Buzz Stocks: Goldman Sachs Group, Valeant Pharmaceuticals Intl Inc, and Five Prime Therapeutics Inc

Today's stocks to watch include Goldman Sachs Group (GS), Valeant Pharmaceuticals Intl Inc (VRX), and Five Prime Therapeutics Inc (FPRX)

Oct 15, 2015 at 10:10 AM
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U.S. benchmarks are higher this morning, as Wall Street weighs the latest batch of quarterly earnings and a solid session overseas. Today's equities in focus are blue-chip banking concern Goldman Sachs Group (NYSE:GS), as well as pharmaceutical firms Valeant Pharmaceuticals Intl Inc (NYSE:VRX) and Five Prime Therapeutics Inc (NASDAQ:FPRX).

  1. GS is 0.9% lower at $177.84 this morning, after missing analysts' third-quarter earnings estimates. Goldman Sachs Group blamed the earnings shortfall on a steep drop in bond trading revenue. Technically, the shares are attempting to stay atop support in the $175-$180 area, which has acted as a foothold in 2015. Option players were stocking up on bullish positions heading into the earnings report. Capitulation from this group could result in bearish headwinds for the shares.
  • VRX plunged 7.7% to $163.24, after news surfaced that the pharmaceutical firm received a subpoena from U.S. prosecutors regarding the pricing and distribution of two of its heart drugs. After hitting a record high of $263.81 in early August, Valeant Pharmaceuticals Intl Inc has surrendered 38.1%. Analysts are bullishly aligned toward VRX, as the biotech boasts seven "strong buys" and one "buy," compared to three "holds" and zero "sells." Downgrades from this optimistic bunch -- or a negative reaction to earnings next Monday, Oct. 19 -- could result in more downside pressure for the shares.
  • FPRX is 49% higher at $25.20, after the company announced an exclusive licensing agreement to develop and market cancer treatments with Bristol-Myers Squibb Co (NYSE:BMY) (subscription required). Five Prime Therapeutics Inc will receive $350 million up front from BMY, and will be eligible to receive more than $1.3 billion in milestone payments and royalties. This morning's gap higher has the shares trading within a hair's breadth of their all-time high of $28.47, tagged at the start of the year. FPRX could be on the cusp of a short-covering rally, as 16% of the equity's float is sold short, which would take more than eight days to exhaust, at FPRX's average daily trading volume.

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