This week I’d like to coddiwomple through making mistakes and staying data-dependent to gain a...
Teva Sparkles with World's Top MS Drug
05/12/2010 2:00 pm EST
Josh Levine, editor of ChangeWave Investing, says blue chips are poised to overtake smaller stocks, and among them, this key pharmaceutical company is a core holding.
On the European side [of the Atlantic,] sovereign debt weighs heavily on the continent from Greece to Spain to Portugal and beyond. It threatens to short-circuit any hope of a sustainable recovery for most of the euro countries. Euroland has growing concerns that the $144-billion rescue package for Greece will fail to halt the debt-crisis contagion.
On the US side of the pond, economic growth and corporate profits have been powering stocks higher for over a year now. The economic news in the United States continues to live up to the findings in recent months of the ChangeWave Alliance Research Network:
- An explosive rise in consumer spending,
- a breakthrough in hiring,
- a surge in capital spending, and
- strong corporate demand across nearly every sector—especially semiconductors, manufacturing, oil and gas, and computer hardware and networking.
Meanwhile, the increasing volatility in the stock market mostly reflects this tug-o'-war between the rising momentum for US economic growth and the genuine fear that what are currently Europe's problems could soon become everyone's problems.
For my part, I've developed a strategy that will keep us fully vested in the growth game, and ensure that we won't let our often sizable profits fritter away should a big correction, or worse, occur.
The stock market has climbed more than 75% during the past 14 months, and I've gradually shifted our emphasis to larger, more dominant companies. More than ever, I believe this is the right time to invest in these stocks, since many of them have underperformed versus smaller stocks.
These are the companies that not only reign over some of the best growth markets, but are also cash-rich, and leaner and meaner because of aggressive cost-cutting. They are well positioned to add value through targeted acquisitions.
Teva Pharmaceutical Industries (Nasdaq: TEVA) said strong sales of its Copaxone drug and US generic products gave it a forecast-beating increase in [first-quarter] profit, which rose 16% to 91 cents per share. Sales grew 16% to $3.7 billion.
Sales of branded drug Copaxone, the world's top multiple sclerosis treatment, climbed 28% to a record $796 million.
Bottom line: Teva is one of our blue chips and a solid core holding. I urge you to build a full position in TEVA while the shares are trading below our $60 Buy Under price. Note, too, that our chief technical analyst Sam Collins [on May 4th] reported a strong Buy signal for TEVA. (Teva closed Tuesday at $58.63—Editor.)
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