Friday, July 3, 2015 - 3:20pm

On 1 July, 2015, Axalta Coating Systems (NYSE: AXTA) completed the acquisition of
Metalak Benelux B.V. For more than 60 years, Metalak has been the
exclusive distributor of Axalta's Spies Hecker® refinish
coating products sold in the Netherlands and in Flanders, Belgium.
Formerly a privately owned company, Metalak has offices in Bornem,
Belgium and in Tiel, the Netherlands and will continue to operate under
the Metalak name. The agreement will take effect immediately.

Dirk Lippens, Country Business Manager for Axalta in the Benelux, says,
"Metalak has been operating successfully in the premium segment of the
refinish market in the Netherlands and in Belgium for many years, and

See full press release

Friday, July 3, 2015 - 10:29am

In a report published Friday, Credit Suisse analyst Colin McCallum published a sector report that maintained an Overweight rating on the Chinese Telecoms ahead of the 1H15 results.

China Unicom (Hong Kong) Limited (NYSE: CHU) (HKG: 0762), China Mobile Ltd. (NYSE: CHL) (HKG: 0941) and China Telecom Corporation Limited (NYSE: CHA) (HKG: 0728) are scheduled to report their 1H15 results in August. Analyst Colin McCallum expects the 1H15 results to continue to be affected by VAT, which was implemented on June 1, 2014, and the 2Q15 results to be affected by seasonality, following the Chinese New Year.

China Mobile is expected to report a 9.2 percent y/y decline in earnings. Unicom is expected to report 4.3 percent y/y growth in EBITDA, while its net profit is expected to decline 3.2 percent y/y. China Telecom is expected to report flat earnings.

In the report Credit Suisse noted, "China Mobile already announced in March that the FY15 capex budget has been set 6.5% lower than the FY14 capital expenditure, and that the capex budget will decline further into FY16. For FY15 as a whole, we expect a recovery in revenue growth to be driven by an ARPU uplift from 4G penetration rising throughout the 816mn-strong subscriber base."

McCallum commented that there were expectations that China Mobile's launch of 4G would severely impact Unicom's ability to grow revenue, and "a step downwards in the rate of 3G/4G net additions since August 2014, and continuing across 1H15, appears to suggest this bearish thesis is playing out."

"Our overall point of view continues to be that the China data market as a whole can grow, and does not represent a 'zero sum game'. Unfortunately, the imposition of VAT and the shift from handset subsidies to tariff discounts will make assessing relative YoY revenue growth difficult, but we note that Unicom was able to grow revenue QoQ into 1Q15, and we do expect some further growth QoQ into 2Q15," McCallum explained.

China Telecom has witnessed solid 4G net add numbers, averaging 2.1 mn per month. Taking this into consideration, the Credit Suisse report added, "…we expect an ARPU uplift as customers shift to 4G, the market will be looking for ongoing growth in revenue and EBITDA from China Telecom, together with stable YoY earnings."

Friday, July 3, 2015 - 10:25am

In a report published Friday, HSBC analyst Andy Hargreaves maintained a Buy rating on Weibo Corp (ADR) (NASDAQ: WB), while reducing the price target from $22 to $21, noting the company's closer cooperation with Alibaba Group Holding Ltd (NYSE: BABA).

"Weibo has 89m daily active users, mostly young (50% of its users less than 25 years old) and geographically diverse (only 25% of its users are in Tier 1 cities). Weibo users seek information and are influenced by the platform's 8m key opinion leaders (KOL)," analyst Andy Hargreaves wrote.

The company is now developing verticals that are closely integrated with Alibaba. "For example, Weibo's movie page allows celebrities and KOL to promote films. Youku and SINA provider trailers and tickets can be purchased via Tabao Movies," the HSBC report said.

Hargreaves believes that Alibaba can boost traffic for Weibo's video content, while the latter can capture "larger budgets from the studios and FMCG [fast-moving consumer goods] and auto."

Weibo already enjoys the position of an important channel for Alibaba to promote its quarterly promotional events. Weibo also provides closed loop transactions for Taobao merchants. "This integrated approach for key verticals should tie Weibo more closely with Alibaba," Hargreaves added.

Friday, July 3, 2015 - 10:21am

In a report published Friday, Evercore ISI analyst Mark Schoenebaum mentioned the abstracts and companies he would be tracking during the upcoming AAIC.

This could include aducanumab by Biogen Inc (NASDAQ: BIIB) and solanezumab by Eli Lilly and Co (NYSE: LLY).

