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Ariad Pharmaceuticals (ARIA) Jumps on More Buyout Rumors

By  +Follow March 28, 2014 9:43AM
Tickers Mentioned:

Shares of small-cap pharma Ariad Pharmaceuticals (ARIA) were trading higher on Friday after rumors were started by British paper The Daily Mail that Jazz Pharmaceuticals (JAZZ) was interested in acquiring the company at $20 a share.

Ariad, already a company with a history of high-volume, volatile trading action has already been the subject of buyout rumors sparked by The Daily Mail, previously seeing shares climb in January after the paper reported that pharma giant Eli Lilly (LLY) was considering purchasing the company.

The article, which ran after the closing bell on Thursday, appears to be the impetus behind the nearly 8 percent gain in shares of Ariad on Friday morning. The stock gapped up 5.8 percent to $8.04 a share at the opening bell and gained from there, touching $8.20 a share at its peak.

However, given The Daily Mail’s previous whiff on a purported buyout, it’s clear that traders are taking this most-recent bit of rumor with a significant grain of salt. Given that the rumors cited a share price of $20, a nearly 165 percent premium on the trading price at Thursday’s closing bell, the relatively modest gain can’t be viewed as a ringing endorsement of the potential deal from Wall Street.

It’s also become par for the course for Ariad, a stock that has proven not to be for the faint-hearted investor over the last six months. The company nosedived on October 9 after the FDA placed a clinical hold on trials for ponatinib, its kinase inhibiting leukemia drug Iclusig, ultimately losing more than 75 percent of its value. In the following months, shares continued to swing wildly up and down on extremely heavy volume. However, looking past the interday volatility, Ariad has been making steady gains over the long term, and the FDA ultimately allowed the company to resume marketing and distributing Iclusig with new warnings about blood clots.

Earlier in the month, two trend lines appeared to converge as a falling resistance line that dated back to early September crossed a rising support level that formed in early November after the initial sell-off on Iclusig’s clinical hold. At first, it appeared as though the resistance level would win out, pushing shares below the support line that had largely been moving with the 20-day SMA.

Of course, the stock then began trading at very close to its 50-day SMA and crossed over the falling resistance line less than two weeks later. It’s currently trading in a relatively narrow corridor at close to $8.10 a share, with both the 20-day and 50-day SMAs very close to each other and shares trading very close to those levels.

Looking at a few other technical factors, the MACD line has very recently passed into positive territory, indicating that the current momentum could have real strength. However, the chart appears to show a stock that’s consolidating and waiting to be driven in one direction or the other by an external factor.

The fact that 9-day, 20-day, and 50-day moving averages are so close, and that current share prices remain close to each of those levels, would seem to point towards traders who aren’t seeing a lot of strong momentum, either bullish or bearish. Since falling off a cliff last year, the stock has rallied from a low of $2.15 to levels just over $8 a share. But throughout this rally, the stock pulled back any time its 14-day RSI hit 70, seeming to indicate many of those trading the stock are reticent of technical indicators.

That doesn’t mean there isn’t action, though. With an average daily volume of 14 million shares, about 7.5 percent of its float, over $110 million worth of Ariad stock is changing hands every day. It seems eminently possible that Ariad is poised to breakout in the relatively near future, it’s just unclear which direction that will be in.




DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions.

