Technically, it's still way too early to worry about an impending bear market; our models remain in a highly bullish mode, says Dan Sullivan, editor of The Chartist; here, he looks at four well-positioned drug stocks.
Our overbought/oversold indicator is back to neutral after being heavily overbought as recently as July 18.
Stocks appeared to be on the verge of trending lower over the near-term, however, looking further out, it remains, in our opinion, a very powerful bull market that has further to run.
All the key averages remain comfortably above their uptrending 50- and 200-day moving averages, which is typical bull market action.
Abbott Labs (ABT) reported better than expected second-quarter earnings as a result of improved profit margins and cost controls.
The nutritional segment of their business continues to be the star performer. Sales of Similac formula and Ensure rose 7.9% to $1.7 billion, representing one-third of Abbott's total revenue.
Abbott, which is in Dan's Aggressive Account and the Traders Portfolio, has been an okay performer. Its spin-off company, AbbVie (ABBV), has been a much better performer since trading on its own.
AbbVie reported second quarter earnings and revenues which beat expectations. The company earned 82 cents per share on revenues of $4.7 billion. Their key drug, Humira, recorded a sales increase of 12.1%, with revenue sold $2.6 billion.
AbbVie is poised for strong growth with a significant pipeline of new drugs with terrific potential. They are looking for 15 FDA approvals between 2013 and 2017.
Besides being a solid performer in Dan's Account and the Traders Portfolio, the stock has a good yield of 3.6%.
Amgen (AMGN), the world's largest biotech company, reported second quarter earnings and sales that surpassed analysts' expectations.
For the quarter, the company earned $1.89 per share. They are projecting full year revenue to be in the $17.8 billion to $18.2 billion range. The stock is in Dan's Portfolio and our Trading Portfolio.
Biogen (BIIB) reported that second quarter profits exceeded analysts' expectations. Biogen reported earnings of $2.29 per share, well above Zacks Consensus estimate of $1.83. Revenues for the quarter jumped 21% to $1.7 billion.
The company again raised its earnings guidance for 2013 and now expects earnings in the range of $8.25 to $8.50 per share. The stock continues to be one of the best performers in the Actual Cash Account, Dan's Account, and the Traders Portfolio.
Subscribe to The Chartist here...
More from MoneyShow.com:
The Next Big Biotech Bull Market?
