I will be out for the majority of the day tomorrow. Be sure to give iBC’s new blogger a warm welcome, he is one of my favorite traders.
Look for comments from Phil from Brazil, as I asked him to update the comment section with stocks he’s watching. Also, keep a watch on [[MEDX]] Medarex inc. & [[SQNM]] Sequenom, Inc.
Note: The S&P 500 printed a nice bear flag that could get nasty. Check Stewie’s blog for the chart.
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“iBC’s new blogger” – Say what?
I’m just a poster, DPeezy. No blogger tag here — it was just a figure of speech by Ragin.
hi Phil, actually Fly promised us a new “tabbed” blogger that starts today, that must be who Ragin is referring to. We the readers are last to know who it is. I have a few guesses in mind, but who knows?
Folks,
I’m a long healthcare believer right now.
But I’m not against putting on a few hedges if the tape starts to slip here and we are unable to turn higher.
Some ideas for those who want to get exposure on the short side:
ROLL – Below the 50 and 200 day. These guys make parts for Boeing. In a world where Boeing (BA) is seeing an increasing rate of cancellations of its order book as airlines pare back and other parts companies like Precion Cast Parts (PCP) are getting hit, this could be a way to play it if you dont like to short near 52-wk lows. If you dont mind shorting near the lows, PCP looks like a good breakdown play.
LNN – These guys make irrigation equipment. If you look at other farm equipment best-of-breed stocks like BUCY and JOYG, they appear toppy. LNN broke down after earnings a few weeks ago. Despite good numbers, analysts were expecting better guidance. We have just begun testing the 94-95 (previous support — a neckline of sorts) are and the 50-day. Shorting a bounce can be tricky. For optimal entry, look for the averages to be green and for LNN to slip into negative terrotory, perhaps on a break below 91 with a partial position for a short.
CPST and ENS – Battery stocks appear to be slipping — courtsey of weakness in oil. These two names look like an interesting play on that. CPST is a confirmed H&S break. ENS is an earlier-stage H&S. A short around here with a tight stop is probably a good risk-reward strategy.
BBT – I like Fly’s BBT pick. If you really must short a bank, you need to short-strenght. Shorting weakness will cut you up with whippy financial stocks. I’ve looked into BBT. They provide financial services (lending, funding, investing) and have a lot of exposure to credit products in California and commercial real estate. If you must short this one, play it small (a whacky insider purchased shares a few days ago).
Those are just some of the ideas I’m looking at.
-Phil
For those who missed it,
here’s a post I left last night on Fly’s tab.
Just reposting for easy access here (needless to say, I’m a healthcare bull for the next few weeks):
HEALTHCARE/BIOTECH HITLIST
I figured that with all the rambling I did about biotech/healthcare, I owed you guys a good gameplan for the next couple of weeks.
I just went through my scan again of healthcare/biotech names experiencing ridiculous insider buying and sporting a cap of 400M, a price higher than $5 and decent liquidity. Then, I sifted through these stocks and selected the most decent-looking ones. Some of these should be familiar as theyve been mentioned as of late.
ARNA
HUM
LHCG
OSIR
HS
HALO
ALNY
BAX
IDIX
COV
GHDX
*note: I’ve excluded some stocks that have already had sick runs — as they no longer present good risk-reward opportunities for fellow IBCers.
Here’s another list of good-looking biotech/healthcare stocks with okay-to-excellent fundies that I also happen to like (just keep in mind that I’ve prioritized the technicals, so read the captions to get a better read on the fundies):
CMED (top pick — sick pattern 28 P/E 38% annual EPS growth beat EPS last Q by 58% yoy)
fundmental take: P/E in line with industry w/ explosive EPS growth (cheap and best of breed).
PKI (sick pattern 24 P/E no info on annual EPS growth beast EPS last Q by 20% yoy )
fundamental take: P/E in line with industry but EPS growth fairly-valued by P/E
UTHR (sick pattern 77 P/E annual EPS growth unavailable beat EPS this Q by 125% yoy)
fundamental take: Explosive EPS growth but P/E reminds me of ISRG.
CRL (sick pattern 28 P/E 16% annual EPS growth beat EPS last Q by 12.5%)
fundamental take: P/E in line with industry but EPS growth unimpressive and indicates the stock is slightly overvalued relative to its growth
Guys, feel free to post your ideas as well.
-Phil
Even me?
I’m liking the action on ROLL. Hedge has been applied here.
I’ve begun to buy MEDX @ 9.75 and looking to add to it with stop @ 9
MEDX was one of my favorites from scans last night and also showed up in RC notes to keep on watch.
Looks like short term could hit 11 and eventually fill the gap down from 13.
OFI continues to impress here. too extended to buy without very tight stop
but the money flow into it is a thing of beauty.
