Schaeffer's Trading Floor Blog

Biggest Movers: Clovis Oncology Inc, InterDigital, Inc., and Krispy Kreme Doughnuts

CLVS, IDCC, and KKD are moving sharply in Tuesday's trading

by 6/3/2014 12:22 PM
Stocks quoted in this article:

In early afternoon trading, three of the top market movers are biopharmaceutical firm Clovis Oncology Inc (NASDAQ:CLVS), wireless communications expert InterDigital, Inc. (NASDAQ:IDCC) and confectionery chain Krispy Kreme Doughnuts (NYSE:KKD). Here's a quick roundup of how this trio of names is performing on the charts so far.

  • CLVS has shed roughly 17% this afternoon to trade at $39.51, after earlier hitting a fresh annual low of $39.25. In 2014 alone, the stock has shed more than one-third of its value. Pressuring the shares lower today is a downgrade to "neutral" from "buy" at Citigroup, following yesterday's poor drug trial results of an experimental lung cancer treatment. More generally, however, the brokerage bunch is extremely bullish toward Clovis Oncology Inc; five out of six covering analysts have given the stock a "strong buy" rating (compared to one "hold" recommendation), and the equity's consensus 12-month price target stands at an astronomical $98.63. If CLVS continues to struggle, additional downgrades and/or a round of price-target cuts could exacerbate the shares' slide.

  • IDCC has tacked on nearly 19% today on encouraging fundamental news, and is currently up more than 50% year-to-date at $44.33. Earlier, reports surfaced that InterDigital, Inc. and Samsung signed a patent license agreement, and that active and pending litigation between the two was dropped. Moreover, IDCC lifted its second-quarter revenue guidance. On the sentiment front, however, short sellers have targeted the wireless communications name, as 12.4% of its float is sold short -- representing more than a dozen sessions' worth of pent-up buying activity, at the average daily trading volume. Given the stock's technical tenacity, a short-squeeze rally may be on the not-too-distant horizon.

  • Finally, KKD has plummeted nearly 15% to $16.24, following last night's fiscal first-quarter revenue miss and lowered full-year guidance. Additionally, this morning, the equity got hit with a bearish brokerage note at Wedbush. Meanwhile, in the options pits, bearish bettors have been swarming Krispy Kreme Doughnuts. The stock's 10-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) put/call volume ratio of 0.94 ranks in the top quartile of its annual range. In other words, traders have picked up bearish bets (relative to bullish) at an accelerated rate in recent weeks.

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