Vertex Pharmaceuticals, Canopy, US Steel: Trending Stocks
Vertex Pharmaceuticals (VRTX) pops off on Wednesday upon headlines of positive trial results of its VX-548 pill, a non-opioid painkiller.
Shares of Canopy Growth Corporation (CGC) drag on the cannabis company's 1-for-10 reverse stock split.
Lastly, United States Steel (X) stock closes the day higher after reports of multiple acquisition bids valuing the steel manufacturer at $40 per share.
For more expert insight and the latest market action, click here to watch this full episode of Yahoo Finance Live.
Video Transcript
JOSH LIPTON: Let's check out Vertex Pharmaceutical, that name ripping higher today, up about 13%. That's on positive trial results for a new pain pill that could serve as an alternative to opioids. So this one, nice move in today's trade, Julie. And that was the headline here. It actually hit a record intraday high, it looks like. And this is on this news, positive results from, it sounds like, this mid-stage study of this drug, non-opioid, that helps, it sounds like, with nerve pain from diabetes.
JULIE HYMAN: Yes, so specifically, this right now was studied in treatment for nerve pain related to diabetes, but the hope is that it will have more expansive applications. And, as you alluded to, really, the pharmaceutical industry has been searching very urgently for alternatives to opioids because of the persistence and horribleness of the fentanyl epidemic.
And so this seen by investors as one potentially promising move. Jefferies analyst, Michael Yee, a friend of the program, said the data looks at least as good or better as-- or better than investor expectations. Vertex mostly makes cystic fibrosis treatments. So this is sort of-- would be a big deal more broadly in terms of the development of opioids. And it also would be a big deal for Vertex if it indeed is able to move forward with it.
JOSH LIPTON: What it sounds like, compete with a non-opioid treatment from Pfizer as well. Another name we're talking, too.
JULIE HYMAN: Yes, another name we've been talking about today.
JOSH LIPTON: That's what Pfizer needs, more competition, right?
JULIE HYMAN: Let's talk about Canopy Growth here. The stock is plummeting today, down by 20%, and that's of news of share consolidation. The company issuing a 1 for 10 reverse stock split. And this is a penny stock now, as you can see. It's down below $1 here.
JOSH LIPTON: Up in smoke.
JULIE HYMAN: It was-- oh gosh.
JOSH LIPTON: Too much? Too easy?
JULIE HYMAN: It's alright. It's too easy.
JOSH LIPTON: -- It's too easy. I get it.
JULIE HYMAN: This stock was above $50 as recently as 2021, but the cannabis industry has had a tough time, and Canopy has been subject to that as well. So that reverse stock split here really reflecting the weak sentiment that has been out there already with regard to Canopy.
JOSH LIPTON: This stock is a total mess this year. It's down about-- it's down nearly 80% year to date. And when you look at financial analysts who cover the name, you don't see a lot of confidence that things are going to get better. I see exactly one buy on this name right now, even after that drop.
JULIE HYMAN: And usually, when you do these kinds of reverse stock splits, it's because you're in danger of getting delisted. So it seems like that by doing this, it will not be delisted from NASDAQ.
JOSH LIPTON: All right, last one here, US Steel shares moving higher today. That's after reportedly receiving multiple bids. Over $40 a share. You can see a nice pop-up, about 6%. So reports that US Steel, Julie, they've now received multiple bids in excess of $40 a share. This is coming from CNBC, saying the board is actually meeting today, that's according to their sources.
And remember rival Cleveland-Cliffs made this public a few months ago that $35 per share cash and stock offer, and US Steel has been considering offers, we know, for months now. And you can date this one back to over the summer. Of course, just an iconic American company created more than 100 years ago. And still a very much important player, a big player in the steel industry.
JULIE HYMAN: Yeah, and we've definitely seen this push for consolidation, right? Because of some of the export controls, et cetera, that have been affecting the steel market, reportedly, ArcelorMittal, the Indian steel giant, also has been in the bidding here for this company. So we'll see what ends up happening. It is sort of unusually protracted, isn't it? You mentioned that it's been going on since the summer. But the bidding has really crept up here. That initial bid, I don't know if you mentioned, from Cleveland-Cliffs was $17.50, and now we're talking about $40. So that's a big change.
JOSH LIPTON: There is a deal, too, some questions. I mean, if the deal gets done, what does it look like? Is it all? Is it parts? Also, this kind of headline-making consolidation, does that attract regulators? You're talking about a deal that could really sort of redefine the industry. So it would be interesting, if it did happen, what kind of government response you would see there, too.
JULIE HYMAN: Right, exactly. Good point.
