The Dow Jones Industrial Average flashed a 60-point gain yesterday driven higher by the tech sector and its old dynamic duo, Microsoft (NASDAQ:MSFT) and Intel, the "Wintel" team from when PCs still ruled the world. They powered the index higher, each rising by more than 3% on no company-specific news.
Yet Mr. Softy, if no one else, is likely enjoying some instant karma as it joined a few other tech names in a lawsuit in Europe over Google's (NASDAQ:GOOGL) anti-competitive actions with its Android platform. Several years ago, Google had latched onto an anti-competitive European lawsuit against Microsoft for allegedly using its Internet Explorer for monopolistic purposes. I guess what goes around does come around.
I say a pox on both their houses since they're attempting to achieve in the courtroom what they were having difficulty winning in the marketplace. Of course, Europe is the perfect vehicle for that since governments there are more inclined to intervene in the markets, so companies use the EU as a cudgel to beat up their competitors.
The future's looking bright
Yet yesterday was solar's time to shine, as virtually every single name in the space seemingly rose by double-digit percentages. Leading the way higher was First Solar (NASDAQ:FSLR), which roared ahead 45% after saying it expected to earn a profit well ahead of analyst expectations and was somewhat supplementing its panel business by jumping feet first into competing technology. Color me skeptical on both accounts as I see investors getting burned buying into the hype.
The thin film panel maker is saying not only will 2013 be a great year, but next year and the year after will be, too. This is despite the fact that it couldn't effectively compete against traditional solar panel makers as an inventory glut drove down prices so it switched to a design-build firm taking on large solar array projects. Now it's going back to the future, jumping into the rooftop panel business again by buying TetraSun, a solar PV start-up, that will produce high-efficiency, low-cost panels. Seems it will be competing against itself as much as its rivals as the new technology stands in stark contrast to its thin film standard.
It was only last month that First Solar was struggling after missing fourth-quarter results and taking down guidance for the first quarter. There were still too many unknowns to issue full-year guidance -- wildcards that still exist -- yet now it's giving three years worth of forecasts and all are rosy.
I'd be wary since also coming along for the ride were other ne'er-do-well solar names like LDK Solar, Yingli Green Energy, and JA Solar, all running 20% higher or more on First Solar's outlook. Suntech Power surged 30% on the day, but that was after rumors arose that it was shopping itself to the highest bidder because it's in desperate need of cash. I just don't think solar's future is so bright we'll need to wear shades.
Hanging up on mobile growth
At least there was a firm basis for the 11% spike in Sarepta Therapeutics' (NASDAQ:SRPT) shares as study results from GlaxoSmithKline's (NYSE:GSK) drisapersen were published in a research abstract that suggests the path the two are taking is valid. Both drisapersen and Sarepta's eteplirsen seek to treat patients with Duchenne muscular dystrophy via an "exon skipping" mechanism, so if the one proves positive it holds out hope the other will too.
Genes are sections of DNA containing instructions for the production of one specific protein and are divided themselves into sections called exons and introns. When the introns are removed, the largest gene has 79 exons strung together, but sometimes one of them misses a beat and prevents it from being completed. The drugs from both Glaxo and Sarepta are designed to skip over exon 51 and bridge the gap with molecular patches that allow the gene to splice itself together to complete the sequencing.
Glaxo originally hadn't planned to reveal its results until later this year, but with Sarepta due to report its own test results in a few weeks Glaxo undoubtedly felt pressured to come forward early. Because Sarepta's testing was done with a relatively small sample size, it may not have been as well received, but now that Glaxo's larger patient universe seems to validate the method, Sarepta's own results, if equally positive, could also be considered sound.
There's a lot of "what ifs" and "by extensions of" at play here, but investors are counting on Sarepta now being able to bridge the gap itself.