Why Are These Stocks Making Headlines Today?

Although crude futures have rallied by over 2% and the Dow Jones is 100 points higher today, shares of Aduro BioTech Inc (NASDAQ:ADRO), Trevena Inc (NASDAQ:TRVN), Zynga Inc (NASDAQ:ZNGA), Charter Communications, Inc. (NASDAQ:CHTR), and Valeant Pharmaceuticals Intl Inc (NYSE:VRX) each opened deep in the red before moving sharply in various directions. Let’s find out why traders were selling these stocks this morning and check out how the world’s greatest investors are positioned in each stock.

Our research, which 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).

Aduro Fails to Achieve Endpoint

Aduro BioTech Inc (NASDAQ:ADRO) is 23% lower today after the biotech announced that its Phase 2b study, ECLIPSE, which was investigating the company’s lead product candidate CRS-207 for the treatment of metastatic pancreatic cancer, showed that the drug failed to achieve the study’s primary endpoint in terms of it prolonging overall survival. The interim results of a second study, STELLAR, which also studies CRS-207, will be available later in 2016. The number of elite funds in our system with holdings in Aduro BioTech Inc (NASDAQ:ADRO) fell by one quarter-over-quarter to eight as of the end of 2015.

Trevena Ending TRV027 Development

Trevena Inc (NASDAQ:TRVN) has retreated by 7% after the company announced disappointing results from a trial of its own, which showed that TRV027, the company’s candidate for acute heart failure, failed to beat the results of a placebo in Phase 2b clinical trials. As a result, Trevena Inc (NASDAQ:TRVN) will terminate the development of TRV027 and dedicate its efforts towards TRV130 instead, which is a potential treatment for moderate-to-severe pain. Kevin Kotler’s Broadfin C apital was a major shareholder of Trevena at the end of March.

On the next page we examine why Zynga Inc, Charter Communications, and Valeant are all on the move today.

Technical Trading Detected in Zynga Shares 

Zynga Inc (NASDAQ:ZNGA) opened sharply in the red before rallying all the way back into positive territory as technical traders remain in control of the stock. Although shares of the social gaming company have trended higher since February, Zynga Inc (NASDAQ:ZNGA) faces technical resistance at $2.70 per share and the company needs to show that it can execute and deliver sustainable earnings to its shareholders before more bulls will buy in. Traders are uncertain how Zynga will do as the company pivots to mobile and eventually virtual reality gaming. Although Zynga has almost $1 per share in cash, the company has made value-destroying acquisitions in the past, although it’s now under new leadership. Of the 786 elite funds that we track, 20 of them owned $509.61 million worth of Zynga Inc (NASDAQ:ZNGA) shares on December 31.

Charter Down as Merger With Time Warner Nearing Close

Charter Communications, Inc. (NASDAQ:CHTR) is 3.4% lower today as the company nears the official closing of its merger with Time Warner Cable Inc (NYSE:TWC). Charter received approval for the merger from the California Public Utilities Commission on May 12, marking the last regulatory approval needed to close the transaction. Because of the approvals, Charter expects to close the merger on or around May 18. Out of the funds that Insider Monkey tracks, 89 funds owned over half of Charter Communications, Inc. (NASDAQ:CHTR)’s float at the end of 2015.

Valeant Gives Additional Discounts

Valeant Pharmaceuticals Intl Inc (NYSE:VRX) is 1.5% in the red after the drug company announced that it would grant hospitals rebates of anywhere between 10% to 40% off of Nitropress and Isuprel (subject to special conditions). One reason Valeant Pharmaceuticals Intl Inc (NYSE:VRX) shares have been crushed recently is because the company has earned a negative reputation as a chronic drug price hiker. By cutting prices, Valeant could improve its reputation and slowly work to regain the trust of shareholders and other investors again. Bill Ackman‘s Pershing Square is a major shareholder of Valeant and is working behind the scenes to turn the company around.

Disclosure: None