Dynegy: Pump Up The Volume

HOUSTON ( TheStreet) -- Dynegy ( DYN) finished Thursday's session with gains on heavy volume on reports of a possible acquisition by NRG Energy ( NRG).

Dynegy saw 44.4 million shares change hands Thursday, more than three times its three-month daily average, after Briefing.com reported market chatter about a NRG-for-Dynegy deal. Volume was greatest during the first half hour of trading, when Dynegy's stock hit an intraday high of $2.42. Shares pared gains but finished higher by 3 cents, or 1.3%, at $2.27.

Briefing.com also noted that Dynegy Oct. 2009 calls were seeing greater interest than puts on the rumor.

Dynegy has a 840.2 million-share float with a small short interest float of 2.6% as of Aug. 26, according to Yahoo! Finance. NRG, on the other hand, has a float of 264 million and a short interest float of 6.5%. NRG has a market cap of $7.2 billion, compared to Dynegy's $1.9 billion market cap.

Investor posts on Internet message boards Thursday noted that short interest in Dynegy is considerably smaller than it was a year ago. Others argued that any takeover of Dynegy would see shares fetch a price between $4 and $5. Dynegy shares have a 52-week high of $4.30.

China BAK Rides A123's Coatails

China BAK Battery ( CBAK) was trading sharply lower on above-average volume following the initial public offering of rival battery maker A123 Systems ( AONE).

A123 shares jumped 53.8% to $20.76 in its debut. The maker of rechargeable lithium-ion batteries raised $380 million by offering 28.2 million shares. China BAK shares had surged into A123's IPO, rising nearly 30% Wednesday on heavy volume.

However, China BAK shares were lately down 42 cents, or 10.6%, to $3.56. More than 1.7 million changed hands, compared to the stock's 50-day average daily volume of 231,000, according to the Nasdaq's Web site. China BAK has a 37.7 million-share float with a small short interest float of 2.9% as of Aug. 11, according to Yahoo! Finance.

Investor posts on Internet message boards called Wednesday's rally in China BAK shares a "fluke." Others noted that insiders own more than 30% of the company. One commenter noted that A123's surge Thursday gave it a market cap well above China BAK's market share, which stands at $206 million, and argued that China BAK's should be greater.

Keryx Biopharmaceuticals Trades Down on Heavy Volume

Keryx Biopharmaceuticals ( KERX) was trading lower Thursday on above-average volume one day after the company announced results of a successful trial of its kidney disease drug.

On Wednesday, Keryx said trial results indicated that long-term use of its Zerenex kidney disease drug for hyperphosphatemia, or elevated phosphate levels in the blood, can keep patients within the normal serum phosphorous range for extended periods of time and that the drug appears to be well-tolerated.

After rising 14% Wednesday on volume of 17.4 million, Keryx shares were lately down 11 cents, or 4.1%, to $2.58. In the first two hours of trading Thursday, more than 2.5 million shares changed hands, compared to the stock's 50-day average daily volume of 2.7 million, according to the Nasdaq's Web site. Keryx has a 44.4 million-share float, with a small short interest float of 1.6% as of Aug. 26, according to Yahoo! Finance.

Investor posts on Internet message boards Thursday note that a lot of money has poured into Keryx over the last few days as the stock is up nearly 100% over the last five sessions. Other posts noted the large amount of insider buying and a small float.

-- Written by Robert Holmes in New York.

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