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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
Chasing Stars
20 Oct 14 22:54:36
$CQP Stock Message Board Click Here: http://t.co/2SFdxFNgvf Also See: $IBB $ARWR $EWN $ARIA ~
Green Room
20 Oct 14 22:36:17
Watchlist for tomorrow $BBRY $ARIA $DRYS $KTOS $PLUG
Luke Lee
20 Oct 14 22:30:43
RT @RNA_Biotech: 9 takeover targets: $ACHN $ARIA $BMRN $INCY $ISIS $JAZZ $MDVN $PBYI $SLXP http://t.co/eFtDGvHG8T
Investors Hangout
20 Oct 14 22:20:50
$CLF Yield Click Here: http://t.co/C9YFnNGWOX Also See: $CYBR $FLY.V $EPI $ARIA ~
20 Oct 14 22:00:04
20 Oct 14 21:06:10
Our Penny Stock Picks Gained 371% In 2 Weeks! Get Our Next Pick Early: http://t.co/z2noBUWrEP $FASC $ARIA $TUCN
Chasing Stars
20 Oct 14 20:19:30
$ARIA Financials Click Here: http://t.co/JIAxgTKzn1 Also See: $HYG $ISNS $BBBY $RSH ~
Investors Hangout
20 Oct 14 20:18:16
$ARIA Ideas Click Here: http://t.co/GPvNtihEQr Also See: $CENX $CAT $IBM $RSX ~
Investors Hangout
20 Oct 14 20:18:05
$ARIA Message Board Posts Click Here: http://t.co/6WH7yQkKmW Also See: $BAC $AA $WESC $XLY ~
Rosner Stocks
20 Oct 14 20:17:46
$ARIA EOD Data Click Here: http://t.co/XIOlDPw5Zp Also See: $REGN $GE $CAT $GUR ~
Stock Forums
20 Oct 14 20:11:28
$ARIA % Change Click Here: http://t.co/diR353Cmwj Also See: $XLE $IBM $MMM $T ~
20 Oct 14 19:28:00
Tues watch: Momo: $SCOK, $CERS, $DRYS, $FREE, $NQ, $IBIO, $SPEX Chart: $ENTA, $RCON, $PACB, $DPW, $ARIA, $MFA, $RSH, $RDNT, $RIC, $ACCO
20 Oct 14 18:57:54
New post: 10/21 Watch List http://t.co/eHGKLv0Dhp $SCOK $ESI $NQ $SHLD $ARIA $BIOF $SHOR $NLNK
20 Oct 14 18:30:53
Harvey Berger, CEO of $ARIA another guy who was funded by the scamtastic David Blech & amazingly still has the same job.
Investing News
20 Oct 14 17:55:24
Today’s Recap & Some Stocks Setting Up $GLOG, $BBRY, $WFT, $ARIA. http://t.co/VqLKXgvaqa
Ruggero Respigo
20 Oct 14 17:44:23
Ruggero Respigo : Today’s Recap & Some Stocks Setting Up $GLOG, $BBRY, $WFT, $ARIA. via /r/stocks http://t.co/3PI7CjXG8F
20 Oct 14 17:24:39
Our Penny Stock Picks Gained 371% In 2 Weeks! Get Our Next Pick Early: http://t.co/z2noBUWrEP $FASC $ARIA $TUCN
G. Thomas Lackey Jr
20 Oct 14 17:19:08
October 20, 2014 RS Movers http://t.co/V3Mon3pcte $ITB $IYW $LUV $AEGR $ARIA $SSYS $CPHD $LEN $UNP $CBST $NFLX $CTSH $TYC $INTC
Dan Forman
20 Oct 14 17:01:04
@afmarko99 @afmarko99: Rbc:" $ARIA Iclusig TRx/NRx are 101/41, +26/+5% wk/wk, $PCYC Imbruvica TRx 1196, +11% wk/wk; NRx 441, +7% wk/wk…"
DayTrading Power
20 Oct 14 16:33:57
Live chatroom results today: went 29/32 for ALOT of $$$$ great day. Traded $SHLD $EBAY $MSFT $NQ $ARIA $BBRY. Are you trading with Power?
