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Stock Watch Update: HGSI

Posted by Posted by VFC on Oct 18, 2011

This morning we discussed the positive after-hours and pre-market trading of HGSI on Monday evening and Tuesday morning, respectively, and it turns out that Tuesday's regular-hours trading followed suit.

The spike in share price was born on rumors from the UK that Human Genome's partner for Benlysta, GlaxoSmithKline (GSK), is preparing a buyout bid, and names like Merck (MRK) and Biogen (BIIB) have also been thrown into the mix of potential suitors.

With still a couple of hours left in the trading day, HGSI hit triple-the-norm for volume and left no impression that the interest was slowing down.

As always with buyout rumors, nothing is a done deal until it's a done deal; anything else is purely speculation.

That said, this company has long been speculated as a buyout candidate, so there could be something there.

CNBC's Mad Money host Jim Cramer put out a strong sell sentiment for HGSI last week, convenient for anyone waiting to either cover a short position or start a long position before today's action - and with HGSI running pretty good today, should we expect a negative piece from TheStreet.com's biotech blog?

The HGSI story for sure isn't dying down. Conversely, things might just be heating up.

Disclosure: Long HGSI.

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