Why MannKind Corporation (MNKD), Sears Holdings Corp. (SHLD) and Regeneron Pharmaceuticals Inc. (REGN) Are 3 of Today’s Worst Stocks

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In a complete 180-degree turnaround from a sharp pullback over the past week and a half, the bulls pushed back with a vengeance today despite a lack of motivating news. The S&P 500’s close of 2,105.13 was 1.2% better than Tuesday’s closing value.

Why MannKind Corporation (MNKD), Sears Holdings Corp. (SHLD) and Regeneron Pharmaceuticals Inc. (REGN) Are 3 of Today's Worst StocksIt wasn’t a banner day for all stocks, however. Regeneron Pharmaceuticals Inc. (NASDAQ:REGN), Sears Holdings Corp. (NASDAQ:SHLD) and MannKind Corporation (NASDAQ:MNKD) all got hit hard. Here’s what investors need to know.

MannKind Corporation (MNKD)

Right on cue, the MannKind Corporation rally was tripped up yesterday by an article suggesting its inhaled insulin, Afrezza, may not be a solution doctors fall in love with anytime soon. The timing for the sweeping reversal couldn’t have been any better and more dramatic if it were written for a John Grisham novel. Between today’s 9% dip and yesterday’s pullback, MNKD stock is off more than 15% in just the past two days.

The commentary in question — penned by the often-controversial Adam Feuerstein and posted at TheStreet.com — referenced some informal research done by Jefferies analyst Shaunak Deepak regarding doctors’ interest and likelihood of prescribing Afrezza. Though most have yet to prescribe the drug, the few that have are satisfied with the decision.

Still, somehow Feuerstein spun the relatively untelling survey into something dire, driving MNKD sharply lower as a result.

Sears Holdings (SHLD)

The Sears Holdings rout just completed its fourth day, with Wednesday’s drubbing being the worst yet. When all was said and done, the near-12% plunge from SHLD today translates into a 28% plunge just this week.

Don’t look for a specific reason today for the stock’s downfall. Rather, the struggle for SHLD began even before last quarter’s earnings were released Monday evening, largely because shareholders are less-than-thrilled with the proposed (and now almost realized) spinoff of a couple hundred Sears Holdings stores into a REIT. Poor earnings numbers simply fanned the bearish flames.

In many ways the stock’s plunge makes sense. The REIT offering entitles current SHLD owners to buy half of one share of the REIT being formed by a portion of the company’s real estate. But, in that the transfer of 254 of the company’s 1000 or stores to the REIT constitutes the removal of tangible assets from the balance sheet, the maneuver inarguably lowers the total value of Sears Holdings shares.

Regeneron Pharmaceuticals (REGN)

Superficially speaking, the news should be spurring Regeneron Pharmaceuticals shares higher on this first day back from a trading halt on REGN stock. That’s not how things went on Wednesday, though, after investors had a chance to sleep on the announcement.

The news in question was a report that an advisory panel recommended the approval of a cholesterol fighting drug jointly developed by Regeneron and Sanofi SA (NYSE:SNY). The news was expected to be so big, in fact, that trading was halted all day on Tuesday for REGN.

So why was REGN off by nearly 3% today after its one-day trading hiatus? In short, a reality check.

Though Praluent is measurably (broadly) more effective than statins at lowering the so-called “bad” LDL cholesterol, many members of the advisory panel were quick to point out it was far from an ideal solution to the problem Regeneron Pharmaceuticals is trying to tackle. Namely, aside from the high cost, there’s not yet any actual proof the drug staves off things like heart attacks or strokes. The only thing known for sure is that Praluent lowers cholesterol levels. Until that longer-term results data surfaces in 2017, usage of the drug could be tempered.

As of this writing, James Brumley did not hold a position in any of the aforementioned securities.

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Article printed from InvestorPlace Media, https://investorplace.com/2015/06/mannkind-corporation-mnkd-sears-holdings-corp-shld-regeneron-pharmaceuticals-inc-regn-3-todays-worst-stocks/.

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