Buzz Stocks: Gilead, Tenet Healthcare, ImmunoGen

U.S. benchmarks are pointed lower ahead of the open, as traders prepare for a number of speeches from Fed officials. Among the equities in focus are biopharmaceutical firms Gilead Sciences, Inc. (NASDAQ:GILD) and ImmunoGen, Inc. (NASDAQ:IMGN), as well as health care services provider Tenet Healthcare Corp (NYSE:THC).

• GILD is 3% lower ahead of the open, after the company warned health care providers of its hepatitis C drugs following the death of one patient and adverse effects in eight others. Specifically, the individuals were taking Harvoni or Sovaldi, in conjunction the heart treatment amiodarone. On the charts, Gilead Sciences, Inc. has added 42% year-over-year, finishing Friday at $102.29, yet it has been surrounded by pessimism. For starters, over 56 million shares are sold short, accounting for nearly seven sessions' worth of trading, at normal daily volumes. Also, in the options pits, GILD's 10-day International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) put/call volume ratio of 0.62 is in the 92nd annual percentile, indicating a stronger-than-usual appetite for puts over calls lately.


• THC is way higher this morning, adding 4.6% in electronic trading, following news that the company has agreed to enter into a joint venture with United Surgical Partners International Inc. The deal, which is expected to close later this year, will create the largest ambulatory surgery provider in the U.S. After a tough start to the year, technically speaking, Tenet Healthcare Corp has stormed back, outperforming the S&P 500 Index (SPX) by 10 percentage points during the past two months. The majority of covering analysts have taken bullish positions, with nine of 15 brokerage firms issuing "buy" or better ratings, compared to six "holds" and not a single "sell." Also, THC's average 12-month price target stands at $59.50 -- an almost 20% premium to its settlement price of $49.62 on Friday.


• A licensing agreement with Japan's Takeda Pharmaceuticals Co. has IMGN soaring in electronic trading, with shares pointed 21% higher. The security closed Friday at $7.44, tacking on 39% since touching a multi-year low of $5.34 on Dec. 26. Elsewhere, ImmunoGen, Inc.'s Schaeffer's put/call open interest ratio (SOIR) of 0.28 ranks in the 24th percentile of its annual range, revealing short-term speculators are more call-skewed than normal. On the Street, however, the brokerage firms covering IMGN are decidedly bearish. Eight firms call the stock a "hold" or worse, with the remaining three deeming it a "strong buy."