Tuesday, October 19, 2010

Kinetic Concepts [KCI] takes a whipping in WD Texas

On 18 Oct 2010, a judge in U.S. District Court for the Western District of Texas ruled claims of two Kinetic Concepts patents invalid. The inventions themselves came from Wake Forest University.

As to expectations, wsj online noted: The decision to render the patent claims invalid was "the least likely outcome and unexpected by most investors," Piper Jaffray analysts wrote in a note Tuesday.

Of KCI stock, Schaeffer's Options Center noted:

Meanwhile, option volume has soared to 57 times the norm on KCI today, with roughly 11,000 contracts changing hands. Puts have comprised the bulk of this volume, with over 9,100 of these bearishly oriented options crossing the tape.

Today's most active strike has been the January 2012 30 put, with 5,213 contracts traded -- 98% of which changed hands at the ask price, indicating they were likely purchased. Meanwhile, with just 40 contracts currently open at this strike, it seems that these puts are, in fact, fresh positions.

Separately, on the biofuels front, from CBS WINK


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