Valeant Phameceuticals Intl Inc (NYSE: VRX)
Valeant Pharmaceuticals has been having an incredibly rough time in the market as of late. However, we’re seeing strong gains from the stock today. So, what’s causing the gains? A large hedge fund investment. Today, we’ll talk about the large investment, how the market reacted to the news, another factor that could send VRX up even further, and what we can expect to see moving forward.
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Stoneridge Investment Partners Throw Big Money At VRX
Valeant Pharmaceuticals is having an incredible day in the market today, and for good reason. A recent disclosure with the United States Securities and Exchange Commission showed a massive purchase in the stock. The SEC disclosure shows that during the fourth quarter, Stoneridge Investment Partners LLC made a huge investment in the stock. During that time, the fund purchased 74,760 shares in VRX. The investment had a total value of approximately $7.599 million! As a result of the purchase, Stoneridge Investment Partners LLC is the 25th largest investor in VRX at the moment with a total stake in the company of approximately 1%.
How The Market Reacted To The News
As investors, we know that the news moves the market. Any time there is positive news released with regard to a publicly traded company, we can expect to see gains in the value of the stock associated with that company. The truth is that any time smart money makes a large investment, it’s good news for the company invested in. So, the SEC disclosure that became available today is causing big gains in the market for Valeant at the moment. Currently (11:09), VRX is trading at $66.36 per share after a gain of $5.05 per share or 8.24% thus far today.
Another Reason To Be Bullish On VRX
One of the biggest factors that has caused declines for VRX as of late has been its relationship with Philidor, an underground pharmacy that just so happened to be Valeant’s biggest customer. As a result of investor pressure, VRX was forced to cut ties with Philidor, losing a massive amount of prescriptions every month. However, shortly after cutting ties with Philidor, Valeant started a relationship with Walgreens, under which VRX would offer its prescription and over-the-counter drugs at a discount to Walgreens shoppers. This was a strong move, and as a result of this move, VRX is already getting close to selling the same amount of medications that it was selling with Philidor. While they are not quite there yet, they are making up ground relatively quickly, which is in incredibly good sign.
What We Can Expect To See Moving Forward
Moving forward, I have a relatively positive opinion of what we can expect to see from VRX. The reality is that the company has been dealt a pretty bad hand in the market lately. However, that doesn’t discount the fact that VRX is indeed a great company with great treatments for patients in need. Not to mention, when smart money is investing in a company, it’s because they are expecting to see exponential growth. The truth is that since the Philidor scandal, Valeant has been falling, leading to an appealing valuation for those that want to get in on the gains. All in all, I’m expect to see positive movement from the stock moving forward.
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What Do You Think?
Where do you think VRX is headed and why? Let us know your opinion in the comments below!
[Image Courtesy of Wikimedia]