Here’s Why These Five Stocks Are in the Spotlight

While the second trading week of the fourth quarter is officially over, several major stocks are trending over the weekend, including Twitter Inc (NYSE:TWTR), salesforce.com, inc. (NYSE:CRM), Fiesta Restaurant Group Inc (NASDAQ:FRGI), Valeant Pharmaceuticals Intl Inc (NYSE:VRX), and Ariad Pharmaceuticals, Inc. (NASDAQ:ARIA).

In this article, we are going to take a closer look at the latest developments that put these stocks in the spotlight. In addition, we will assess the smart money sentiment towards each company

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Salesforce.com, inc. (NYSE:CRM) shares rose and Twitter Inc (NYSE:TWTR) retreated after the Financial Times reported that the former was no longer interested in acquiring the social media company. According to Salesforce CEO Marc Benioff, Twitter “wasn’t the right fit” due to “many different reasons”. Salesforce shareholders are no doubt breathing a sigh of relief due to those remarks as a combination of the two might not have yielded enough synergies to justify the premium paid.

To many investors, Salesforce had seemed like Twitter’s most likely buyer due to Alphabet Inc (NASDAQ:GOOG) and Walt Disney Co (NYSE:DIS) both ruling out a bid. Now that Salesforce has also ruled out a purchase, it remains to be seen if there are any plausible companies/entities that could bid for Twitter. Many traders are now bracing for Twitter’s third-quarter earnings report and are hoping that CEO Jack Dorsey’s live streaming strategy will successfully turn the company around. Among the funds we track, 30 held shares of Twitter Inc (NYSE:TWTR) and 60 were long salesforce.com, inc. (NYSE:CRM) on June 30.

Fiesta Restaurant Group Inc (NASDAQ:FRGI) rallied on Friday after the New York Post reported that that the company has notified potential buyers that it wants to sell itself. Fiesta currently operates around 336 eateries and is said to have drawn some interest from various PE firms. Activist Bradley Radoff’s JCP Investment Partnership reported a 6.2% stake in Fiesta on September 19. Sahm Adrangi‘s Kerrisdale Capital also owned 333,156 shares in Fiesta Restaurant Group Inc (NASDAQ:FRGI) at the end of June, up by 110% on the quarter.

On the next page, we find out why Valeant Pharmaceuticals and Ariad Pharmaceuticals are trending.
Now that it isn’t in the regulatory eye anymore (as a certain mega-bank and the maker of EpiPen have taken some of the glare away), Valeant Pharmaceuticals Intl Inc (NYSE:VRX) announced that its Patient Access and Price Committee has, effective October 14, made some price increases the company’s neurology, GI, and urology portfolios. The price hikes are in the range of 2.0% to 9.0% and are aligned with the Committee’s commitment that the average annual price increase will be set at no greater than single digits and below the 5-year weighted average of the rises within the branded biopharmaceutical industry. In reaction to the news, Wells Fargo analyst David Maris said that the hikes might be a result of ‘disappointing prescription trends’. Maris thinks the Street’s estimates for Valeant are too high for 2017 and has an ‘Underperform’ recommendation. A total of 60 funds from our database owned $2.12 billion worth of Valeant Pharmaceuticals Intl Inc (NYSE:VRX)’s stock, which accounted for 30.80% of the float on June 30, versus 71 funds and $3.15 billion, respectively, on March 31.

Although Bernie Sanders won’t be the next President of the United States, his tweets nevertheless can have a strong impact on stocks. Ariad Pharmaceuticals, Inc. (NASDAQ:ARIA) shares fell 14.7% on Friday after the Senator from Vermont tweeted: “Drug corporations’ greed is unbelievable. Ariad has raised the price of a leukemia drug to almost $199,000 a year.” Although it isn’t clear how the tweet might affect Ariad, many investors remember the effect of the regulatory spotlight on Valeant, Mylan NV (NASDAQ:MYL), and others and headed for the exits. The number of funds tracked by us with holdings in Ariad Pharmaceuticals, Inc. (NASDAQ:ARIA) rose by one quarter-over-quarter to 27 at the end of June.

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