Stocks On the Move: Fred's, Inc., Akebia Therapeutics Inc, and TESARO Inc

Discount retailer Fred's, Inc. (FRED), as well as biotech stocks Akebia Therapeutics Inc (AKBA) and TESARO Inc (TSRO) are among the stocks making big moves in today's trading

Dec 20, 2016 at 3:21 PM
facebook twitter linkedin

U.S. stocks are higher as telecom stocks rally. Among specific equities in focus today are discount retailer and pharmacy Fred's, Inc. (NASDAQ:FRED), as well as biotech stocks Akebia Therapeutics Inc (NASDAQ:AKBA) and TESARO Inc (NASDAQ:TSRO). Here's a quick look at what's moving FRED, AKBA, and TSRO.

  • FRED is up a whopping 92.3% at $21.44, and is among the best Nasdaq performers today, after Rite Aid Corporation (NYSE:RAD) announced it would be selling 865 stores to Fred's, Inc. for $950 millionto satisfy antitrust requirements regarding its merger with Walgreens Boots Alliance Inc (NASDAQ:WBA). Earlier, FRED touched a 12-year high of $21.77, and is now up 135% so far in the fourth quarter. Short sellers may be sweating, with FRED's short interest accounting for 9.8% of its float, which would take 12.4 days of trading to cover, at FRED's average daily volume.

  • AKBA is up 25.8% at $10.50, and is also among the top performers on the Nasdaq, after the biotech signed a deal with Japanese firm Otsuka Holdings Co Ltd for the development and marketing of an experimental anemia drug. AKBA will receive $265 million up front, with potential to receive more than $1 billion. Although AKBA still sits down 21% so far in 2016, today's move puts the shares above the $9.50-$10 area that has served as resistance since an early January bear gap. Quite a few short sellers may be finding themselves under water, given AKBA's shorted shares account for 12.1% of the stock's float, which would take nearly three weeks of trading to cover, at AKBA's average daily volume.
  • TSRO is 5.2% higher at $133.84, after the biotech's ovarian cancer treatment, niraparib, was granted a priority review designation by the U.S. Food and Drug Administration (FDA), just a day after sector peer Clovis Oncology Inc (NASDAQ:CLVS) was granted accelerated approval for its ovarian cancer drug. According to one Wedbush analyst, TESARO Inc's niraparib would be the "likely winner" in a head-to-head showdown between the two drugs, with the brokerage firm reiterating an "outperform" endorsement for TSRO. TSRO shares have been on a trek higher since a late-June bear gap, more than tripling in the past six months. Still, TSRO's 10-day put/call volume ratio at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) of 1.17 sits in the top quartile of its annual range, pointing to a healthier-than-usual appetite for long puts over calls of late.
Don't miss the market's next move! Sign up now for Schaeffer's Midday Market Check

Minimize Risk While Maximizing Profits

There is no options strategy like this one, which consistently minimizes risk while maintaining maximum profits. Perfect for traders looking for ways to control risk, reduce losses, and increase the likelihood of success when trading calls and puts. The Schaeffer’s team has over 41 years of options trading success targeting +100% gains on every trade. Rest assured your losses are effectively limited to your initial cost at the time of making your move! Don't waste another second... join us right now before the next trade is released! 



Special Offers from Schaeffer's Trading Partners