The fact that JP Morgan initiated ZIOP today DOES NOT mean they are not investment bankers working with Kirk and Lewis on a partnership deal. There is a wall between the sell side analysts and the Investment Banking arms – they are usually not even in the same building.
I was CFO and COO of a NYSE bank – we were selling our company in a “Dutch uncle auction”. The high bidder and ultimate acquirer did MONTHS of due diligence with a 30 person team plus outside tax experts, investment bankers, lawyers, and consultants. They were in heavy negotiations to get us at the lowest possible price. After a particularly heated meeting on what they would pay for our company, the next morning (in the middle of negotiations) their sell side analyst who covered us RAISED THEIR TARGET PRICE to above what their own company was offering.
Obviously they had no idea that the Investment Bank side of the business was trying to buy my company and negotiate the price down. I have other stories like this to.
SO – it does not mean JP Morgan is not working with Kirk and Lewis. Perhaps they are not – perhaps its another investment bank – but this means nothing to that scenario.
JP Morgan analyst likely started working on this when secondary took place - sometimes takes 90-120 days to initiate. Great to have a top notch firm that runs the most important healthcare conference in the world each yr to be supporting ZIOP.
I still expect a pali partnership by the summer or sooner. Too much Big Pharma need for pipeline. This one is cheap with a 2029 patent expiration and at least another possible indication and also some synergy with early Intrexon pipeline.
Tough market last 3 weeks – ZIOP is really hanging in nicely.
When the investment banking side of a brokerage is negotiating with a public co. I question whether their research dept. would be allowed to continue to publish research on that company. A 'restriction' on analyst coverage is usually in place from my past knowledge of the industry.
As others have said - their is a wall between the two divisions of the IB. They definitely can issue research - please re-read my personal example where the sell side analyst of my company RAISED the target of my company when his company was in the middle of bidding for our company and trying to talk the buy price DOWN.
Obviously that company's analyst would not raise his target on a company if he knew his company was bidding for the company he covered. This proves you can cover a company - the wall in place - if your IB side is working with them. Technically the sell side analyst should not even know. They certainly did not in my example
VERY conservative - makes sens though - I think we hit their target before summer is over. Then they can raise.
That's how you do it - a step approach.
A few more data points on intrexon portfolio and it will be clear the value of the all cancer indication rights in ZIOP price is GROSSLY undervalued. Intrexon deals and IPO will then on top of that prove it again.
This imo could be one of the best performing stocks for the next 12 months.