US HOT STOCKS: CardioNet, Orexigen, Isle of Capri, Sprint

28th Jun 2010 18:29

U.S. stocks traded higher Monday as the Dow Jones Industrial Average gained 15 points to 10158, the Standard & Poor's 500 rose 0.6 point to 1077 and the Nasdaq Composite climbed 3.4 points to 2227. Among the companies whose shares are actively trading in the session are CardioNet Inc. (BEAT), Orexigen Therapeutics Inc. (OREX) and Isle of Capri Casinos Inc. (ISLE). CardioNet ($6.42, -$0.77, -10.65%), which makes systems that monitor heart rhythm disorders for people on an outpatient basis, said it was "disappointed" in a decision by the federal agency that administers Medicare and Medicaid to keep the reimbursement rates on some of its technology as carrier-priced for next year. Orexigen Therapeutics ($4.71, +$0.56, +13.49%) presented data on its lead experimental weight-loss drug that grabbed the attention of investors, sending the stock up as much as 16%, coming off its lowest levels in 12 months. The drug, Contrave, helped diabetes patients lose weight and control their blood sugar better than a placebo, according to data presented late Friday at the annual meeting of the American Diabetes Association. The findings aren't especially surprising, but they are reminding investors that Contrave is an effective drug with a large market potential. Isle of Capri Casinos Inc. (ISLE, $10.89, -$1.52, -12.25%) announced plans to sell at least 9 million shares, using proceeds to pay down the $80 million drawn from a credit line to fund its purchase of the Rainbow casino earlier this month from Bally Technologies Inc. (BYI, $35.14, -$0.74, -2.06%). Best Buy Inc. (BBY, $35.40, +$0.24, +0.68%) is rolling out its own mobile broadband Internet service as the largest U.S. specialty electronics retailer continues to add store-branded services for the products it sells. Engadget.com first reported the service, which the website said is likely to be provided by Sprint Nextel Corp. (S, $4.48, +$0.28, +6.55%) and will work with 4G. Citing an item on the retailer's intranet, Engadget said the service, called Connect, will launch July 11 in all but 75 of the company's stores. BP PLC (BP, $27.59, +$0.57, +2.11%) shares rose as fears subsided that a tropical storm would disrupt the cleanup operation, but that good news was tempered by a sharp increase in the company's daily rate of spending on Gulf of Mexico operations to $100 million. Big Tobacco stocks were seeing some relief after the Supreme Court refused to review a landmark ruling that found the industry violated federal racketeering laws. A Morningstar analyst said the market tends to price in the risk of defeat in cases like this and investors are relieved tobacco companies won't have to forfeit up to $280 billion in profits. The analyst said he can't imagine a court would let Big Tobacco off the hook financially, but looks like it won't be the maximum requested by government. Altria Group Inc. (MO, $20.40, +$0.70, +3.53%), Reynolds American Inc. (RAI, $53.97, +$2.60, +5.06%) and Lorillard Inc. (LO, $74.12, +$2.35, +3.27%) all rose. Other Stocks In Focus: Aflac Inc. (AFL, $44.91, +$1.32, +3.03%) said it will post an $80 million gain but the insurer will also take a $67 million charge in the current quarter on deals involving so-called perpetual securities and the sale of all its Greek sovereign debt, respectively. Citing "pending" moves by Apple Inc. (AAPL, $267.40, +$0.70, +0.26%) and Google Inc. (GOOG, $473.11, +$0.43, +0.09%), Susquehanna cut its rating on Amazon.com Inc. (AMZN, $117.70, -$3.30, -2.73%) to neutral from buy. The firm said that "rising competition is raising the uncertainty regarding eReader, eBook, and Book profit growth rates, capping the contribution to AMZN's valuation from these sectors. Thus, we are less confident in the multiple expansion we previously forecast." Arena Pharmaceuticals Inc. (ARNA, $3.32, +$0.08, +2.47%) said data from a Phase 3 trial of lorcaserin showed the weight-loss drug reduced body weight in all patient subgroups and showed greater improvements in cardiovascular risk factors compared to a placebo. Baldor Electric Co. (BEZ, $38.42, +$0.78, +2.07%), a producer of electric motors and power transmissions, will benefit from improving business and the switch to higher efficiency motors, says Canaccord, in upgrading to buy from hold. The firm said margins have the potential to increase further in 2010 and 2011, as sales volume increases and increasingly shifts toward the higher-priced efficiency motors. Bucyrus International Inc. (BUCY, $51.52, -$1.67, -3.14%) said it may lose a $310 million order for mining machinery from a subsidiary of Reliance Power Ltd. (532939.BY) of India because of a decision by the U.S. Export-Import Bank against providing loan guarantees for the project. The decision is equivalent to "throwing 1,000 jobs in the ditch," Tim Sullivan, chief executive of the maker of mining equipment, said in an interview with The Wall Street Journal on Friday. Bucyrus has estimated that the order would create or protect 984 jobs in 13 U.S. states. Cabot Oil & Gas Corp. (COG, $33.78, +$0.85, +2.58%) said a new well for natural gas from its shale gas lands was very positive. The oil and natural gas producer's total production is now about 375 million cubic feet per day, above its daily published guidance levels for the second half of the year, which it will evaluate and update on the second-quarter call. (MORE TO FOLLOW) Dow Jones Newswires June 28, 2010 13:29 ET (17:29 GMT)