It's a positive day for the market today as investors' thoughts turn to the possibility of an April interest rate cut helping lift quality dividend-paying stocks to higher levels.
Notably, there are several stocks outpacing the gains of the S&P / ASX 200 (Index: ^AXJO) (ASX: XJO) for reasons other than the prospect of a lower cash rate. Let's take a look at them and consider why they might be climbing.
Primary Health Care Limited (ASX: PRY) has jumped 7% to $5.46 despite releasing no specific news to the market. A 7% jump for a company valued around $2.6 billion is significant and one reason may be speculation that the company may soon be the subject to a takeover offer. This article by my colleague Brendon Lau also explains why covering of short positions may also be behind today's rise.
Serious long-term investors don't buy stocks due to takeover speculation and investors are best off watching this story from the sidelines.
Ozforex Group Ltd (ASX: OFX) has climbed 5.7% to $2.41 as news was yesterday released to the market that fund manager AMP Limited (ASX: AMP) has taken a substantial position in the business.
OzForex has stumbled recently after news that its key banking partner Westpac Banking Corp (ASX: WBC) decided to cease its banking services partnership with the business. As an international money transfer business OzForex carries regulatory risk and in my opinion the potential for further regulatory change is a real issue for investors to consider closely.
Acrux Limited (ASX: ACR) has risen 3.6% to 86 cents as investors bet that its outlook might not be as gloomy as a tumbling share price suggests. Acrux has faced regulatory concerns over the safety of its key Axiron testosterone therapy product, with the US regulator requiring stricter health warnings on the product. The regulator has also demanded medical professionals only prescribe the product if certain medical conditions are met.
Despite the fanfare over the product's problems sales have actually held up reasonably well over the past year and all eyes will be on a late April announcement which will show the latest quarterly sales numbers. If the announcement is positive the stock may have more upside from here.
Liquefied Natural Gas Ltd (ASX: LNG) continues its yo-yo like behaviour to climb 4.3% today to $3.16. The stock's volatility is probably driven by the shifting oil price and uncertain outlook for a business which is still in the development phase, but on a big valuation.
LNG Ltd remains a speculative prospect, although if you're looking for reliable income and exposure to an LNG industry with genuine potential to take off in the years ahead it may be worth buying the below business.
