Behind the BABA Stock Breakout Today; Plus, Valeant Surges on iNova Sale

iNova sale helps boost Valeant stock, while BABA bolts higher on an upbeat revenue growth outlook

Managing Editor
Jun 8, 2017 at 10:39 AM
facebook twitter linkedin

U.S. stocks are mixed this morning, as markets brace for a potentially volatile day of trading. Among specific names on the move today are Chinese internet issue Alibaba Group Holding Ltd (NYSE:BABA), drug stock Valeant Pharmaceuticals Intl Inc (NYSE:VRX), and retailer Urban Outfitters, Inc (NASDAQ:URBN). Here's a quick look at what's moving shares of BABA, VRX, and URBN.

Upbeat Forecast Has BABA Stock Buzzing

BABA stock is soaring, up 11% to trade at $139.72, and shattering its previous all-time high of $126.40 reached on May 17. The internet retailer raised eyebrows on Wall Street with its tremendously upbeat revenue forecast, projecting monster-sized growth of 45-49% in the 2018 fiscal year.

The stock is up 59% year-to-date, and has outperformed the S&P 500 Index (SPX) by more than 17 percentage points in the last three months. Analysts are feeling the love, as well; all 17 brokerage firms tracking the stock rate BABA a "buy" or better, with 14 of those maintaining "strong buys."

iNova Sale Helps Lift Valeant Stock

VRX stock is up 8% to trade at $13.18 today, after the company agreed to sell its iNova Pharmaceutical business for $930 million. The stock has been on the upswing since touching an eight-year low of $8.31 on April 24, and is testing support at its 80-day moving average. Despite this recent upturn, VRX stock is down 9.2% year-to-date.

The iNova sale may be welcome news for bullish options buyers, however. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), VRX has a 10-day call/put volume ratio of 2.81, which ranks in the 77th annual percentile.

SEC Filing Digs Into URBN Stock

URBN stock is down 9% to trade at $16.57 today, after the company's 10-Q filing revealed that second-quarter comparable sales are negative in the high single-digit range. Now, Urban Outfitters shares are trading at their lowest level since April 2009.

The retail stock has been in steady decline since peaking above $40 last November, with resistance at its 50-day moving average contributing to a year-to-date loss of roughly 42%. More than 19% of URBN's float is currently sold short, with quite a few bears targeting the stock -- yet analysts remain on the fence. Among 24 brokerage firms following URBN, 16 rate the equity a middling "hold."


If you are not making money with options, you aren’t buying options like this…

There is no options strategy that more perfectly approaches trading the fastest moving and most volatile stocks available in the marketplace than this one. In fact, there is no strategy that better utilizes put options for optimal returns and a real trading edge over other traders in the exact same market. New options traders fail out at an incredible rate without proper trade research, execution timing, and option picking. Capitalize on Schaeffer’s 100+ years of options trading excellence with the most coveted product launch in company history. Don't waste another second... join us right now before the next round of trades are released!



Special Offers from Schaeffer's Trading Partners