Monday, March 8, 2010

DryShips… Rumors of a Rumor (DRYS)

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DryShips, Inc. (NASDAQ: DRYS) has seen more than its fair share of trading today.  The afternoon chatter is ‘buyout rumors’ but these sound more like BS than real meat. ran the buyout rumor piece today, and we have seen Indie Research cover the rumor and then Barron’s cover it in all but an outright dismissal.  The Barron’s note is calling it chatter at best.

With 30 minutes to close, DryShips is up 7.7% at $6.10 on over 55 million shares.  We have also seen more than 70,000 MAR-2010 CALLS trade hands today, which is another 7+ million shares of trading equivalent on a fully leveraged basis.

Anything in the world of M&A is possible, particularly if you can get management or large holders to go along with it.  But there are rumors, and then there are ‘rumors of a rumor’….. This sounds more like the latter, at best.


China Armco Staying Volatile (CNAM)

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China Armco Metals, Inc. (NASDAQ: CNAM) is still seeing elevated stock trading.  Due to a recent bump up, its average share volume is 426,000 shares.  But that was lower before the volume and prices shot through the roof last week. And today we are still very active with a 4.6% gain to $10.04. Here are last week’s big moves:
DATE  Shares Traded Close
5-Mar  7,633,600. $9.60
4-Mar  7,119,800. $8.50
3-Mar  685,200… $5.30

The 52-week trading range was moved higher as shares hit a high of $11.10 on Friday.  Today’s intraday high was $10.75.  Because this stock is sometimes included in with the ‘rare earth’ stocks and is small cap and in China, we are not even going to try bothering to note that its high has not been violated nor that it might not hold.  With a $100 million market cap, any contract can greatly influence the shares.  That is what caused last week’s run.


Top Day Trader Alerts (AIG, CTIC, MDVN, SEED, SSTI, XRTX, ZANE)

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These are this Monday’s top day trader and active trader alerts seen in pre-market trading.  We have included the news and some brief color where applicable on each.

American International Group, Inc. (NYSE: AIG) is trading up 2% after its $15.5 billion Alico sale to MetLife (MET).  The deal is similar to last week’s Asian sale in that it is divided between cash and stock.  At 8:23 AM EST we have seen 375,000 shares trade hands and the stock is up 2.4% at $28.75.

Cell Therapeutics, Inc. (NASDAQ: CTIC) rose on Friday and shares are up again on Monday after the FDA approved NerPharMa to manufacture Cell Therapeutics’ drug Pixantrone.  At 8:31 AM EST shares are up 15% more at $1.03 on almost 3 million shares.

Medivation, Inc. (NASDAQ: MDVN) is trading lower…. The beating will continue until morale improves.  There is trader speculation that the company should have known its recent drug failure was coming. Shares closed at $12.13 Friday and we have shared down another 3% at $11.75 on about 16,074 shares.

Origin Agritech Limited (NASDAQ: SEED) is up after it announced it has developed a strategic pesticide business unit for premium branded chemical products and it expects a premium branded glyphosate product to be marketed immediately into the domestic agricultural market for the 2010 selling season.  At 8:24 AM EST we have shares up 12.1% at $11.58 on 125,000 shares in the pre-market.

Silicon Storage Technology, Inc. (NASDAQ: SSTI) is trading lower after Microchip Technology Incorporated (NASDAQ: MCHP) entered into a second amendment to its February 2, 2010 definitive agreement to acquire SST and shareholders would be entitled to receive $3.05 per share in cash compared to $3.00 per share prior to the second amendment. This second amendment was in response to an offer made by another party to SST’s Strategic Committee on March 2, 2010.  SST shares are down almost 6% at $3.06 on 21,000 shares after closing at $3.25 on Friday.  There had been hopes of a higher buyout here.

Xyratex Ltd. (NASDAQ: XRTX) is trading higher on raised guidance: $313 to $318 million in revenue versus prior guidance of $245 to $285 million; GAAP earnings of $0.77 to $0.87 EPS versus prior $0.24 to $0.52 EPS guidance.  At 8:23 AM EST we have seen a 17.4% gain to $18.00 pre-market on about 24,000 shares of stock.

Zanett Inc. (NASDAQ: ZANE) was indicated lower this morning after Thursday and Friday’s exponential gains before the stock came way back down  This stock was up almost tenfold at one point but at 8:30 AM EST we have seen 20,000 shares trade hands and the stock is down 1.5% at $1.90.  This is not huge volume compared to teh 8M shares each day last Thursday and Friday but the action will be elevated all week here.

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