tender offer for up to $7.5B of common stock

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AbbVie to buyback $7.5 billion of its own shares

AbbVie (ABBV) announced that it has commenced a modified “Dutch auction” tender offer to purchase for cash up to $7.5 B of its common stock at a price not less than $99.00 per share and not more than $114.00 per share.

AbbVie stockholders may tender all or a portion of their shares at a price specified by the tendering stockholder within this range.

When the tender offer expires, AbbVie will determine the lowest price within the range of prices specified above that allows AbbVie to purchase up to an aggregate of $7.5B of its common stock.

The tender offer and withdrawal rights will expire at midnight Eastern Time, at the end of the day on May 29, 2018, unless extended or terminated by AbbVie.

Tenders of shares must be made prior to the expiration of the tender offer and may be withdrawn at any time prior to the expiration of the tender offer. Morgan Stanley & Co. is acting as dealer manager, and Wachtell, Lipton, Rosen & Katz is acting as legal advisor.

ABBV closed at $96.55. Shares have a 52-week trading range of $64.61 – $125.86.


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Alexion Pharmaceuticals announced positive topline results of ALXN1210

Alexion says Phase 3 ALXN1210 study shows patients can be switched from Solirs 

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Alexion Pharmaceuticals  announced “positive” topline results of a Phase 3 study of ALXN1210

Alexion Pharmaceuticals (ALXN)  announced “positive” topline results of a Phase 3 study of ALXN1210, the company’s investigational long-acting C5 complement inhibitor, which show that patients with paroxysmal nocturnal hemoglobinuria “can be effectively and safely switched from treatment with Soliris every two weeks to treatment with ALXN1210 every eight weeks.”

The study demonstrated non-inferiority of ALXN1210 to #Soliris in patients with PNH who had been stable on Soliris based on the primary endpoint of change in lactate dehydrogenase levels, a direct marker of complement-mediated hemolysis in PNH, the company said.

It adds that the study also demonstrated non-inferiority on all four key secondary endpoints: the proportion of patients with breakthrough hemolysis, the change from baseline in quality of life as assessed via the Functional Assessment of Chronic Illness Therapy-Fatigue Scale, the proportion of patients avoiding transfusion, and the proportion of patients with stabilized hemoglobin levels.

In addition, numeric results for all five endpoints favored ALXN1210. Notably, no patients treated with ALXN1210 experienced breakthrough hemolysis compared to five patients treated with Soliris, Alexion said.

It noted that ALXN1210 was generally well tolerated with a safety profile that is consistent with that seen for Soliris. “Once again ALXN1210 met the high bar set by Soliris in a second, large Phase 3 study.

Importantly, we now have robust data that patients with PNH can effectively and safely transition from Soliris to ALXN1210,” said John Orloff, M.D., Executive Vice President and Head of Research & Development at Alexion.

“We are very pleased that the totality of the Phase 3 PNH data in more than 440 patients, which included patients who had never received a complement inhibitor and patients who were stable on Soliris and switched to ALXN1210, shows numeric results favoring ALXN1210 across all primary and key secondary endpoints, including breakthrough hemolysis.

We believe that the differentiated profile of ALXN1210 could be a meaningful improvement for patients and clinicians and look forward to moving rapidly to global regulatory filings in the U.S. and EU in mid-2018, followed by Japan later in the year.”


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