A day after surging sharply due to the hiring of Dr. David Hung as CEO, Axovant Sciences Ltd (NYSE:AXON) shares are off to the races once again, this time rising $1.71 per share, or 9.22%, on Tuesday to close above the $20 level. Traders bid up the shares of the company due to a spot secondary in which Axovant sold 6.742 million shares at $18.54 each. Although stocks typically fall when a company issues a secondary, Axovant’s offering is the exception to the rule.
Given the recent price action due to the hiring of Dr.Hung, it certainly seems that many investors expect Axovant to be a potential replay of David Hung’s prior company, Medivation, which sold to Pfizer for $14 billion. In terms of the Medivation sale, Dr. Hung was able to trigger a bidding war which led to a 118% premium at the end. Investors can only hope that Axovant experiences the same fate. That Dr. Hung chose Axovant over his many other job offers is certainly reassuring, but ultimately the company will still need to follow through and successfully develop its Alzheimer’s drug candidate, which remains a risky undertaking.
What Does The Smart Money Sentiment Say?
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According to our data, 16 elite funds were long Axovant Sciences Ltd (NYSE:AXON) at the end of December, down 4 funds from the previous quarter.
The Bottom Line
Axovant Sciences Ltd (NYSE:AXON) shares rallied again on Tuesday, this time due to a spot secondary. For more reading, check out ‘11 States with the Toughest Drug Laws in America‘.