Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of clinical stage biotechnology company Infinity Pharmaceuticals (NASDAQ:INFI) soared as much as 17% after Morgan Stanley initiated coverage on the company.

So what: Morgan Stanley initiated Infinity Pharmaceuticals with an "overweight" rating and a price target of $47 on high hopes for one of its leading drug candidates, IPI-145, which is designed to treat multiple hematological malignancies. Morgan Stanley noted that the company's positive early stage results and wide potential reach of IPI-145 could translate to a multi-billion dollar platform.

Now what: Personally, my advice would be for Morgan Stanley to come down from cloud nine. As usual, I'd take any analyst upgrades, downgrades, and initiations with a grain of salt because they have very little long-term effect on a stock's share price. What's really important here is IPI-145. Yes, it showed plenty of promise in phase 1 trials... but let's keep in mind as well that these were merely, phase 1 trials! We really haven't dug into the basics of efficacy or safety yet, and that'll more than likely come later this year when we have some phase 2 results to examine. In the meantime, Infinity's shares have catapulted around 570% over the trailing 12 months on those high hopes. I feel a sizable pullback may be in order and am keeping my CAPScall of underperform squarely in place.

Craving more input? Start by adding Infinity Pharmaceuticals to your free and personalized Watchlist so you can keep up on the latest news with the company.

Fool contributor Sean Williams has no material interest in any companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong.

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