AAIC is scheduled between July 18 and 22. Analyst Mark Schoenebaum noted the planner for abstracts that they would be will be tracking:

Saturday - July 18


Comparison of Reference Regions for Improved Detection of Change in Florbetapir PET from Phase 3 Solanezumab Trials
Exhibit Hall E
12:15pm - 2:15pm

Tuesday - July 21


Safety of Solanezumab in the Expedition-EXT Study up to 2 Years in a Mild to Moderate Alzheimer's Disease Population
Exhibit Hall D
9:30am - 4:15pm

  • ORAL

Comparison of Reference Regions for Improved Detection of Change in Florbetapir PET from Phase 3 Solanezumab Trials
Hall E
2:00pm - 3:30pm

Wednesday – July 22

  • ORAL

Delayed-Start Analyses of up to 3.5 Years in the Phase 3 Solanezumab Expedition Program in Mild Alzheimer's Disease
Ballroom A
8:00am - 9:30am


Rvt-101, a 5-HT6 Receptor Antagonist, As Adjunctive Therapy with Donepezil in Adults with Mild-to-Moderate Alzheimer's Disease: Responder Analysis
Exhibit Hall E
9:30am - 4:15pm

  • ORAL

Aducanumab (BIIB037), an Anti-Amyloid Beta Monoclonal Antibody, in Patients with Prodromal or Mild Alzheimer's Disease: Interim Results of a Randomized, Double-Blind, Placebo-Controlled, Phase 1B Study
2:00pm - 3:30pm

  • ORAL

The Efficacy of Rvt-101, a 5-HT6 Receptor Antagonist, As an Adjunct to Donepezil in Adults with Mild-to-Moderate Alzheimer's Disease: Completer Analysis of a Phase 2b Study
Hall E
2:00pm - 3:30pm

  • Axovant Investor Briefing

Doors open at 5:15pm
Presentation begins 5:45pm
Marriott Marquis, Georgetown Room, 900 Massachusetts Ave. Northwest, Washington, DC 20001

Friday, July 3, 2015 - 9:41am

Mike Khouw said on CNBC's Options Action that call options outnumbered put options 2 to 1 in Micron Technology, Inc. (NASDAQ: MU) on Thursday.

He noticed that traders were buying the January 2017 25 calls and it looked to him that someone is trying to roll a position.

A trader bought over 20,000 contracts of the January 2017 25 calls for $1.75, taking a bet that Micron Technology, Inc. could rebound. The trade would be profitable if the stock jumps 40 percent or more in 18 months.

Friday, July 3, 2015 - 9:40am

On CNBC's Stock Pops & Drops, Guy Adami said that despite the high valuation of Vertex Pharmaceuticals Incorporated (NASDAQ: VRTX) traders should stay long. The stock gained 4.02 percent on Thursday.

David Seaburg is a buyer of Humana Inc (NYSE: HUM) after it fell 2.83 percent, because he thinks that it is a take over target.

Tim Seymour would take a closer look at The Western Union Company (NYSE: WU) at $17.50. He thinks that the stock is not broken after it fell 6.87 percent and it closed at $18.99.

Brian Kelly said that BP plc (ADR) (NYSE: BP) gained 5.17 percent on a settlement for the Deepwater Horizon oil spill. He would use this opportunity to sell.

Friday, July 3, 2015 - 9:39am

Facebook Inc (NASDAQ: FB) is reportedly talking to a number of record labels, including Sony Music Group, Warner Music Group and Universal Music Group.

Little is known about the talks, but it sounds an awful lot like the hype that preceded the debut of Apple Inc.'s (NASDAQ: AAPL) music service. Before its official reveal, Apple was thought to be meeting with the industry's biggest labels.

"There's a lot that connects social media and any entertainment medium," Rob Enderle, principal analyst at Enderle Group, told Benzinga. "People like to share what they see and like. That's what Zune was all about -- this idea of sharing."

Enderle said that it "makes sense" that a social media company "might see this as a feature they can add and create something else people will talk about."

"I don't think it's a bad idea for Facebook," he continued. "We'll have to see how they're going to execute. Clearly music is going to be new to them. But because the social aspect of music has always been a big goal for music services, having a social media company decide that music could be a feature seems like a logical extension."

Related Link: Should You Pay To Be 'Liked' On Facebook Inc?

Discovering New Sounds

Global Equities Research analyst Trip Chowdhry compared Facebook's potential venture to that of Apple Music. He said that Apple's service, which is available for $9.99 month, will not annoy listeners with advertisements or other interruptions.

"Where Apple Music will fail is discoverability," said Chowdhry. "How do you discover something that's very good if it's a no-name artist? Suppose you [perform] good music but I have no idea. Discoverability will be a problem in Apple."

Facebook could excel in that area, but Chowdhry thinks it must overcome a few obstacles first.

"[Discoverability] is very strong on Facebook," said Chowdhry. "It adds a lot of value to, say, an unnamed musician. The question to ask is: does it provide a very good value from the consumption point of view? Because Facebook is an ad-driven model, and do you want to be interjected with an ad?"