MEDX add 9.85
Just bot a little more CMED @ 46.79.
CHK broke $51, all is good for a while here.
rasing stop to 9.50 on MEDX
Got a little more CMED @ 46.53.
As long as this stock holds 46. I’m a holder.
MEDX add. Lets go!
Phil from Brazil,
What part of Brazil you from?
MEDX: 11 will be a weigh station for 13 and 10 will be too short to grab.
9 handle is the the chance to buy MEDX.
GSI nice IBD 100 potential over 15
From Rio. 😉
In honor of Fly, shorted some VMC at 64.75.
I’m looking for a move to at least 60 (for a partial cover) and then let it go after that.
Phil,
You like VISN on this pullback ? seems worth adding low vol pullback to me.
or maybe add at 20ish ?
Thanks !
Rio – I trust your stock pickin is as good as Pele scoring, ever been to Niteroi?
3 under $10
OFI 9.75 1/4
ALTH 9.68 3/4 full
MEDX 9.94 new full position
MOH sets up really well here stop @ 30
The healthcare names are endless here. The sector must be bought on pullbacks.
MEDX wins race to 10 but OFI is in a sprint to catch up.
quick update: Bought RIMM @ 121.24
Fucking missed GHDX! Damn! Did anyone catch it?
VISN … It looks like it could be okay for a nibble here as it retests base support at 23ish. It’s not my play though. Stock looks to extended and in this mkt, that is often fatal.
Just got back in it Phil, stop @ today’s low, VISN.
gtg.
Buylo,
Dont know is I can beat Pelé. I’ll be happy with a couple of slick Kaká-like dribbles in this market.
Matt,
You’re absolutely right. The key to healthcare is buying on pullbacks. Momo hardly works here.
MOH looks good.
visn trap door..wow
VISN was a drop of 2 bucks in like 45 seconds! boy!
MEDX looks solid @ 10.05
OFI seeing small rinse at days low. stop @ 9.20 on remainder
ALTH looks ready to close strong and rally toward 10
Wow. VISN got rocked.
Yeah, this mkt is without a doubt a sell the rips by the dips sort of mkt. You need to be a buyer when it hurts to buy and seller when you feel good about the stock. CELG’s a great example of a stock NOT to buy right now. It’s had a monster run. Any day now, it’ll get wacked and people will be left wondering what happened. It’s all about risk-reward. If the chart looks extended, it’s probably not a good idea in this mkt.
-Phil
VISN was ridic extended.
Still holding on to my CMED. My price is not bad. Bot a good amount at 46.94 yesterday and got more at 46.79 and 46.52 today. Again, as long as it trades above 46, things are okay. The 5min looks like shit right now, but then again, so did the 5min on GHDX about a week ago — look at that beast now. It’s the big picture on the daily chart that should serve as direction.
CMED remains my top pick going into next week — provided the mkt doesnt shit the shitter (which, it might).
Buylo,
Hadnt seen your reference to Niterói. Love Niteroi: just across from the Baía de Guanabara. Cariocas (guys from the City of Rio) often joke that the upshot to being a Niteroiense is the view across the bay. :o)
The women are also beautifull on the Niterói end. I was in Rio late last year (Nov-Dec) and had a good time with a club chick who happened to live in Icaraí, a waterfront neighborhood of Niterói. Good times…
Btw, if you need any help with Brazil (visiting, need some tips, places to go), drop me a line.
-Phil
Gotta love the close on CMED. Big boys mopping it up as we go into the close. Stock had been doing 400,000 shares (avg volume is 450,000 shares) until about 3pm. In the last hour of trading, some blocks hit the tape and the stock popped about 40 cents, tallying 720,000 shares on the day.
I’m fairly convinced this was the fake-out move to get the momo folks out (CVD did something similar on July 23 before turning around and ripping higher.
The action on the averages today was also very encouraging today (DOW was down about 100pts at one point and finishes marginally lower. It’s tough to say what’ll happen next in this crack-head mkt, but my gut tells me we rally next week.
As for CMED — next week, we ignite.
Good job today Phil, Thanks.
I agree on CMED, time to explode.
Hey RC! Thanks for the warm welcome!! Glad to be here, and glad that we’re finally partners again in our mission to beat the street. Ridiculously large and epic hat tip to you.
=gio=
rc,We hope you can come up with a better pick of the week for next week.Pick us a winner!
hey cajun, you got stopped out of VISN or holding ?
Wow! Huge oversight on my behalf. CMED reports Monday BMO. Hopefully, they report good numbers, but whatever the outcome, this was a huge slip-up on my part. I rarely take stocks into earnings, and especially not with the share size I have right now. Anyway, whatever the outcome (even if it opens 15% higher on Monday), I’m never going to let this happen again. This has now become more of a gamble than a trade. Sucks.
-Phil