Tag - Biib

Small-cap stocks remained moderately higher into the mid-session time frame, with support from lower inter-bank lending rates and analyst upgrades on key technology and retailer firms offset by a somber reading on manufacturing activity. At 12:53 p.m. ET, the Russell 2000 (NYSE:IWM) was up 3.37, or 0.63% at 540.89.

Analyst upgrades on Biogen Idec Inc. (Nasdaq:BIIB) propped up the tech sector, while an upgrade on Wal-Mart Stores Inc. (NYSE:WMT) underpinned the consumer arena.

Looking at broad market sector activity today, wireless telecoms were the top performers, followed by tire and rubber stocks, multiline insurers, life health insurers, glass and metal container stocks, gold and aluminum. On the downside, casinos were out of favor so far today after posting solid gains late last week. Oil exploration and oil production stocks were down, as were department stores, home improvement retail, automotive retail and oil and gas storage stocks.

Crude oil prices were down about 3%, which likely anchored down energy stocks. The U.S. dollar was firm against the euro, which also hindered upside in commodity products. The Commodity Research Bureau Index of 19 physical markets was off about 0.7%.

The market was trading in very tame fashion today, holding a relatively slim trading range while being devoid of the massive volatility that has been the hallmark of action since mid-September. Perhaps some of the volatility was curbed by traders taking a breather ahead of the U.S. elections Tuesday. In addition, there are still plenty of economic reports to rile things up as the week progresses.

Speaking of economic reports, today’s ISM Manufacturing Survey came in at 38.9%, which was below the forecast of 42.0% and way off the 50% line that . . .

Small-cap stocks slipped into the red shortly after the open, pulled down concerns over a four-year high in the unemployment rate and by massive losses posted by U.S. manufacturing icon General Motors Corp. (NYSE:GM), which only stirs the pot on economic fretting. At 9:51 a.m. ET, the Russell 2000 (NYSE:IWM) was down 4.91, or 0.69%, at 709.62.

Investors and analysts continue to grapple with the mixed details seen on today’s monthly Labor Department employment report. The “headline” figure for non-farm payrolls came in at minus 51,000, which was better than the consensus forecast for a loss of 75,000 jobs. There was some trepidation that the non-farm figure could swell beyond the forecast after Thursday’s dreadful weekly claims report (which was taken after the monthly jobs figures were gathered). The initial response to the non-farm payrolls figure was a six-handle bounce in S&P 500 futures, a firming of the dollar against the euro and a rise in Treasury yields. However, the devil is in the details, and today’s jobs report was not without some troubling aspects.

The most obvious concern on the report was that the nation’s unemployment rate rose beyond expectations, climbing to 5.7%, which marked the highest level in more than four years. In addition, the number of people working part-time for economic reasons rose by 291,000 and has increased by 1.34 million, up 31.5% over the past year.

“Over the past year, the number of unemployed people has increased by more than 1.6 million and the unemployment rate has increased by a full percentage point. In the post-World War II period, every time the unemployment rate has jumped by a full percentage point in the course of a year, the economy has slipped into . . .

Small-cap stocks edged lower Tuesday, with the Russell 2000 (NYSE:IWM) sinking 6.44, or 0.89%, to 718.93. Small caps had plenty of good news to embrace Tuesday, but a wave of sloppy earnings and cautious profit-taking from longs ahead of Wednesday’s FOMC announcement kept the buyers at bay. Small caps noticeably underperformed relative to the Dow and S&P 500, which is a caution signal for the market heading toward huge economic calendar event risk the rest of the week.

Losses were limited by a firm U.S. dollar, which pushed about 0.6% higher versus the euro, rising to the highest point in three weeks. The firm greenback played a role in a sharp retreat in crude oil prices, which tumbled 2.5% in the shadow of yesterday’s record high level. Retail, transportation and airline stocks received a boost from the pullback in energy prices. The commodity spectrum in general was lower Tuesday, with the Commodity Research Bureau Index of commodity prices down 1.8%, pulled lower by the slide in energy and also by a corrective dip in grains a day after corn prices hit record levels.

Within broad market sectors, food retail stocks were up 5%, airlines up 3% and education services were up almost 3%. Meanwhile, fertilizer shares were down 8%, metals and mining were down almost 5%, and agricultural products were down about 4%.

The stock market has been on an impressive upside push since March lows, with the Russell rising about 12%, the Dow up 9.5% and the S&P 500 up about 10%. Given the solid return generated for bulls lucky enough to have caught this brush higher, it’s . . .

