Stocks in the News: Small Pharma Could Be a Big Buy

Posted: Sep 10, 2013 12:01 AM
Stocks in the News: Small Pharma Could Be a Big Buy

Stock number one is: 

Isis Pharmaceuticals Inc., (SYMBOL: ISIS) and the headline says: Biogen Expands Isis Partnership in $100 Million Drug Deal -- Bloomberg

Isis Pharmaceuticals will receive $100 million from Biogen Idec in a six-year agreement to develop treatments for neurological disorders, and up to $220 million thereafter for each new drug compound.  This marks the fourth recent collaboration between the companies, which is expected to bring new drugs to market annually beginning next year.

Isis is a small-cap aggressive growth company which typically takes a net loss every year.

The share price shot up to the low $30’s this summer, then corrected.  The stock could appeal to traders while it ranges between $28 and $34 in the near-term.

Our Ransom Note trendline says:  BUY ISIS PHARMACEUTICALS AT $28.

ISIS Chart

ISIS data by YCharts

Stock number two is: 

Crown Castle International Corp., (SYMBOL: CCI) and the headline says: S&P REITERATES STRONG BUY OPINION ON SHARES OF CROWN CASTLE – S&P

Crown Castle, operator of wireless towers and infrastructure, has begun the process of reorganizing as a Real Estate Investment Trust.  REIT’s typically pay substantial dividends to shareholders.  The company has not yet commented on future payouts, but S&P recently said, “We view the shares as highly attractive, given our expectations for strong free cash flow growth.”

The company became profitable in 2011, and generally expects rapid annual earnings growth.

The stock has been trading between $67 and $81 all year.  Crown Castle shares could appeal to growth & income investors and traders for the future dividend and the wide trading range.

Our Ransom Note trendline says..... ACCUMULATE CROWN CASTLE UNDER $72.

CCI Chart

CCI data by YCharts

Stock number three is:

Delta Air Lines Inc., (SYMBOL: DAL ) and the headline says: S&P SAYS DELTA AIR LINES TO JOIN S&P 500 -- Reuters

Delta Airlines will join the S&P 500 index after the close of business on September 10, replacing BMC Software.  BMC is being acquired by Bain Capital.

Delta’s earnings projections have increased since our July report, now expected to grow 48% in 2013.  The PE is 7.6.  The company is focusing on debt reduction; and return of capital via increased dividends and a $500 million share repurchase program.

The stock price is up 52% since we told investors to buy at $14 earlier this year.  The stock is on an uptrend, most recently trading between $19 and $22 since mid-July.

Our Ransom Note trendline says....  BUY DELTA AIR LINES.

DAL Chart

DAL data by YCharts

Stocks in the News is produced by Ransom Notes Radio and Goodfellow, LLC. Crista Huff manages Goodfellow LLC, a website that recommends outperforming stocks using fundamental and technical analysis.