Analyst Update: Keryx Biopharmaceuticals, First Solar, Inc., and Tesla Motors Inc

Analysts are weighing in on Keryx Biopharmaceuticals (KERX), First Solar, Inc. (FSLR), and Tesla Motors Inc (TSLA)

Nov 9, 2016 at 3:37 PM
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U.S. stocks are recovering from early losses following Donald Trump's surprise victory in the U.S. presidential election. Among stocks in focus today are biotech Keryx Biopharmaceuticals (NASDAQ:KERX), solar stock First Solar, Inc. (NASDAQ:FSLR), and electric auto maker Tesla Motors Inc (NASDAQ:TSLA). Here's a quick roundup of today's brokerage notes on KERX, FSLR, and TSLA.

  • KERX is enjoying the healthcare rally, trading 11.5% higher at $5.35, after the firm reported stronger-than-expected quarterly revenue and said the U.S. Food and Drug Administration (FDA) granted approval for a second contract manufacturer for the dialysis drug, Auryxia. Further boosting the biotech is an upgrade to "buy" from "hold" by Maxim Group. Keryx Biopharmaceuticals now sits up 5.9% so far this year, though the shares would need to rally roughly 27% in order to fill their post-earnings bear gap in August. Some short sellers are likely kicking rocks after today's rally, with KERX's short interest up 8.3% over the last two reporting periods. Shorted shares now account for 29.4% of KERX's float, which would take over three weeks of trading to cover, at the stock's average daily volume.
  • FSLR is falling amidst a larger solar sector decline stemming from Donald Trump's victory, down 4.5% at $31.98, and just off a three-year low of $30.85. Roth Capital was one of many brokerage firms to wax pessimistic on the future of the solar power sector, saying solar power is unlikely to be prioritized by the new administration. "The combination of a Trump presidency and GOP legislature could result in a wholesale dismantling of many of the solar incentives and policies at the federal level," the analysts said, predicting "another leg down for nearly all of our solar stocks under coverage." Today's decline is more of the same for struggling FSLR, which is down over 50% year-to-date. A few FSLR option traders are likely cheering today's decline, with the stock's Schaeffer's put/call open interest ratio (SOIR) of 0.96 sitting in the 89th percentile of its annual range, suggesting near-term option players have been more put-skewed than usual.

  • TSLA -- which also has a stake in clean energy, especially considering its romance of SolarCity Corp (NYSE:SCTY) -- is also taking it on the chin, shedding 3.5% to trade at $188.10. Oppenheimer analyst Colin Rusch discussed potential consequences for TSLA on a Trump win, saying it "injects significant policy uncertainty into the growth outlook for multiple verticals, with solar/alternative transportation plays the most impacted," while some shareholders are concerned the president-elect won't renew tax credits for electric vehicle buyers. TSLA is now down 20% in 2016, trading at eight-month lows. Quite a few Tesla Motors Inc short sellers are likely cheering this recent development, especially given that shorted shares account for nearly a quarter of TSLA's float, which would take over a week and a half of trading to cover, at TSLA's average daily volume.
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