John Ransom

Welcome to John Ransom’s Stocks in the News where the headlines meet the trendlines:

Stock number one: Puma Biotechnology

And the headline says: Breast Cancer Drug Data Boosts Puma Biotechnology- Investor's Business Daily:

Puma Biotechnology (PBYI) stock vaulted 42% to a new high in morning trading on the stock market today after the company reported surprisingly strong data from a phase-two trial of its breast cancer drug.

The study gave a regimen of Puma's neratinib combined with paclitaxel (better known as Bristol-Myers Squibb's (BMY) Taxol) to 115 patients with breast cancer at Stage 2 or worse, and compared those patients with a control group given paclitaxel combined with Roche's (RHHBY) blockbuster Herceptin. The results not only favored neratinib, according to Leerink Swann analyst Howard Liang, but presaged a good result for another study comparing neratinib to GlaxoSmithKline's (GSK) Tykerb.

Note: Roche’s Herceptin did about $6.5 billion in sales last year. Valuation for PBYI is likely to be expressed in percentage of worldwide market for breast cancer drugs.

Symbol: PBYI

Dividend: NA

Forward PE: NA; Trailing PE: NA

Estimate Trend: NA

Ransom Note Trendline: Buy Puma for speculative accounts.

PBYI Chart

PBYI data by YCharts

Stock number two: Microsoft Corporation.

Here's Why Microsoft and Electronic Arts are Plunging- Motley Fool

Microsoft was underperforming the Dow early on Thursday, shedding more than 3% after closing near a multiyear high on Wednesday. Speculation circulated that Ford CEO Alan Mulally would not be named Microsoft's next CEO. Mulally, who has had successful executive stints at Ford and Boeing, was widely expected to take over the Windows maker following Steve Ballmer's retirement.

Although he isn't know for being a tech visionary, Mulally helped design Microsoft's recent reorganization and may be best equipped to help remake Microsoft's corporate culture. Admitedly, it's only speculation, and Mulally could still be named Microsoft's next CEO, but for now, investors appear to be reacting by selling shares.

Symbol: MSFT

Dividend: 3%

Forward PE: 13; Trailing PE: 14

Estimate Trend: None

Ransom Note Trendline: Sell Microsoft

MSFT Chart

MSFT data by YCharts

Morgan Stanley

Citigroup, Morgan Stanley Downgraded on Fed Taper Fears- Barron's

Investors have been grappling for months with worries surrounding Federal Reserve policies. Upbeat economic reports reinforced fears that later this month the central bank could start to taper its $85-billion-a-month bond-purchase program. The Fed’s easy-money policies have been credited for helping fuel the 2013 stock market.

Symbol: MS

Dividend: N/A

Forward PE: 12; Trailing PE: 19

Estimate Trend: Steady

Ransom Note Trendline: Avoid Morgan Stanley

MS Chart

MS data by YCharts

John Ransom

John Ransom’s writings on politics and finance have appeared in the Los Angeles Business Journal, the Colorado Statesman, Pajamas Media and Registered Rep Magazine amongst others. Until 9/11, Ransom worked primarily in finance as an investment executive for NYSE member firm Raymond James and Associates, JW Charles and as a new business development executive at Mutual Service Corporation. He lives in San Diego. You can follow him on twitter @bamransom.

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