Stock Market Champs..........9-14-06

Kendle International Inc. (KNDL)

Last Trade:	30.20
Trade Time:	4:00PM ET
Change:	5.40 (21.77%)

Kendle International Shares Rise As Reduced Outlook Remains Above Wall Street View

Shares of Kendle International Inc. jumped Thursday after the provider of contract research for drugmakers lowered its 2006 earnings guidance but still kept it above Wall Street's estimates.

Kendle shares rose $5.59, or 22.5 percent, to $30.39 in afternoon trading on the Nasdaq at more than quadruple their average volume. Shares have traded between $21.34 and $41.11 over the past 52 weeks.

In May, the company forecast pro forma earnings per share of up to $1.56 on revenue of $300 million to $310 million, expecting its acquisition of Charles River Laboratories International to close at the end of June.

However, the deal closed in mid-August, giving Kendle only 4.5 months of operating results from Charles River for the rest of the year.

Kendle now estimates pro forma earnings per share of $1.45 to $1.55 on revenue of $285 million to $295 million, before taking out stock option expenses, or costs associated with the acquisition. Including estimated stock option expenses of 11 cents per share, the company expects earnings of $1.34 to $1.44 per share. Kendle also anticipates closing charges of 19 cents per share, making for a range of $1.15 to $1.25 per share.

Analysts surveyed by Thomson Financial expect earnings per share of $1.28 on revenue of $273.1 million. Estimates do not include stock option expenses as a charge, and usually exclude one-time charges.

Baird analyst Eric W. Coldwell said in a research note shares jumped because the lowered guidance still exceeded Wall Street estimates and was "not the disaster that Kendle's valuation implied."

NeuroMetrix Inc. (NURO)

Last Trade:	21.25
Trade Time:	4:00PM ET
Change:	2.51 (13.39%)

NeuroMetrix Shares Recover From Wednesday's Losses As Analysts Rebuff Negative Rumors

Shares of medical device maker NeuroMetrix Inc. surged Thursday after analysts rebuffed concerns on rumors of a possible federal indictment and negative data on its NC-stat diagnostic system.

Shares rose $2.51, or 13.4 percent, to reach $21.25 on the Nasdaq in afternoon trading. It's been a roller coaster two days for the company, as shares lost 13 percent Wednesday. The stock has been trading between $17.89 and $41.19 over the last 52 weeks.

Analysts discounted rumors of an ongoing informal investigation by the Office of the Inspector General possibly turning into an indictment. The investigation deals with claims NeuroMetrix made on its products.

"Our channel checks indicate that the company is not the subject of any indictments and we note that indictments are highly unlikely without the involvement of the Department of Justice and/or the Federal Bureau of Investigation," wrote Jefferies & Company analyst Ryan A. Rauch, in a note to investors.

Rauch also dismissed rumors that NeuroMetrix will release negative data on its NC-stat system, which is used to diagnose diabetic polyneuropathy. Rauch noted there are are 37 positive publications of clinical data on the system, showing it is 95 percent equivalent to conventional testing.

RBC Capital Markets analyst William R. Quirk in a note to investors wrote "We believe the concerns about this stock are largely based on false information and we are aggressive buyers at these levels."

Quirk and Rauch both downplayed concerns over competition from Xltech and NeuMed, saying the companies do not have the same amount of clinical data to support their devices nor the sales force to successfully compete with NeuroMetrix. Quirk called the competitors "insignificant near-term competitive threats."

One cause for concern the analysts cited stems from negative reimbursement plan decisions by Cigna and National Heritage Insurance Company, the Medicare carrier for California.

The reimbursement concerns are "overblown" Rauch wrote, with both payers representing less than 3 percent of the company's revenue.

Rauch reaffirmed his "Buy" recommendation with a $41 price target, while Quirk reaffirmed an "Outperform" recommendation with a $50 price target.

Transmeta Corp. (TMTA)

Last Trade:	1.32
Trade Time:	4:00PM ET
Change:	0.15 (12.82%)

Matrix Research initiated coverage of the company with a strong buy rating.

Discovery Laboratories Inc. (DSCO)

Last Trade:	2.0900
Trade Time:	4:00PM ET
Change:	0.2400 (12.97%)

FOCUS Enhancements Inc. (FCSE)

Last Trade:	1.50
Trade Time:	4:00PM ET
Change:	0.30 (25.00%