Hot Stocks: COUP jumps on going-private deal; CI sets 52-week high; RH falls on downgrade

Bouncing back from weakness seen through much of last week, stocks rallied on Monday, with the S&P 500 climbing about 1.4%. The gains came as investors positioned themselves ahead of CPI data and a Federal Reserve decision due out later this week.

Looking at individual stocks, Coupa Software (NASDAQ:COUP) expanded its value by more than a quarter after the company agreed to be acquired by a private equity firm. Meanwhile, Cigna (CI) added to recent gains to set a 52-week high.

Turning to the downside, RH (RH) dropped after an analyst downgrade. Meanwhile, Fate Therapeutics (FATE) posted a double-digit percentage decline on preclinical data.

Standout Gainer

News of a takeover deal sent shares of Coupa Software (COUP) soaring. The stock jumped 27% after the maker of cost control, compliance and business spend management software announced a deal to be taken private by private equity firm Thoma Bravo.

Under the agreement, Thoma Bravo will pay $81 per share, or a total of $8B, including debt. The agreement includes a significant minority investment from a wholly owned subsidiary of the Abu Dhabi Investment Authority.

Following the takeover deal, COUP finished trading at $78.65, an advance of $16.56 on the session. This took the stock to its highest finish since May.

Still, the stock, which had reached a 52-week high of $166.21, has fallen about 49% in 2022. Shares set a 52-week low of $40.30 early last month.

Standout Decliner

RH (RH) dropped 8% on Monday, reversing earnings-related strength seen late last week. The downdraft came amid a downgrade from Goldman Sachs.

Goldman cut its rating on the furniture retailer to Sell from Neutral, citing the likelihood that the firm’s sales “will likely remain pressured” as the company specializes in big-ticket, discretionary products and RH will suffer “the likely pull-forward of demand and highly promotional environment.”

RH dropped $21.44 to close at $253.06. This reversed gains seen late last week, when the company beat expectations with its latest financial figures and announced some acquisitions.

Monday’s slide took RH to its lowest close in more than a month. Overall, the stock has dropped about 53% in 2022.

Notable New High

Cigna (CI) extended its recent momentum, rising by another 2% to reach a new 52-week high.

CI closed Monday’s trading at $339.30, an advance of $7.18 on the day. Shares also established a fresh intraday 52-week high of $339.51.

The managed healthcare and insurance company has been building gains through most of the year. CI climbed almost 11% for the past month and advanced almost 45% for 2022 as a whole.

The latest momentum has been fueled by a reaffirmed forecast released last month. CI said it still expects 2022 consolidated adjusted income from operations to reach at least $23.10 per share.

Notable New Low

The release of preclinical data prompted a wave of selling in Fate Therapeutics (FATE). Shares slumped more than 14%, reaching a new 52-week low.

FATE announced preclinical data related to its induced pluripotent stem cell product platform as part of a treatment for acute myeloid leukemia. The product was used in combination with GT Biopharma’s (GTBP) Tri-specific Killer Engager.

On the news, FATE dropped $2.70 to close at $16.20. During the session, the stock reached an intraday 52-week low of $14.84. Adding to losses posted in the first half of the year, shares have slumped 73% in 2022.

To see more of Wall Street’s biggest winners and losers, turn to Seeking Alpha’s On The Move section.

Leave a Reply