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Early Edge: Boston Scientific, ReneSola, Diana Shipping, and Nuance Communications

BSX scored an early FDA approval, while SOL, DSX, and NUAN all reported earnings

by 11/23/2011 9:26:15 AM
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Checking out a few of today's hot stocks on the move, we've got an unexpectedly speedy FDA approval for Boston Scientific Corporation (BSX), a third-quarter revenue miss from ReneSola Ltd. (SOL), a new stock buyback plan for Diana Shipping Inc. (DSX), and a mixed fourth-quarter report from Nuance Communications Inc. (NUAN).

Boston Scientific

Boston Scientific Corporation (BSX - 5.31) announced last night that the Food and Drug Administration (FDA) has approved its PROMUS Element coronary stent system. The medical device specialist said it plans to begin marketing the product in the U.S. effective immediately. The stent's regulatory OK came sooner than expected, with BSX previously targeting approval by mid-2012.

BSX price chartFollowing the unexpectedly speedy FDA nod, BSX said it will take a fourth-quarter pre-tax charge of $40 million to accommodate the early product launch. However, CEO Hank Kucheman heralded the device's approval as "the beginning of a transition to higher margins" in the company's U.S. stent business.

BSX has gained 6.6% ahead of the open, putting the shares on pace to challenge resistance at their 10-week moving average. This trendline, along with its 20-week counterpart, has pressured the stock lower since May. In fact, BSX has shed nearly 30% of its value so far in 2011.

On the heels of last night's news, J.P. Morgan trimmed its price target on BSX to $6.25 from $7.50 -- although traders appear to be shrugging off this skeptical note, judging by the stock's pre-market momentum. Most brokerage firms already maintain a less-than-enthusiastic opinion of BSX, with Zacks reporting 21 "holds" out of 28 total analyst ratings.

ReneSola

ReneSola Ltd. (SOL - 1.74) confessed to a third-quarter loss of $8.2 million, or 9 cents per American depositary share (ADS), substantially worse than its year-ago profit of $60.1 million, or 70 cents per share. Meanwhile, revenue for the quarter declined 47% to $189.1 million. The results were mixed, as analysts were looking for a loss of 13 cents per share on sales of $218 million.

"Oversupply and weakened demand led to substantial decreases in solar wafer and module prices, which negatively impacted our revenues and margins for the quarter," said CEO Xianshou Li in a statement accompanying the results.

SOL shares are unchanged in pre-market action. Given the security's year-to-date decline of more than 80%, there's a significant amount of pessimism priced into the shares already. SOL's Schaeffer's put/call open interest ratio (SOIR) arrives at 4.04, in the bearishly biased 94th percentile of its annual range. Likewise, short interest accounts for a hefty 11.8% of the equity's float.

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