Liams Last Post : Elan ammend their trial, Irish Banks shareholders endure their own trial...

Liams Last Post Tuesday 15/12/09

 

Good Afternoon ,

 

The year is really now starting to Drag. Newsflow is incredibly light , the big news today was the news of the 'Modification to the Elan clinical trial being run with Transition Therapeutics. 9 deaths on the trial , none of course directly linked to the trial but 9 nonetheless , so the trial is modified to stop the two highest dose groups within the trial. Not good news... and a blow for the drug which was supposed to have a potentially benign safety profile.   We had ascribed a 10% chance of success for this drug providing a per share value of c.50c in our Elan SOTP of $7.33/share... obviously this will be 'Ammended' too now.

The FBD news of their increasing estimate of the cost of the flood claims impacted the stock yesterday , the investment case remains very valid despite the increased one off cost of claims so the market reacted somewhat more positively and thstock continued to claw back the losses of yesterday. Elan managed a rather stoic performance with the stock pnly down -2%

 

The long suffering holders of the irish financials today continued to watch their stocks move lower. AIB -7.5% , having recovered from its low of over -10% at one stage and Irish Life which also fell -4.5% drifted on no news.  Bank of Ireland only down -2.3% was an absolutely heroic performance.

 

Fyffes holders await the final signature on the EU banana regime duty change. Potentially very earnings accretive unless the lower duty is competed away. Given the sector track record , I see no reason to assume that the lower duty wont be competed away immediately but it might provide a filip to sentiment even for a short while..

 

Markets today .... little ado about nothing , opened , dropped , recovered touched positive territory in Europe and closed basically flat on yesterday.  London eased into the close to finish down -0.5% and the USA after a decline inthe US EMpire State manufacturing index is down -.17% aat 5pm

 

Have a good evening.

 

Liam

 

___________________________________________

Liam Boggan

　

Merrion Stockbrokers

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