Medical Mergers Sign of Market Health?-Minyanville

Medical Mergers Sign of Market Health?

Steve Smith Mar 25, 2009 1:00 pm


		A positive sign that companies see value at current levels.

Editor's Note: The following was posted in real time on our premium Buzz & Banter. It's being shared here for the benefit of the Minyanville community.

To follow up on yesterday's article: There's a definite increase in option activity that's being tied to takeover/merger speculation. Again, the health/drug/medical complex is the focus of activity. Some of the names being bandied about today include the following:

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Beckman Coulter (BEC), a company that makes biomedical laboratory instruments,
has seen a spike the April $50 and $55 calls, in which volume is exceeding prior open interest in the strikes.
Coventry Health (CVH) is getting a little lift and some active option trade on chatter that it might be in talks with another health-care provider. The name most mentioned is rival HMO, WellPoint (WLP).
There are also some tech names hitting the radar, such as Seagate Technology (STX) and MEMC (WFR) - both of which have seen nice moves up in their shares, 2 consecutive days of robust call volume and an increase in open interest.

Again, this is constructive in that it hints that companies see value at current levels. The option activity indicates that risk capital is coming back into the the trading market.

In memory of our fallen friend and trusted colleague, Bennet Sedacca, 100% of the donations made to the RP Foundation through April will be channeled to philanthropic endeavors consistent with the RP mission, working closely with the Sedacca clan in the distribution of those funds. We thank you kindly for your support as we strive to affect positve change in the lives of children.

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tags:

WELLPOINT, COULTER, BIOMEDICAL, BECKMAN, BEC, COVENTRY, CVH, SEAGATE, PROVIDERS

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