Why Zogenix, ImmunoGen, and voxeljet Are Today's 3 Best Stocks

The Beige Book release and key economic data pumps up the S&P 500 while Zogenix, ImmunoGen, and voxeljet lead individual stocks to the upside.

Apr 16, 2014 at 5:15PM

If you haven't noticed, earnings season is starting to kick into full swing, and investors apparently like what they're seeing thus far, with the broad-based S&P 500 (SNPINDEX:^GSPC) surging to its third consecutive gain.

In addition to a number of positive earnings reports which pushed the market higher, we were dealt a handful of economic data – some good, some bad.


First off, it was a big day for housing industry data, with the March report on housing starts and build permits. The good news was the nearly 3% rise in housing starts for March to a seasonally adjusted rate of 946,000. On the flipside, building permits in March fell to an annual pace of 990,000 units, which is down from the 1,014,000 reported in February. In other words, the homebuilding and construction sector continues to be very unpredictable.

We also received the weekly loan originations update from the Mortgage Brokers Association which showed a 4.3% increase from the previous week. This is definitely a good sign for mortgage servicers and the housing sector in general, but putting things into perspective loan originations (refinancing and new mortgage originations) are way down from their May 2013 peak.

We also had the release of March's industrial production data which showed an expansion of 0.7%. Although this was down from the 1.2% expansion in February, it's still an encouraging sign that the manufacturing sector is expanding.

But, perhaps the biggest catalyst was the release of the Fed's Beige Book which confirmed that the weather and not some endemic slowdown in corporate growth was the reason behind the early quarter growth slump.

By days end the S&P 500 had decisively risen by 19.33 points (1.05%) to close at 1,862.31. The index has now erased more than half of its week-and-a-half long swoon lower.

Topping the charts and leading all companies to the upside is small-cap biopharmaceutical company Zogenix (NASDAQ:ZGNX) which roared higher by 20.5% after announcing a Massachusetts U.S. District Court decision that will prevent the implantation of a ban on the company's severe pain medication Zohydro ER. In late March Massachusetts' Gov. Deval Patrick banned Zohydro ER on fears that the therapy would be abused, but today's ruling made sure to set a precedent that states can't simply pick and choose what drugs can and cannot be sold. While it's certainly a positive for Zogenix, ongoing concerns about its abuse potential could make it a potentially risky bet for investors.

Sticking within the biotech sector, shares of ImmunoGen (NASDAQ:IMGN) soared 11% after research firm Canaccord Genuity initiated coverage on the company with a "buy" rating and a $20 price target, which represents better than 55% upside to yesterday's close. The catalyst for Canaccord's coverage is expected positive results from a phase 3 trial involving antibody-drug conjugate Kadcyla, which is being developed in collaboration with Roche (NASDAQOTH:RHHBY), for HER2-positive metastatic breast cancer. The results should be out in the latter half of this year and Canaccord sees a greater than $7 billion opportunity for adjuvant breast cancer therapies like Kadcyla. While I'm always leery of putting too much weight (if any) behind analyst ratings, this is one where I happen to agree in full. ImmunoGen has a diverse pipeline and a number of key partnerships which may give it an above average chance at long-term success.

Finally, 3-D printer developer and on-demand parts service company voxeljet (NYSE:VJET) advanced by 9.3% after announcing the closing of its share offering of 3 million ADS shares at $15 per share.

VXC800 continuous printer. Source: voxeljet. 

Voxeljet had already taken a beating by pricing these shares well below its closing price last week when the offering was announced, so today's move higher appears to signify confidence in the $41.4 million in gross proceeds raised, as well as the elation of putting this dilutive offering in the rearview mirror. While voxeljet's top-line growth has the chance to outpace its industry peers (primarily because of its small size), the quarterly losses are expected to continue for some time which puts me off of wanting to have anything to do with this stock.

Zogenix, ImmunoGen, and voxeljet all soared today, but they may have a difficult time keeping pace with this top stock in 2014
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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.

The Motley Fool recommends ImmunoGen. Try any of our Foolish newsletter services free for 30 days. 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.

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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