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Results for ARIA
23 Oct 14 11:12:42
$ARIA - here comes the rally! NEW HOD SOON #news #breakingnews #cnbc $lake #DallasEbola $shpg $cmrx $tkmr $ibio $bcrx $SRPT $NLNK #ZMapp
23 Oct 14 11:10:47
$ARIA $5.78 #news #breakingnews #cnbc $lake #DallasEbola $shpg $cmrx $tkmr $ibio $bcrx $SRPT $NLNK #ZMapp
23 Oct 14 11:05:51
$ARIA $5.77! #news #breakingnews #cnbc $lake #DallasEbola $shpg $cmrx $tkmr $ibio $bcrx $SRPT $NLNK #ZMapp
23 Oct 14 11:02:55
$ARIA moving up! Buyout possible? #shire? #news #breakingnews #cnbc $lake #DallasEbola $shpg $cmrx $tkmr $ibio $bcrx $SRPT $NLNK #ZMapp
23 Oct 14 11:00:40
$ARIA Why Ariad Pharmaceuticals, Inc. Stock Catapulted Higher http://t.co/3jz1yOq7Ho
23 Oct 14 10:56:29
$ARIA getting ready to break out!!! #news #breakingnews #cnbc $lake #DallasEbola $shpg $cmrx $tkmr $ibio $bcrx $SRPT $NLNK #ZMapp
Investors Hangout
23 Oct 14 10:50:31
jim50: $ARIA Volume Date=Oct-23-2014 Open=5.65 High=5.82 http://t.co/YphKpwpqmn
Investors Hangout
23 Oct 14 10:50:20
jim50: $ARIA Volume Date=Oct-23-2014 Open=5.65 High=5.82 http://t.co/pbM0iYcY3B
23 Oct 14 10:47:04
$ARIA Volume Date=Oct-23-2014 Open=5.65 High=5.82 Low=5.55 Close=5.78 Volume=1910077 http://t.co/e8pb8QZIVN
Victor Roberts, MD
23 Oct 14 10:18:33
@grdollasign i don't know ur trades, so was just guessing you may be hurt by $ARIA fall! It's holding 5s well, can go up big/fast! CHMP soon
Investors Hangout
23 Oct 14 10:13:28
chartguy89: EBAY Stock Chart $EBAY $VXX $TBT $ARIA http://t.co/dSb9pYV4cN
Investors Hangout
23 Oct 14 10:13:16
chartguy89: EBAY Stock Chart $EBAY $VXX $TBT $ARIA http://t.co/O1AuKOJBJB
Ross Anderson
23 Oct 14 10:10:00
@Drragu Actually, I am a sore winner. Made a killing in $ARIA but we should all be whining that the stock is stuck at $100 by now :)
23 Oct 14 09:59:49
EBAY Stock Chart $EBAY $VXX $TBT $ARIA http://t.co/3vUo3KjSy9 http://t.co/colWzHH2Fb
23 Oct 14 09:33:55
$ARIA rallying. #news #breakingnews #cnbc $lake #DallasEbola $shpg $cmrx $tkmr $ibio $bcrx $SRPT $NLNK #ZMapp
T Abuhasna
23 Oct 14 09:31:03
$ARIA $S $VPOR $$$$$
23 Oct 14 08:23:13
Update: $ARIA trading at +3.58% #stockaction #BiotechTraderHandbook--> http://t.co/JDdc1OTfZF
23 Oct 14 08:19:14
Our Penny Stock Picks Gained 371% In 2 Weeks! Get Our Next Pick Early: http://t.co/z2noBUWrEP $FASC $ARIA $TUCN
Investors Hangout
23 Oct 14 07:46:34
DennyT: ARIA Income Statement $ARIA $EEM $FXI $V $HGU.TO http://t.co/jJBR6mqvES
Investors Hangout
23 Oct 14 07:46:33
DennyT: HEMP Insider Disclosure $HEMP $VIPS $ARIA $UGAZ http://t.co/ksaiJBuDg3
Investors Hangout
23 Oct 14 07:46:33
DennyT: ARIA Income Statement $ARIA $EEM $FXI $V $HGU.TO http://t.co/kyHBr0qW1M
Investors Hangout
23 Oct 14 07:46:31
DennyT: HEMP Insider Disclosure $HEMP $VIPS $ARIA $UGAZ http://t.co/yQbbmLxrnb
23 Oct 14 07:35:32
$BABA Opinion Today Click here to find out if $BABA is a buy hold or sell. Watching these stocks. $ARIA $SUNE http://t.co/0J28l4UWyG
23 Oct 14 07:28:11
ARIA Income Statement $ARIA $EEM $FXI $V $HGU.TO Buy?,Stock Chart,Low,Company News,Alert Stock Quote http://ww http://t.co/U0OB499IS5
23 Oct 14 07:17:45
HEMP Insider Disclosure $HEMP $VIPS $ARIA $UGAZ $IYT Opinion Today,Volume,Low,Recent Headlines,keeping this on http://t.co/ku6C49ukL9
Kenneth Meyerson
23 Oct 14 06:44:38
RT @Drragu: $ARIA Still green on weekly chart! BB are pinching, big move coming soon! http://t.co/beCOFQQfSs
Penny Stock Secret
23 Oct 14 06:31:42
