Why Furiex Pharmaceuticals, Lionbridge Technologies, and ATMI Are Today's 3 Best Stocks

The S&P 500 stages a modest rebound, Furiex Pharmaceuticals more than doubles, and Lionbridge Technology and ATMI respectively surge by 29% and 25%.

Feb 4, 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.

It was another day of generally poor economic data, but following yesterday's tumultuous drop in the S&P 500 (SNPINDEX:^GSPC) investors were willing to give the market a temporary reprieve.

Attempting to push the market lower was the release of December's factory order numbers which showed a decline of 1.5%, compared to November's expansion of 1.5%, due to a decline in aircraft orders. The good news, and the reason the market might be up today, was that excluding the weak transportation category new orders were actually up 0.2%.

Also helping push the S&P 500 higher today were a number of solid earnings reports, with upside surprises practically doubling downside surprises after the bell on Monday. Pessimists have honed in recently on weaker than expected top-line growth, so we'll certainly need to see an extension of these results throughout the remainder of earnings season if the S&P 500 is to continue heading higher.

By day's end, the S&P 500 had advanced by 13.31 points (0.76%) to close at 1,755.20, breaking a hefty two-day losing streak and bouncing nicely off its three-plus month lows.

Furiously leading the charge to the upside today was biopharmaceutical company Furiex Pharmaceuticals (UNKNOWN:FURX.DX), which ended higher by a "mere" 129.9% after rocketing higher by as much as 165% following the release of positive top-line data from two late-stage studies of its diarrhea-predominant irritable bowel syndrome drug, eluxadoline. According to Furiex, eluxadoline met its primary endpoint of simultaneously improving patients' stool while reducing abdominal pain. Although Furiex's 75 milligram dose failed to meet statistical significance, its 100 mg dose handily outperformed the placebo in trials. Furiex plans to file a new drug application for eluxadoline in the second quarter. While optimism is certainly warranted, I'd caution that the Food and Drug Administration's view of eluxadoline and a potential launch of the drug would have to be flawless for Furiex to maintain its current valuation.

Language, content, and testing software solutions provider Lionbridge Technologies (NASDAQ:LIOX) tacked on 29.4% after it reported better than expected fourth-quarter results. For the quarter, Lionbridge's revenue rose 12% to a record $127.5 million, as generally accepted accounting principles earnings per share improved to $0.10. By comparison, Wall Street expected just $0.05 in EPS on $121.7 million in revenue. Looking ahead, Lionbridge anticipates full-year revenue growth of 5% to 10%, perfectly bracketing the 7% that Wall Street has projected. Similar to Furiex, investors have every reason to be excited after today's news, but the stock move might be excessive given that Lionbridge is now valued at 25 times forward earnings and growing at between just 5% and 10%.

Finally, semiconductor materials company ATMI (NASDAQ:ATMI) popped 25.5% after announcing that it had agreed to a $1.15 billion buyout by rival Entegris (NASDAQ:ENTG). The deal itself values ATMI at $34 per share and will be funded in its entirety by cash. The reasoning behind the deal for Entegris is to reduce costs and leverage the combined entity to go after larger deals. The deal, though, shouldn't come as a huge surprise, as ATMI had hired Barclays to explore possible strategic alternatives for the company in November.

These three moves were truly impressive today -- but they may not be able to hold a candle to this top stock when 2014 is said and done
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.

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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4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

Click here to learn about this incredible technology before Buffett stops being scared and starts buying!

David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't 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.

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