20 Oct 14 16:22:42
@afmarko99 $ARIA now that you are in it means that the stock will tank. J/k
20 Oct 14 16:22:25
ARIAD Pharmaceuticals Inc. (ARIA) Jumps 6.62% on October 20 $ARIA http://t.co/s0oO9Jm6Jm
20 Oct 14 16:03:19
MidCap #Stocks Trend $SHLD $LII $TSO $ARIA $NVR $HAS $TMHC $THRX $GMCR $GEF $DF $HPT $IP $LEN $NSM $ALK $DNKN @ http://t.co/tf79gD96D3
20 Oct 14 16:03:02
MidCap #Stocks Performance $SHLD $LII $TSO $ARIA $RCL $NVR $HTZ $JCP $UAL $LUV $AAL $SD $WTW $GCI $HAS more@ http://t.co/tf79gD96D3
Mark Romero
20 Oct 14 15:54:04
Today’s Recap & Some Stocks Setting Up $GLOG $BBRY $WFT $ARIA $IBIO http://t.co/tKxn5avvd9
Trader News Daily
20 Oct 14 13:23:50
Get reviews of top trading websites at http://t.co/sJnBwtOUTE. Sign-up bonuses available. Related: $MJNA $SD $ALU $GRPN $ARIA $RSH $GTATQ
Victor Roberts, MD
20 Oct 14 13:13:56
Commented on StockTwits: GANN angle magic! Predicted $ARIA price action correctly today! 6.05 was R! Couldn't bre... http://t.co/oCFA1lymVF
20 Oct 14 13:00:52
MidCap #Stocks Trend $SHLD $LII $TSO $ARIA $NVR $TMHC $GMCR $DF $THRX $HPT $LEN $DNKN $PHM $TE $ALK $CMS $AAP @ http://t.co/H27z0JgFGk
20 Oct 14 13:00:35
MidCap #Stocks Performance $SHLD $LII $WTW $TSO $ARIA $HTZ $UAL $RCL $NVR $HAS $GCI $LUV $QEP $TMHC $MDR more@ http://t.co/tf79gD96D3
20 Oct 14 12:58:30
After Massive Gains On Penny Stock Picks, another New Pick Is Coming! Check it out: http://t.co/lWd4jUXeCy $FASC $ARIA $TUCN
20 Oct 14 12:37:12
Eyes still on $ARIA for a HOD push.
Mark Romero
20 Oct 14 12:34:13
$ARIA In for 500 shares
20 Oct 14 12:27:30
$ARIA Strong all day http://t.co/2DRYdhc2Cq
20 Oct 14 12:21:11
$ARIA looks good for continuation imho
Victor Roberts, MD
20 Oct 14 12:10:06
$ARIA Where is "tornado" @TravelerRob? Fun to see his posts lately. He should start add to his long position instead of hoping to see low 4s
20 Oct 14 12:07:20
$ARIA looking to snap HOD here
20 Oct 14 12:04:39
$ARIA new HOD? HUGE VOLUME!!!! #news #breakingnews #cnbc $lake #DallasEbola $shpg $cmrx $tkmr $ibio $bcrx $SRPT $NLNK #ZMapp
20 Oct 14 11:37:51
$ARIA - getting ready to rally again! #news #breakingnews #cnbc $lake #DallasEbola $shpg $cmrx $tkmr $ibio $bcrx $SRPT $NLNK #ZMapp
20 Oct 14 11:07:36
@Drragu $ARIA how can you tell that there are no shares to short currently? Thx
Kenneth Meyerson
20 Oct 14 10:41:14
RT @TomSilver39: Rbc:" $ARIA Iclusig TRx/NRx are 101/41, +26/+5% wk/wk, $PCYC Imbruvica TRx 1196, +11% wk/wk; NRx 441, +7% wk/wk…"
Investors Hangout
20 Oct 14 10:36:23
$IWM News Click Here: http://t.co/mInqqMNmsE Also See: $BRK/B $ARIA $EWL $BABA ~
Susanta Bera
20 Oct 14 10:02:04
RT @Drragu: Commented on StockTwits: $ARIA ICLUSIG Sales are improving! http://t.co/rJjaKF2nwU http://t.co/stDbqO6mRc
Victor Roberts, MD
20 Oct 14 09:59:52
Commented on StockTwits: $ARIA ICLUSIG Sales are improving! http://t.co/rJjaKF2nwU http://t.co/stDbqO6mRc
Christian Kat
20 Oct 14 09:52:52
$ARIA if we brake USD 6 it will coil up!
T Abuhasna
20 Oct 14 09:51:32
Investors Hangout
20 Oct 14 09:44:24
clayton: $ARIA 5.74 http://t.co/w2xdcIm1Nb
Investors Hangout
20 Oct 14 09:44:22
clayton: $ARIA 5.74 http://t.co/m3BvksWYXk
20 Oct 14 09:42:03
$ARIA 5.74 http://t.co/1V9w7jOZmL
Victor Roberts, MD
20 Oct 14 09:36:53
Commented on StockTwits: Now WS crooked system trapping shorts by preventing to average down! $ARIA forced short ... http://t.co/yQC18act3b
20 Oct 14 09:32:37
RT @OptionCast: Short Squeeze Alerts $USU $Ticker Symbol $NLNK $RSH $DXM $ARIA $COCO $SFY $GDP http://t.co/vRTWxV5Spu
By  +Follow March 28, 2014 9:43AM



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