The healthcare field offer a wide variety of ideas. Jessica Chiaverini looks at a wound treatment, while Ken Kam looks at a bio-terror pick. Yola Edwards see trading potential in Amgen, and Chuck Carlson looks at blue chip J&J. Nancy Zambell opts for a microcap in medical monitoring.
"Low prices for shares in Curative Health Services
(CURE NASDAQ) have tempted us long enough, so we've
named the stock our Hotline Special," says Jessica Chiaverini,
of The Prudent Speculator. "Curative was a
former portfolio holding of ours; we made 149% on our first go round. The
firm provides services to sufferers of acute and chronic conditions
through community-based branches and offers chronic wound treatment to patients
in hospitals. CURE shares recently fell on news that revenue rose 44%, but
that earnings fell to an adjusted $0.06 per share versus $0.30 in the year
prior. While its outlook has darkened a bit, the shares now trade for 29% of
trailing 12-month revenue and a trailing 12-month p/e of seven. So here's a
case where we know a stock well and have to weigh attractive income-based
valuations and management-endorsed growth metrics against a weak balance sheet.
We've decided that the former trumps the latter. Our fundamental goal price for
the stock is $13 and we're buyers of the shares up to $6.40."
"Hollis-Eden Pharmaceuticals (HEPH
NASDAQ), as the 9th largest m100 holding (representing our best stock
pickers), has been a staple of our portfolio for several months, dating
back to the m100's original buy-in during March," says Ken Kam
of Marketocracy. "Hollis is a biotech company
that develops treatments for diseases and disorders affecting the human immune
system. Hollis has been a beneficiary of the bio-terror scare, as the company
has been working closely with the US military on a treatment for radiation
exposure. Hollis is a small-cap ($185M) company with no sales or earnings
yet, although their cash horde is $4.11 per share—almost
half their total share value. All of this amounts to Hollis ending up as a top
sector pick for the m100, as the top group increased their holdings by 39% over
the last two weeks. We'd also note that while our 'best' stock pickers
have increased their holdings, buying steadily as the price has
dropped from the $11 range, the 'rest' of our monitored investors have trimmed
their stake by 26%—
which
makes Hollis a 'strong buy' recommendation."
"Amgen (AMGN NASDAQ) is our top speculator’s pick for the
month," says Yola Edwards in Top
Stocks. "The firm is a global
science-based, patient-driven company that discovers and markets cost-effective
human therapeutics based on advances in cellular and molecular biology. Some of
their products aid in reducing the symptoms of rheumatoid arthritis, psoriasis,
and psoriatic arthritis, while others address oncology problems. Although anemia
treatments Epogen and Aranesp, account for almost half of Amgen's sales, the
company has two more drugs in late-stage clinical trials and 16 other candidates
in mid-stage trials. Amgen is one of the few biotech companies to generate
consistent profits and it trades at just 20 times estimated 2004 earnings, which
are projected to grow at 20% over the next three to five years. Overall, Amgen
offers an attractive buying opportunity; the shares are best-suited to
active traders who are seeking capital gains and are prepared to accept
above-average risk."
"Wall Street has not exactly been kind to pharmaceutical stocks in
recent years," notes Chuck Carlson, editor of the DRIP
Investor. "One stock that had been affected by Wall Street’s cold
shoulder was Johnson & Johnson
"Priority Healthcare (PHCC NASDAQ), one of the nation's fastest-growing
specialty pharmaceutical distributors, has the prescription for potential
gains," says Nancy Zambell in Elite Small Cap
Trader. "As hundreds of new medications flood the market
promising to cure all our aches and pains, the sheer number and variety is
overwhelming. Many new drugs are highly complex, difficult to store, and
complicated to administer. And in spite of their effectiveness, many new wonder
drugs have a long list of potential side-effects requiring constant monitoring.
Most doctors simply don't have the time, and many pharmacies don't want to take
the responsibility. Enter Priority Healthcare. The company manages these complex
medical treatments for doctors and HMOs. Priority grew its sales more than 39%
annually over the last five years. But there's another very special catalyst
promising to really move these shares higher in a hurry. Priority Healthcare
just announced a partnership with a very big, prestigious, and deep-pocketed
titan in its industry—
Aetna. This is a huge home-run for Priority, since it
gains access to millions of new potential
customers."