Monday, December 6, 1999
The sizzle of hot stocks
By Eric Pierce
& Shaun Brown
A report in Nature that researchers have sequenced the largest contiguous segment of DNA to date sent investors scrambling for shares of genomics companies. Although the report adds little to the commercial implications of genomics, the buying frenzy added nearly $936.6 million to seven genomics stocks on Thursday. CuraGen (CRGN), Gene Logic (GLGC), Incyte (INCY) and Celera (CRA) - posted double-digit percentage gains (see "Tickling Investor Fancy").
The genomics group has traded up significantly since the percolation began in mid-September, when several analysts upped their ratings on bellwether Human Genome Sciences (see Ebb & Flow, Sept. 13). Since then, both HGSI and Millennium (MLNM) have run from the mid $70s to well above $100 per share. MLNM closed Friday at $106.50, while HGSI closed at $129.313. MYGN has more than doubled since mid-September from $14 to $35.
CRA already had jumped $11.687 (26 percent) to $56 on Thanksgiving week on news that it will provide Pfizer with isolated, full-length genes for small molecule discovery programs. Pfizer also took a five-year subscription to all of CRA's current database products. Similarly, INCY had gained $7.75 (34 percent) to $30.75 on Thanksgiving week after expanding a 1994 genomics deal with Pfizer (see B6).
The custom antibody group wasn't far behind the genomics crowd, as a CNBC interview with Abgenix (ABGX) CEO Scott Greer served as a momentum event for ABGX and other antibody developers Medarex (MEDX) and Protein Design Labs (PDLI). ABGX rose $17.50 to $77.625 on 1.1 million shares on Thursday as Greer discussed ABGX's deep XenoMouse partnerships. MEDX added $3.438 to $15.25 on 3.3 million shares on the day, and PDLI added $8.875 to $49.875 on 1.1 million shares.
ABGX, which announced antibody deals with HGSI and Chiron (CHIR), closed Friday at $78.50, up $26.75 (52 percent) on the week (see Noteworthy, A5). MEDX was up $6.063 (54 percent) to $17.25 on the week, while and PDLI closed Friday at $48.438, up $7.75 (19 percent) on the week.