The Hottest Way to Make Millions From Stock Market.Click HERE http://t.co/SVqoMkrw2z .. $INSY $SIGI $ARIA
Richie Rich
23 Oct 14 06:05:43
RT @crhz1978: $ARIA $AVNR $KERX all rallying!!! #news #breakingnews #cnbc $lake #DallasEbola $shpg $cmrx $tkmr $ibio $bcrx $SRPT $NLNK …
Richie Rich
23 Oct 14 06:05:35
RT @optiontraderbot: Sector updates $ARIA at +1.21% #options #BiotechTraderHandbook--> http://t.co/QvDIRU65Zv
Richie Rich
23 Oct 14 06:04:51
RT @optiontraderbot: $ARIA Nasdaq stocks posting largest percentage increases http://t.co/3F6IwXoVBZ #BiotechTraderHandbook--> http://t.co/…
Richie Rich
23 Oct 14 06:04:07
RT @Drragu: $ARIA Still green on weekly chart! BB are pinching, big move coming soon! http://t.co/beCOFQQfSs
Victor Roberts, MD
22 Oct 14 20:55:08
@grdollasign look at RGLS , with one small Phase 1 good data , it's up by 100% over night! Where will $ARIA be w/AP26113 & other pipelines?
Victor Roberts, MD
22 Oct 14 20:36:12
@grdollasign less institutional ownership looks like good thing for $ARIA ! Less shares available to loan to short. short covering started!
Victor Roberts, MD
22 Oct 14 20:16:06
@grdollasign he is still $ARIA CEO! there's no public disagreement w/him being CEO, Yet! 70% Institutional ownership, they're Ok so far!
Ross Anderson
22 Oct 14 20:14:57
@Drragu Agreed..visionary. Irrelevant when you never know the truth. $ARIA will flourish when @harveyberger steps down or is forced out.
Victor Roberts, MD
22 Oct 14 20:11:16
@grdollasign u have to aways hedge your investment in a growing company like $ARIA. It's pipeline and drug development platform is visionary
Victor Roberts, MD
22 Oct 14 18:23:52
$ARIA Still green on weekly chart! BB are pinching, big move coming soon! http://t.co/beCOFQQfSs
22 Oct 14 16:26:14
http://t.co/OnhjJ9dsFO Verified $22.27 profit in $ARIA none
Ross Anderson
22 Oct 14 15:03:38
@harveyberger are you outta there yet? I want to get back in $ARIA but cant because you are killing the company. You cannot be trusted.
22 Oct 14 14:43:27
$ARIA good news more like a downgrade for ariad
22 Oct 14 14:29:45
Our Penny Stock Picks Gained 371% In 2 Weeks! Get Our Next Pick Early: http://t.co/z2noBUWrEP $FASC $ARIA $TUCN
22 Oct 14 14:24:14
ARIA 5.59 Stock Charts $ARIA Ariad Pharmaceuticals Inc. (NASDAQ) Last Updated: 10/22/2014 16:24:11 ARIA Stock http://t.co/xSW3g65LtD
22 Oct 14 14:14:11
$ADHD falling $ARIA footsteps- $ARIA went from $24 to $5 and when everyone was looking for a bounce it went to $2.15 and than rebounded!
22 Oct 14 13:11:49
$ARIA Nasdaq stocks posting largest percentage increases http://t.co/3F6IwXoVBZ #BiotechTraderHandbook--> http://t.co/JDdc1OTfZF
Stock Relay
22 Oct 14 13:07:36
stockblaster14: Stock Alerts: Ariad Pharmaceuticals (ARIA) 5.61 $ARIA Insider http://t.co/IKQEiU5iYw
22 Oct 14 13:03:37
Ariad Pharmaceuticals (ARIA) 5.61 $ARIA Insider Trading Alerts for Micron, CSX, Ariad Pharmaceuticals, IBM, Si http://t.co/XtSCPzVNWj
22 Oct 14 12:13:41
@bradloncar is the $aria eu decision due sometime in oct?
Rosner Stocks
22 Oct 14 11:41:19
$BITA Bid Click Here: http://t.co/dLmVn27eTg Also See: $ARIA $TSLA $EZU $ARIA ~
Dan Forman
22 Oct 14 11:26:45
$aria moved too much in too short a period of time. Profit taking day. Considering adding to my position for the next leg up
22 Oct 14 10:38:38
$ARIA currently -1.55% #options #BiotechTraderHandbook--> http://t.co/JDdc1OTfZF
By  +Follow March 28, 2014 9:43AM



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