Why Thompson Creek Metals, Tesla Motors, and Regeneron Pharmaceuticals Are Today's 3 Best Stocks

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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.

Following the broad-based S&P 500's (SNPINDEX: ^GSPC  ) worst tumble in weeks is one of the strongest gains the index has delivered in nearly the same amount of time.

Pushing the S&P 500 higher today is significantly stronger-than-expected U.S. retail sales data, especially when auto sales are excluded. According to this morning's reports, retail sales excluding autos increased by 0.7% in December, which was much higher than the broad-ranging estimate calling for a decline of 0.1% to a gain of 0.4% -- and it certainly left November's 0.1% gain in the dust. Although consumers clearly weren't buying as many cars in December, the prospect that other retail sales improved appears to be a distinct possibility.

Between this strong data and a select group of preliminary earnings reports, the S&P 500 managed to trek higher by 19.68 points (1.08%) to close at 1,838.88.

Leading all stocks to the upside today – and certainly putting a grin on my face as my largest portfolio holding -- is Thompson Creek Metals (NYSE: TC  ) which gained 17.8% after announcing its fourth-quarter and 2013 production and sales results and updating its production outlook. Thompson Creek noted that concentrate production at its recently commission copper and gold mine, Mt. Milligan, produced 10.9 million pounds of copper, 21,100 ounces of gold, and 41,800 ounces of copper through Dec. 31. In addition, molybdenum production from its two active mines jumped 34% from the year-ago period to 30 million pounds. Thompson Creek's management also notes that commercial production of Mt. Milligan – defined as operating at 60% production capacity for 30 days – will occur in the first quarter. An upgrade from Bank of America/Merrill Lynch to "neutral" from "underperform" with a fresh price target of $7 added icing on the cake. In other words, Mt. Milligan, despite its higher-than-expected costs, remains on track and, metal prices willing, could deliver surprisingly strong results this year.

Adding some irony to my cheers is my lone short position, Tesla Motors (NASDAQ: TSLA  ) , which advanced 15.7% after announcing mixed news involving its fourth-quarter deliveries and a Model S recall. On the downside, Tesla released a statement that it plans to recall 29,222 Model S sedans to upgrade the car's charger on overheating fears. However, shares exploded higher after the company also commented that its fourth-quarter deliveries would hit 6,900 vehicles, well ahead of its previous estimates of slightly less than 6,000 vehicles. This figure will put Tesla's revenue estimates well ahead of Wall Street's. On the heels of this news, R.W. Baird upped its price target on Tesla to $187 and raised the stock to outperform. As for me, I will remain short given the ridiculous premium-per-car valuation being divvied out to Tesla in the face of a still small manufacturing effort and a general lack of supportive EV infrastructure.

Finally, biopharmaceutical giant Regeneron Pharmaceuticals (NASDAQ: REGN  ) galloped higher by 11.8% after its CEO noted at the JPMorgan Healthcare Conference that sales of Eylea will top $400 million in the U.S. in the fourth quarter. That represents less than 10% growth from the sequential quarter, but it's still well ahead of expectations and points to Eylea's dominance in treating wet age-related macular degeneration, as well as for its overseas potential. In addition, Regeneron also announced a joint development with Bayer (NASDAQOTH: BAYRY  ) -- its partner on Eylea -- of another treatment option for wet-AMD, a PDGFR-beta antibody. This new compound comes with an upfront $25.5 million payment to Regeneron and could give Regeneron the ability to earn $40 million in option and milestone payments. Although Regeneron's forward P/E over 50 is still very frothy, the simple fact that Eylea remains so dominant, especially with overseas growth still in its infancy, gives me reason to believe it could hold $300.

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Read/Post Comments (6) | Recommend This Article (2)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On January 14, 2014, at 5:28 PM, TurbulentTime wrote:

    No other car manufacturers can download software updates over the air and fix any problem except Tesla Motors. You can call it a recall whenever you like, 'cause it is not my problem, it is yours.

  • Report this Comment On January 14, 2014, at 5:29 PM, TurbulentTime wrote:

    Disclosure: I love to examine stocks which are heavily shorted. I love to see if shortsellers are wrong. In cases where they are very wrong, the profits are unimaginable.

  • Report this Comment On January 14, 2014, at 5:36 PM, jetamerica wrote:

    Sean: Like you I am short and this is why!

    Ford sold about 6.2 million vehicles worldwide 2013-TSLA, maybe 23,000 and maybe 41,000 in 2014. Ford market cap is $64.5 Bil with sales of $180 Bil. or 0.33% of annual sales. TSLA market cap of $20 bil. with TTM sales of $1.7 Bil. or almost 12 times annual sales. Ford makes about $6 billion in after tax profits and TSLA loses about $140 million. It may be worth a premium over Ford-perhaps a market cap of 1 times sales, not close to 12. That is still triple Ford.

    Round it up and that is a $2 billion market cap and a $26 stock price.

    I am hoping to see TSLA stock hit $170 to add to my short position. I think it is a good company and may be worth least $40 a share by 2019 if they execute perfectly and grow at least 50% anually with profits for the next 5 years. Current share price is nuts.

    They are way ahead of themselves and the hype is what is keeping the stock up .Average Ford vehicle sells for for about $30,000 not $80,000-greater appeal to a larger share of the market.

  • Report this Comment On January 14, 2014, at 6:22 PM, mdk wrote:

    I agree 100%, way hyped stock

    Musk first blamed house wiring for fire problems then sent out new charging adapters to fix it. He did not answer the question directly asked about fire caused by charger.

    He gives lower estimate on delivery In the middle of quarter in order to beat his own estimate, an old trick.

  • Report this Comment On January 14, 2014, at 7:01 PM, rmurrey2 wrote:

    Sounds like sour grapes to me! The S model car is not like any other car in the market. One cannot compare Tesla Motors to other car manufacturers on sales only. Continue to short the stock and lose your shirt. We have done outstanding on this stock and keep making more money. There is no recall of the cars. A new adapter is being mailed to owners of the S model. It is by far the safest car in the market!

  • Report this Comment On January 15, 2014, at 12:06 AM, rafarules wrote:

    Hang in there Sean - practice prudent risk management. The Tesla loonies took me for a similar ride several months ago and I threw in the towel swearing off shorting the madness exhibited by a market inflated beyond comprehension by the flood of paper in the system that hasn't made its way to the intended target of the masses but rather into the hands of those who are doing well....those who have no where else to park these funds except into stock or real estate given the likelihood of rising interest rates (and thus avoiding the traditional investment of the wealthy - bonds). After all you can only eat and drink so much.

    Appropriate valuations will come eventually, but who knows when. The bubbles of 2000, 2008, 1929, 1973, 1600's (tulip bulbs), 1700s (exploration of the americas) etc.etc. showed us things can get really ridiculous before the madness of crowds swing in the opposite direction.

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Sean Williams

A Fool since 2010, and a graduate from UC San Diego with a B.A. in Economics, Sean specializes in the healthcare sector and in investment planning topics. You'll usually find him writing about Obamacare, marijuana, developing drugs, diagnostics, and medical devices, Social Security, taxes, or any number of other macroeconomic issues.

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