Why Trevena Inc (TRVN), Unilever plc (ADR) (UL) and Freeport-McMoRan Inc (FCX) Are 3 of Today’s Worst Stocks

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After pausing briefly late last week, the bulls resumed a long-standing rally early Tuesday, carrying stocks deeper into new record-high territory. After the closing bell rang, the S&P 500 was at 2,365.38, up 0.60% and above a minor ceiling at 2,353 that had developed last week.

Why Trevena Inc (TRVN), Unilever plc (ADR) (UL) and Freeport-McMoRan Inc (FCX) are Three of Today's Worst Stocks It could have been worse though — you could have owned Trevena Inc (NASDAQ:TRVN), Unilever plc (ADR) (NYSE:UL) or Freeport-McMoRan Inc (NYSE:FCX). These three names were doomed from the start of today’s trading.

Freeport-McMoRan Inc (FCX)

Bad news for any FCX shareholders that thought Freeport-McMoRan was going to be able to come to some sort of agreement with the government of Indonesia. It isn’t, and FCX is paying the price. Already down 5% from its January high, the stock lost another 5.2% on Tuesday as the market came to grips with reality.

The mining outfit announced yesterday, when U.S. markets were closed, that a dispute with Indonesian regulators appeared as if it would go to arbitration rather than the matter being resolved before it went to such extremes. The impasse is ultimately rooted in newly created rules that require taxation and royalties on exports.

Copper prices recently hit a 20-month high, making the Grasberg copper mine in Indonesia — the world’s second biggest — of great interest as a revenue resource. Freeport has vowed to do what it feels is best for FCX shareholders though, even if that means shuttering the mine altogether until some sort of deal can be made.

Unilever plc (ADR) (UL)

FCX owners weren’t the only investors to experience heartache on Tuesday after the underlying company couldn’t come to an amicable agreement. Unilever shares also tumbled after rival Kraft Heinz Co (NASDAQ:KHC) gave up on merging with the outfit.

Kraft Heinz first put the idea out there in early 2016 (though the pairing had been floating in the market’s ether for years). The same headwind — regulatory concerns — repeatedly up-ended the merger, though it looked like the most recent effort might be successful. No dice, however. While regulatory concerns have been mostly abated, UL shareholders essentially said the offer from Kraft Heinz of $50 per share of UL wasn’t enough. Rather than put more money on the table, Kraft just walked away.

Both stocks, strangely enough, suggesting investors fully expected Kraft Heinz to improve the offer. UL fell 7.5%, while KHC was off to the tune of 1.8%.

Trevena Inc (TRVN)

Finally, on the surface it looks like biopharma company Trevena had some serious success with its phase 3 trial of painkiller oliceridine. The 40.1% pullback TRVN dished out today, however, says traders are looking beyond the headlines, and have noticed what oliceridine didn’t do.

Oliceridine is a painkiller that has been compared to morphine, and targets post-surgical patients. Unlike morphine, it tends not to cause nausea and breathing problems. Although there are a variety of pain relief choices on the market already, the Food and Drug Administration even saw enough promise in oliceridine to grant it a ‘breakthrough drug’ designation, with all the rights and privileges thereof.

As it turns out, however, not all dosage sizes treated pain as well as morphine did in late-stage testing. Throw in the fact that oliceridine will cost considerably more than highly proven morphine, and plenty of TRVN shareholders saw their hopes dashed.

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


Article printed from InvestorPlace Media, https://investorplace.com/2017/02/why-trevena-inc-trvn-unilever-plc-adr-ul-and-freeport-mcmoran-inc-fcx-are-3-of-todays-worst-stocks/.

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