Chowdhry also questioned the success a record label might have by partnering with Facebook.

"You can buy 1,000 'likes' on Facebook for $50," he said. "How do you know that's high-quality?"

If a "like" can be purchased, Chowdhry is concerned that a similar level of manipulation could be used for recording artists. This would disguise an artist's actual performance and make it difficult to determine if Facebook was successful in promoting the band.

Consolidation Ahead?

Aside from the Apple-Beats merger, there haven't been too many acquisitions in the streaming music space. Chowdhry doesn't expect that to change. He thinks there will be "hyper-specialization" (where there are multiple services meeting the needs of many individuals) instead of consolidation.

Enderle, however, thinks that the sheer number of music services mean that "we'll likely see a certain amount of consolidation in the market."

"If Facebook executes marginally well, I wouldn't expect them to be one of the ones that goes away because they have the critical mass of folks that like to do stuff together," Enderle concluded.

Disclosure: At the time of this writing, Louis Bedigian had no position in the equities mentioned in this report.

Friday, July 3, 2015 - 9:36am

Many investors consider tracking hedge fund moves central to their strategy.

So, let’s take a look at Thursday’s most relevant transactions involving small-cap companies.

The largest company featured in this article is a $2 billion market cap specialty chemicals manufacturer: Olin Corporation (NYSE: OLN).

Shares of the company fell more than 2.7 percent on Thursday trading, despite the fact that Steven Cohen’s Point72 added 3,832,254 shares to its holdings, which now amount to 4,060,154 shares, or 5.2 percent of the shares outstanding. It should be noted that this stake has an activist nature.

Another small-cap that tumbled on Thursday in spite of a hedge fund betting on it was Pernix Therapeutics Holdings Inc (NASDAQ: PTX).

Although Steven Boyd’s Armistice Capital started a new –passive- position in the company with 3.4 million shares, which represent 5.7 percent of the total shares outstanding, the stock fell 3.63 percent over the day.

Also betting on Pernix is the Athyrium Opportunities Fund, which has been consistently boosting its exposure to the pharmaceutical company over the past couple of months. According to its latest filing, its activist stake comprised 4,917,221 shares as of late-June.

Finally, there’s a micro-cap bank holding company: Community Bankers Trust Corp. (NASDAQ: ESXB).

The owner of Essex Bank saw Emanuel J. Friedman’s EJF Capital increase its wage by 53.6 percent recently, to 1,628,288 shares, or 7.5 percent of the outstanding stock – according to a 13G filed Thursday.

Shares of Community Bankers rose 1.4 percent on Thursday trading.

Friday, July 3, 2015 - 9:33am

Shares of Insys Therapeutics Inc (NASDAQ: INSY) are up 1.41 percent in after-hours, following a pretty much flat day. No particular news seems to have triggered the surge; in fact, it looks like an overall positive sentiment in relation to the stock is driving the rise. The specialty pharma company has managed to widely outperform the market year-to-date, having returned about 68 percent, versus the Nasdaq’s 5.74 percent surge.

Affymetrix, Inc. (NASDAQ: AFFX) continues to tumble after the bell. Following a 1.7 percent fall during the trading day, the stock is down an extra 1.73 percent in after-hours – on low volume, though. Thursday’s decline comes after Zacks downgraded the stock on Wednesday, from a “Strong Buy” rating to a “Hold” rating.

Also on the move late-Thursday is Inc (NASDAQ: SOHU), which lost 0.31 percent since the bell rang, after gaining 1.46 percent over the day. The Chinese gaming company’s stock is currently trading at $58.55. Once again, no particular events seem to be moving the stock, but volume is considerable for after-hours trading.

The Western Union Company (NYSE: WU), which fell 6.87 percent during the day, following PayPal’s acquisition of competitor Xoom Corp (NASDAQ: XOOM) and the resulting downgrade of Western Union’s stock by Evercore Partners. However, the transaction and payments services company’s stock is recuperating in after-hours trading, having surged 1.25 percent already.

Year-to-date, Western Union has managed to return 6.03 percent, versus the S&P 500’s 0.84 percent surge.

Friday, July 3, 2015 - 6:47am

Aetna (NYSE: AET) and Humana Inc. (NYSE: HUM) today announced that they
have entered into a definitive agreement under which Aetna will acquire
all outstanding shares of Humana for a combination of cash and stock
valued at $37 billion or approximately $230 per Humana share based on
the closing price of Aetna common shares on July 2, 2015.

The complementary combination brings together Humana's growing Medicare
Advantage business with Aetna's diversified portfolio and commercial
capabilities to create a company serving the most seniors in the
Medicare Advantage program and the second-largest managed care company
in the United States. The combined entity will help drive better value
and higher-quality health care by reducing administrative costs,

See full press release