Friday’s Most Buzzworthy Stocks: Antero, Valeant, Southwestern Energy, More

WTI crude futures fell below the $50 per barrel mark today as traders take profits and on the news that production from some DUC wells have hit the market. Adding to the selling is the prospect of a Brexit that might cause sentiment to soften. Among the stocks that investors are buzzing about today are three energy companies, Antero Resources Corp (NYSE:AR), Southwestern Energy Company (NYSE:SWN), and Antero Midstream Partners LP (NYSE:AM), along with two healthcare ones, Valeant Pharmaceuticals Intl Inc (NYSE:VRX), and Sophiris Bio Inc (NASDAQ:SPHS). Let’s find out why each stock is trending and see how the smart money is positioned in them.

Our research determined that following the small-cap stocks that hedge funds are collectively bullish on can help a smaller investor to beat the S&P 500 by around 95 basis points per month (see the details here).

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Financial Deal in the Energy Sector

Antero Resources Corp (NYSE:AR) is expanding after agreeing to purchase 55,000 net acres in West Virginia from Southwestern Energy Company (NYSE:SWN) for $450 million. Net production from the acreage has averaged 14 MMcfe per day and proved reserves from the deal were 11 Bcfe as of the end of 2015. Southwestern will use the cash proceeds from the sale to pay down the principal of its $750 million term loan due in November of 2018. Antero is making the deal to enhance its position as a pure-play Appalachian operator and to increase its growth. Due to the transaction, Antero is raising its 2017 production growth target to 20%-to-25%. The deal is good news for Antero Midstream Partners LP (NYSE:AM), whose services will be used for gas compression, gathering, processing, and water services. Antero Resources Corp (NYSE:AR) will finance the deal by issuing 26.75 million shares of common stock. Underwriters have the option to buy another 4.01 million shares.

Of the 766 active funds that we track, Antero Resources Corp was the most popular, with 30 elite funds holding shares of the company at the end of March. Southwestern Energy Company (NYSE:SWN) was second with 28 top funds holding shares, while Antero Midstream Partners LP (NYSE:AM) was last with just four funds owning its shares at the end of the first quarter. Shares of Antero Midstream have gained over 4% this morning, while shares of the other two companies are down by about 3%.

On the next page we examine why healthcare companies Valeant Pharmaceuticals and Sophiris Bio are in the news today.
Valeant Considering Selling a Unit

Valeant Pharmaceuticals Intl Inc (NYSE:VRX) is in the spotlight after news broke that the beleaguered pharmaceutical company is considering selling its Amoun Pharmaceutical unit. Valeant bought Amoun for $800 million last year and a sale could help lower Wall Street’s concerns about the company’s debt. Amoun is the largest pharmaceutical company in Egypt and counts antibiotics, blood pressure medications, and veterinary medicines as part of its portfolio. Valeant is being advised by Goldman on the potential sale. The sale of the unit is at a preliminary stage and there is no guarantee of a deal. Bill Ackman‘s Pershing Square is one of the top shareholders of Valeant Pharmaceuticals Intl Inc (NYSE:VRX) and the billionaire hedge fund manager is working hard behind the scenes to turn the company around.

Sophiris Bio Spikes on Study

Nano-cap Sophiris Bio Inc (NASDAQ:SPHS) is over 105% higher this morning after a Phase 2a clinical trial showed that the company’s lead drug candidate for the treatment of localized prostate cancer, PRX302, had a response rate of 50% and was well-tolerated. Due to the results, Sophiris plans to continue with the development of the drug, which is also called topsalysin. Sophiris Bio Inc (NASDAQ:SPHS) was in the portfolio of four elite funds in our database at the end of March. As with all nano-caps, investors should perform due-diligence before trading in it.

Disclosure: None