Citigroup Comments on Biotech Monthly Short Interest - January
February 7, 2006
SUMMARY
* Short interest data for the month of January (December 16th-January 13th) has been collected.
* Companies posting short interest increases m-o-m: AMLN (+5.7%), CELG (+7.5%), CVTX (+5.6%), DOVP (+14.0%), HGSI (+6.2%), IDIX (+3.1%), and VRTX (+9.6%).
* Companies posting short interest decreases m-o-m: GENZ (-21.2%), GILD (-1.4%), IMCL (-3.9%), MLNM (-15.9%), PHRM (-2.1%), and QLTI (-6.0%).
* DTC ratio: Days to cover ratio is defined as the number of shares sold short divided by the 90-day average trading volume.The highest days to cover ratio was held by CVTX with 10.8 days v. group average of 5.6 days. The lowest days to cover ratio was held by Gilead Sciences (GILD) with 2.3 days.
* Short interest for the month of January increased 0.1% as compared with the previous month.
OPINION
This note evaluates a monthly time period (beginning in the middle of the
month) in assessing short interest activity for our coverage universe. Short
interest may be defined as the total number of shares of company stock that
have been sold short and remain uncovered to date. Gauging short interest can
be a valuable tool in examining investor sentiment towards the
drug/biotechnology industry.
Data from December to January remained relatively constant. Short interest for
the month of January increased slightly at 0.1% as compared with the previous
month. However, significant movement was seen in several names.
Companies with markedly higher short interest m-o-m include DOVP (+14.0%), and
VRTX (+9.6%). Companies with significant lower short interest on a m-o-m basis
include GENZ (-21.2%) and MLNM (-15.9%).
The highest days to cover ratio was CV Therapeutics (CVTX) with 10.8 days. The
lowest days to cover ratio was held by Gilead Sciences (GILD) with 2.3 days.
The average for the entire group was 5.6 days to cover. Days to cover can be
defined as the number of shares sold short divided by the 90-day average
trading volume.
No meaningful sentiment change occurred in the industry on a month over month
basis. Amylin Pharmaceuticals (AMLN) and DOV Pharmaceutical (DOVP) held the
highest short interest (as a percentage of float) at 16.1% and 15.4%,
respectively, for the month of January.
JANUARY MONTHLY SHORT INTEREST
Source: Citigroup Investment Research, FactSet, and Bloomberg
MONTHLY CHANGE IN DAYS TO COVER RATIO
Source: Citigroup Investment Research and FactSet
COMPANY STOCK PRICES AS OF FEBRUARY 6TH, 2006 CLOSE
AMLN (3S): $38.31
CELG (1H): $70.00
CVTX (2S): $24.21
DOVP (1S): $17.35
GENZ (2H): $71.75
GILD (1H): $60.02
HGSI (1S): $11.42
IDIX (1S): $21.77
IMCL (3S): $36.34
MLNM (2S): $10.26
PHRM (2S): $16.27
QLTI (3S): $6.13
VRTX (1S): $34.30
All companies are covered by Yaron Werber, M.D.
I, Yaron Werber, M.D., research analyst and the author of this report, hereby
certify that all of the views expressed |
