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St. Jude Medical, Inc. (STJ) Shares Rally Following Mistaken Report Of Acquisition Bid From Abbott Laboratories (ABT)

A report from Financial Times mentioning a potential acquisition bid for St. Jude Medical, Inc. (NYSE:STJ) helped rocket the shares of the company up by nearly 15% in pre-market trading this morning before the rumors were shot down. According to the report, Abbott Laboratories (NYSE:ABT) was preparing to make a $125 billion bid for the medical device maker. However, Abbott Laboratories immediately denied any such action was imminent, negating the majority of St. Jude Medical, Inc. (NYSE:STJ)’s gains. Nonetheless, shares of St. Jude are still up by nearly 4%, as investors perhaps feel Abbott Laboratories is just playing coy so as not to drive the price of the stock up. Miles White, Chief Executive Officer of Abbott Laboratories did note that the company would be interested in potential acquisitions in the medical device sector.

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The shares of St. Jude Medical, Inc. (NYSE:STJ) are now up by 4.76% year-to-date and are trading at $72.71 per share, as of the reporting period. The medical device maker reported better-than-expected second quarter financial results on July 22. St. Jude Medical, Inc. (NYSE:STJ) pulled in earnings per share of $1.03 over revenues of $1.41 billion. The market was expecting EPS of $1.00 along with revenues of $1.39 billion for the quarter. The shares of St. Jude Medical, Inc. have received a consensus rating of “Buy” from analysts covering the stock, along with a price target of $79.67, representing an upside potential of 10% from its current share price. The smart money held a positive outlook for St. Jude Medical, Inc. (NYSE:STJ) during the second quarter, as 41 hedge funds held positions worth $787.35 million. The aggregate holdings grew by 24.80% during the quarter, while the number of hedge funds holding positions was up by four.

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Insider activity can help identify the sentiment held by the insiders of any given company. Looking at the insider activity for St. Jude Medical, Inc. (NYSE:STJ), there were 19 insider sales made so far in 2015. Daniel Starks, CEO of St. Jude Medical, Inc., has sold 200,000 shares of the company year-to-date.

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