NEW YORK (TheStreet) -- Celgene (CELG) - Get Report shares are up 2.44% to $134.61 in late morning trading on Thursday after the biopharmaceutical company announced its $7.2 billion purchase of Receptos (RCPT) on Tuesday.
Celgene purchased Receptos for $232 per share, a 12% premium over the company's closing price from July 14, in a deal that the company said solidifies its inflammation and immunology portfolio.
"This acquisition enhances our inflammation and immunology portfolio and allows us to leverage the investments made in our global organization to accelerate our growth in the medium and long-term," said Celgene CEO Bob Hugin in a statement.
While the company said that the acquisition would not affect earnings until 2019, Celgene raised its 2015 earnings estimate to between $4.75 to $4.85 per share from its previous view of between $4.60 to $4.75 per share.
Insight From TheStreet Research Team:
Receptos was recently the subject of Trifecta Stocks 'Chart of the Day'. Here is what analyst Bryan Ashenberg and Bob Lang had to say about the company's chart.
Receptos is a name often mentioned by Jim Cramer on CNBC's "Mad Money" that has a great drug pipeline with tremendous prospects.
Analysts predict big things for this little company, even perhaps siding with a bigger name in a partnership or a takeover. The chart shows a very bullish picture.
We can see the very strong uptrend line that started in February with a series of higher highs and lows. Yesterday saw the stock reaching an all- time high on decent turnover.
We see a very narrow box and a breakout, the stock has had great relative strength. The Moving Average Convergence Divergence is now on a buy signal as the %R is overbought, which can stay that way for a while.
DISCLOSURE: Trifecta Stocks has no position in RCPT. This Alert is a technical analysis of the company's chart, and we are not taking any action in the stock at this time.
TheStreet Ratings team rates CELGENE CORP as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:
"We rate CELGENE CORP (CELG) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its solid stock price performance, impressive record of earnings per share growth, compelling growth in net income, robust revenue growth and notable return on equity. We feel its strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated."