September has historically been a difficult month for stock market investors, but major market benchmarks looked poised to gain ground on Tuesday morning. The Nasdaq Composite (^IXIC +0.83%) opened higher by about half a percent, and other stock indexes showed similar gains heading into the regular trading session.
A couple of stocks saw outsize gains entering the new week. Home security specialist ADT (ADT 0.15%) announced a new partnership that could potentially transform its business. Meanwhile, investors in tiny biotech company Iveric Bio (ISEE +0.00%) got some great news that could build lasting momentum for its business. Read on to learn more about both companies and why everyone's talking about them to start the holiday-shortened week.
ADT makes a deal with State Farm, Alphabet
Shares of ADT opened higher by 14% Tuesday morning. The company's latest smart-home initiative looks like it's paying off.
ADT announced that privately held insurance giant State Farm would make a $1.2 billion equity investment in the home security specialist. That will result in State Farm owning about 15% of ADT's stock.
As part of the arrangement, ADT will partner with State Farm and expand on its existing relationship with Alphabet's Google to keep developing next-generation security and smart-home technology in an effort to mitigate risks.
NYSE: ADT
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Under the terms of the deal, State Farm will commit as much as $300 million in funding for new products and technology, as well as customer acquisition and marketing costs. Google will chip in another $150 million, doubling its previous commitment and also looking to capitalize on the opportunities in smart-home technology.
The collaboration is an interesting mix of technology, finance, and consumer services and shows some of the ways in which companies in seemingly different areas can work together for their common good.
Iveric gets a win
Elsewhere, shares of Iveric Bio jumped 37% in early trading Tuesday. The small biopharmaceutical company announced positive results in a clinical trial of a key candidate treatment under development.
New Jersey-based Iveric said that its second phase 3 trial of its Zimura C5 inhibitor met its primary endpoint in treating geographic atrophy, which is related to age-related macular degeneration in the eye. The treatment showed a statistically significant reduction in the rate of progression of the disease at the 12-month point, confirming an earlier trial's similarly favorable results.
NASDAQ: ISEE
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Based on the positive trial data, Iveric now expects to submit a New Drug Application with the U.S. Food and Drug Administration during the first quarter of 2023. Company leaders are optimistic about its prospects, touting its efficacy in slowing disease progression without many of the ocular adverse events that have plagued patients in this area.
Iveric's stock has seen considerable volatility in the past couple of years, as news about its treatment pipeline has vied against changing views among investors about high-growth, high-risk biopharmaceutical stocks more broadly. If Iveric's drug application with the FDA proves successful, however, it will mark an important milestone in the company's history and could be the beginning of a success story for shareholders.
