Today’s news: Alexion Pharmaceuticals (ALXN) moves from Buy to Hold. Price action and/or news on KLX Energy Services (KLXE), Supernus Pharmaceuticals (SUPN) and TiVo (TIVO).
Alexion Pharmaceuticals (ALXN) moves from a Buy to a Hold recommendation. The stock is up about 44% from its December low, and rapidly approaching price resistance at 140. There’s a strong likelihood that a pullback will occur soon. Hold.
KLX Energy Services (KLXE) fell 5.9% yesterday. There was no discernable news related to the price volatility. Hold.
Supernus Pharmaceuticals (SUPN) reported a strong fourth quarter this week. The number of prescriptions for Trokendi XK and Oxtellar XR increased by 34% and 12%, respectively, in 2018. Oxtellar XR has a significant long-term growth opportunity with its recent label expansion that includes monotherapy for partial seizures. Pipeline products include potential therapies for ADHD, impulse aggression associated with ADHD and severe epilepsy. Supernus will host an Investor Day on April 16, 2019.
The stock peaked at 60 in 2018, so that’s likely your maximum upside in 2019 as SUPN recovers along with the broader stock market. Expect volatility. Strong Buy.
TiVo (TIVO – yield 7.5%) – I listened to the quarterly earnings conference call last night. Business continues to hum along, with new products and contract wins.
The main issue that everybody is paying attention to—the tail that’s wagging the stock price—is TiVo’s strategic review. The company is involved in ongoing discussions with parties who are interested in the company’s businesses—product and IP licensing—and otherwise examining possible ways to increase shareholder value. The CEO stated, “We are proactively working internally on the various logistic issues that would need to be addressed in the event that the two businesses are separated.” This work includes preparation of historical financials, audits, tax implications and costs. (The costs are not expected to be significant.)
I continue to recommend TIVO shares as a potentially lucrative small-cap opportunity for risk-tolerant investors. Keeping in mind that this potential M&A situation was first revealed back in December 2017 when the share price was approximately 19, it makes sense that the company is even more undervalued now at a lower share price. TIVO is suitable for patient small-cap stock investors. Strong Buy.