Not so long ago, the mention of biotech immediately conjured up thoughts of multibillion-dollar powerhouses like Amgen Inc. (Nasdaq: AMGN), Genentech Inc. (NYSE: DNA) and Biogen Idec Inc. (NYSE: BIIB). But like any sector, change in biotech is inevitable, particularly as makers of cheaper generic and herb-based drugs seek to cut into Big Pharma's market share.
 
Steeped in the 5000-year-old practice of Traditional Chinese Medicine (TCM), Chinese drugmakers and biotech companies combine age-old herbal remedies with high-tech Western medical science—drawing on millenniums of trial and error and the latest advances in technology—to create new drugs for domestic and international markets.
 
Up-and-comer American Oriental Bioengineering, Inc. (NYSE: AOB), a China- and New York-based maker of pharmaceutical and nutraceutical products, is suddenly squarely on the radar of investors. The company develops, manufactures and markets pills, vitamin drinks, patches, gels and powders to treat everything from arthritis to impotence. The pharmaceutical segment creates plant-based prescription and over-the-counter drugs (for pharmacies, clinics and hospitals), while the smaller nutraceutical segment (accounting for 20 percent of company revenues) focuses on developing unregulated natural medications often found in health-food stores, supermarkets and alternative medicine clinics.
 
Analysts, all of whom kicked off coverage with bullish outlooks, have maintained their ratings: on July 9, Piper Jaffray initiated coverage with an "outperform"; analyst Elliot Wilbur with CIBC World Markets issued a July 13 initial "sector outperform" rating; and on Aug. 9, analyst Julie Chen of Brean Murray reiterated her "buy" rating and raised her target price from $14 to $16, while analysts at Lazard Capital maintained their "buy" rating and also raised their estimate. 
 
Second-quarter earnings, reported on Aug. 9, showed the company's profit rose 67% to $9.67 million, or $0.15 a share, from $5.83 million, or $0.09 a share, last year. Revenue increased 48.7% to $33.9 million from $22.8 million in the same period in 2006 (Revenues from pharma products were $26 million, while nutraceuticals brought in $8 million.) Company executives anticipate third-quarter revenues of approximately $42 million, a 55% increase compared with third quarter 2006 revenues of $27.1 million. Analysts, who expect continued growth, have raised EPS estimates for both 2007 and 2008.
 
American Oriental has been aggressively snapping up rivals (four in the past five years, with a fifth on the horizon), allowing it to quickly grow its business. In June, American Oriental bought Changchun Xinan Pharmaceutical Group for $30 million and will soon close a $40 million deal to acquire competitor Guangxi Boke Pharmaceutical Co. Ltd., which will allow the company to double its current offering of about 20 products.
 
"The China pharmaceutical market is very large with approximately $28 billion in sales in 2005 and, importantly, over 20 percent of this market is in Traditional Chinese Medicine products" Wilfred Chow, senior vice president of finance, said at the UBS Global Life Sciences Conference in New York on Thursday. "TCM has been a very important part of the health-care system in China for thousands of years and today many of these proven remedies have been modernized with formulations and manufacturing processes similar to those used in the Western pharmaceuticals."
 
"Our market is not only large but also growing very rapidly. With 1.3 billion people aging and improving their standard of living, health care is our top priority. By 2010, we forecast that China is going to be the fifth largest pharmaceutical market in the world," Chow said.

Chow explained that the PRC government is committed to improving the health-care system in China and named the modernization of TCM as one of its key objectives.

“TCM will remain a mainstream in China health care given the population's preference for green products and the relative affordability of these products compared to Western medicines,” he said. “We think the market will continue to grow rapidly."
 
Chow added: "Because of the platform we have built, we believe that we are well positioned to be a leader in the large and growing market of modernized Traditional Chinese Medicine and nutraceutical products in China."
 
China's General Administration for Quality Supervision, Inspection and Quarantine is taking active steps to clean up its recent problems with food and drug safety issues, which may leave investors more confident in Chinese-made products. A recent PricewaterhouseCoopers report pointed toward Asia as the emerging center for biopharma.

According to the report, titled "Gearing up for a Global Gravity Shift: Growth, Risk and Learning in the Asia Pharmaceutical Market," multinational corporations will be forced to move their operations to the region (from the United States and Europe) to find less expensive places to manufacture drugs, while Asia-Pacific biopharmaceutical companies will increasingly consolidate to penetrate international markets. 
 

The stock closed at $11.43 on Thursday. Shares have traded between $5.67 and $14.19 in the past 52 weeks. Analysts' consensus median target price is $14.50. CEO Shujun Liu holds more than 40% of the company's stock.