Analyst Update: Amarin, MedAssets,Transocean

Analysts adjusted their ratings on Amarin Corporation plc (ADR) (AMRN), MedAssets, Inc. (MDAS), and Transocean LTD (RIG)

Feb 18, 2015 at 12:42 PM
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Analysts are weighing in today on biopharmaceutical firm Amarin Corporation plc (ADR) (NASDAQ:AMRN), healthcare software provider MedAssets, Inc. (NASDAQ:MDAS), and offshore drilling issue Transocean LTD (NYSE:RIG). Here's a quick look at today's brokerage notes on AMRN, MDAS, and RIG.

  • Suntrust Robinson raised its rating on AMRN to "buy" from "neutral" this morning, prompting the shares to advance 11.9% to reach $1.32. On the charts, Amarin Corporation plc is in recovery mode, with the shares up 36% year-to-dat. However, 17.71% of the stock's available float is sold short, which would take over 36 days to cover, at average trading volumes. Should AMRN extend its advance, a short squeeze could translate into an added tailwind.

  • Last night, MDAS reported fourth-quarter earnings, offered up lackluster full-year guidance, announced an extension of its share repurchase plan publicized that current Chairman and CEO John Bardis is retiring and will be replaced by R. Halsey Wise. In response, no fewer than five brokerage firms slashed their price target on the equity, with the most dramatic cut coming from Leerink, which lowered its target to $18 from $26 and its rating to "market perform" from "outperform." Today, the stock is down about 10% at $17.86 -- after touching an annual low of $17 -- steepening a 13.5% year-over-year deficit. Accordingly, puts are popular in the stock's options pits, as MedAssets, Inc.'s Schaeffer's put/call open interest ratio (SOIR) of 1.45 sits in the 85th annual percentile, indicating a bigger-than-usual put bias among near-term traders.

  • RIG is down 1.9% today to reach $17.94, after news broke yesterday that the company is slashing its dividend and replacing CEO Steven Newman. In addition, RIG said it idled another pair of rigs. Reacting was BMO, which initiated coverage on the equity with a price target of $16 and an "underperform" rating, and RBC, which lowered its target price by $3 to $17 and underscored a "sector perform" rating. Looking back, Transocean LTD is down 58.1% year-over-year. Despite the equity's slide, options traders have shown a preference for calls of late. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), RIG's 10-day call/put volume ratio of 1.38 sits higher than 70% of all similar annual readings. Meanwhile, short interest accounts for over 31% of the stock's available float, which would take nearly 10 trading sessions to cover, at average trading volumes.

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