Why Chelsea Therapeutics, Datalink, and Amarin Are Today's 3 Best Stocks

The S&P 500 climbs to its first record high of 2014, while Chelsea Therapeutics, Datalink, and Amarin all soar at least 15%!

Jan 15, 2014 at 5:15PM

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.

Don't call it a comeback, but following a multi-week low in the broad-based S&P 500 (SNPINDEX:^GSPC) earlier this week, the iconic index roared higher for a second straight day on the heels of positive economic data to close at another all-time closing high.

Pushing the S&P 500 decisively higher today was positive data from the Mortgage Brokers Association, as well as the release of the December Producer Price Index report.

The weekly MBA report on loan originations showed a robust increase of 11.9%, which follows a gain in loan originations of 2.6% in the prior week. If consumers finally understand that lending rates are still historically low by all measures even though rates have moved higher than their May 2013 lows,  then the housing and mortgage service sector could still have life.

Similarly, the December PPI, a monthly measure that aggregates costs from nearly all goods-producing sectors and some 25,000 establishments, showed an increase of 0.4%, which compares to a contraction of 0.1% in November, and market expectations of a jump of 0.2% to 0.4%, depending on the source. While higher costs for businesses are rarely a good thing, this cost inflation is often a sign that economic times are strong, and could give businesses ample reason to boost organic growth by passing along price hikes to consumers.

By day's end, the S&P 500 had advanced by 9.50 points (0.52%) to close at 1,848.38, the S&P 500's first new record high of the year.

Leading all companies to the upside today is small-cap clinical-stage biopharmaceutical company Chelsea Therapeutics (NASDAQ:CHTP), which rocketed 91.7% higher after announcing a positive recommendation from the Food and Drug Administration's advisory panel with regard to Northera, a drug designed to reduce dizziness in patients with Parkinson's disease. The FDA's panel voted 16-1 in favor of recommending Northera for approval, which is a bit of a surprise given that the FDA had previously rejected Northera because of long-term efficacy concerns. The vote is even more baffling considering that the FDA advisory panel's briefing documents on Friday alluded to a complex decision at hand. While Chelsea shareholders should certainly be thrilled with today's decision, I would reserve my optimism for a later date as the FDA isn't required to listen to the advice of its panel, and Northera's long-term efficacy could still come into question.

Data center solutions provider Datalink (NASDAQ:DTLK) saw its shares soar 37.6% after it updated its fourth-quarter sales and EPS guidance after the bell last night. According to the company, it now anticipates reporting revenue of approximately $174 million for the quarter, up from its own previous guidance of $160 million to $170 million, and the current consensus estimate of $167 million. In addition, it upped its EPS guidance to a fresh range of $0.33-$0.37 from its prior guidance of $0.24-$0.30, and Wall Street's estimate of $0.25. Although no commentary was provided with the release, it's clear evidence that spending on big data centers and cloud-based software is only increasing, potentially positioning Datalink for years of strong growth.

Finally, small-cap biopharmaceutical company Amarin (NASDAQ:AMRN), which is focused on developing therapies to improve cardiovascular health, gained 15.9% in anticipation of a decision by the Division of Metabolism and Endocrinology Products (DMEP) with regard to its special protocol assessment for Vascepa. In October 2013, DMEP rescinded the SPA for the Anchor trial, but DMEP had set Jan. 15 as the date by which it would make its determination on a reinstatement or not. After the bell, however, Amarin released news that its reinstatement request had been indefinitely delayed. Given the likely need to run lengthy safety trials to appease the FDA with regard to expanded Vascepa usage, I would keep my nose clear of Amarin following today's move higher.

These gains are impressive, but they might be peanuts compared to our top stock for 2014!
There's a huge difference between a good stock, and a stock that can make you rich. The Motley Fool's chief investment officer has selected his No. 1 stock for 2014, and it's one of those stocks that could make you rich. You can find out which stock it is in the special free report: "The Motley Fool's Top Stock for 2014." Just click here to access the report and find out the name of this under-the-radar 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.

Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

1 Key Step to Get Rich

Our mission at The Motley Fool is to help the world invest better. Whether that’s helping people overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we can help.

Feb 1, 2016 at 4:54PM

To be perfectly clear, this is not a get-rich action that my Foolish colleagues and I came up with. But we wouldn't argue with the approach.

A 2015 Business Insider article titled, "11 websites to bookmark if you want to get rich" rated The Motley Fool as the #1 place online to get smarter about investing.

"The Motley Fool aims to build a strong investment community, which it does by providing a variety of resources: the website, books, a newspaper column, a radio [show], and [newsletters]," wrote (the clearly insightful and talented) money reporter Kathleen Elkins. "This site has something for every type of investor, from basic lessons for beginners to investing commentary on mutual funds, stock sectors, and value for the more advanced."

Our mission at The Motley Fool is to help the world invest better, so it's nice to receive that kind of recognition. It lets us know we're doing our job.

Whether that's helping the entirely uninitiated overcome their fear of stocks all the way to offering clear and successful guidance on complicated-sounding options trades, we want to provide our readers with a boost to the next step on their journey to financial independence.

Articles and beyond

As Business Insider wrote, there are a number of resources available from the Fool for investors of all levels and styles.

In addition to the dozens of free articles we publish every day on our website, I want to highlight two must-see spots in your tour of fool.com.

For the beginning investor

Investing can seem like a Big Deal to those who have yet to buy their first stock. Many investment professionals try to infuse the conversation with jargon in order to deter individual investors from tackling it on their own (and to justify their often sky-high fees).

But the individual investor can beat the market. The real secret to investing is that it doesn't take tons of money, endless hours, or super-secret formulas that only experts possess.

That's why we created a best-selling guide that walks investors-to-be through everything they need to know to get started. And because we're so dedicated to our mission, we've made that available for free.

If you're just starting out (or want to help out someone who is), go to www.fool.com/beginners, drop in your email address, and you'll be able to instantly access the quick-read guide ... for free.

For the listener

Whether it's on the stationary exercise bike or during my daily commute, I spend a lot of time going nowhere. But I've found a way to make that time benefit me.

The Motley Fool offers five podcasts that I refer to as "binge-worthy financial information."

Motley Fool Money features a team of our analysts discussing the week's top business and investing stories, interviews, and an inside look at the stocks on our radar. It's also featured on several dozen radio stations across the country.

The hosts of Motley Fool Answers challenge the conventional wisdom on life's biggest financial issues to reveal what you really need to know to make smart money moves.

David Gardner, co-founder of The Motley Fool, is among the most respected and trusted sources on investing. And he's the host of Rule Breaker Investing, in which he shares his insights into today's most innovative and disruptive companies ... and how to profit from them.

Market Foolery is our daily look at stocks in the news, as well as the top business and investing stories.

And Industry Focus offers a deeper dive into a specific industry and the stories making headlines. Healthcare, technology, energy, consumer goods, and other industries take turns in the spotlight.

They're all informative, entertaining, and eminently listenable ... and I don't say that simply because the hosts all sit within a Nerf-gun shot of my desk. Rule Breaker Investing and Answers contain timeless advice, so you might want to go back to the beginning with those. The other three take their cues from the market, so you'll want to listen to the most recent first. All are available at www.fool.com/podcasts.

But wait, there's more

The book and the podcasts – both free ... both awesome – also come with an ongoing benefit. If you download the book, or if you enter your email address in the magical box at the podcasts page, you'll get ongoing market coverage sent straight to your inbox.

Investor Insights is valuable and enjoyable coverage of everything from macroeconomic events to investing strategies to our analyst's travels around the world to find the next big thing. Also free.

Get the book. Listen to a podcast. Sign up for Investor Insights. I'm not saying that any of those things will make you rich ... but Business Insider seems to think so.

Compare Brokers