Update-2 4/26..ABBVIe (ABV) beats on sales and earnings but Humira revenue concerns linger stock down 4+%. SMID caps up: CRMD,CYRX, GERN,SUPN, TXG etc….XBI up 1.5% after dipping to $81 .
Update-1 4/25…MRK up over 3% on confirmed guidance Revs at $63-64B,EPS $8.53-8.65, Junuvia drug on Medicare IRA targeted list, gains on blockbuster Keytruda Q1 sales of $6.9B. Anxious mood from META earnings, inflation and weak GDP scare investors but recovers. AH risk appetite absorbed with MSFT earnings stock up. Ditto for GOOGL earnings beat and dividends stock up AH.
- BMY continues downward 8% to $44.78 swings to Q1 loss cuts forecast ,revs rise to $11.9B on long term growth of new products from acquisitions.
- XLV holds bottom at $139 level.
- Spec SMIDs back to red screen with XBI down 2.2% to $82 level.
- Astra Zeneca (AZN) up 5.5% o $75 on Q1 beat and 26% incr in revs from Oncology
- UNH up over 1% to $493, a nice recovery from $440 lows earlier in month.
- Gilead Sciences (GILD) incr revs 5% YoY, $3.9B e charge from CymaBay acquisition. Stock up 2.68% AH!
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- XLV is stabilizing so maybe healthcare will resume its defensive posture in the market. Action is elsewhere however: MAG 7, chips, software, AI etc
- Earnings for large caps should set stage beginning with ABBV on Friday. BIIB off bottom up 6% with mixed guidance.
- Momentum is lacking in growth stocks so looking for help from MedTech: ABT, BSX, GEHC, SYK.
After a few grueling weeks of seling markets rallied giving investors a chance to re-balance their portfolios. But the focus is on the FED and inflation so the tape remains choppy. We have not had a chance to look for new opportunities in the market. Look in depth to Danaher (DHR) a major growth stock and a core holding of many Life Science Funds and ETFS. Danaher was up 7.2% yesterday to the $252 level on high volume but there was distribution of stock. Revenues decreased YoY to $5.8B with Net Earnings of $1.1B and cash flow of $1.7B. Order trends improved in bioprocessing and the Company gained market share in molecular diagnostics with CEPHEID products. Thermo Fisher (TMO) a similarly positioned quality growth stock was also up 4.78% but down slightly today with slackish product demand. EPS was up 4% to $3.46 on $10.34B in sales..Both companies have grown through M&A , up 123% and 117% respectively but most stock appreciation occurred prior to 2022. Hologic (HOLX) another well diversified omens Health and molecular diagnostic player we cover was up 1.27% today and reports on May 2.
Almost all of our speculative Life Science trades were up yesterday and we will review them at the end of the week. Momentum has led the small caps over the past month so until we get earnings only technicals and deal news matters. We bought a little XBI at bout $83 on Monday and expect this to be a good play on any SMID biotech rally and a belwhether on momentum. We also own other small cap biotechs but watch these on the next rally; CRMD, CYRX, EXEL, TWST, SUPN, VCEL .But the green screen from yesterday has turned red!
Many large caps rallied and appear to trade with FED policy and treasury rates. We are LONG many of them : ABBV, LLY, MRK, REGN, RHHBY, VRTX.
THe IBB gained 1.5% yesterday to the $128 level but still down 5.76% YTD, hardly the beginning of something new. The XLV is up 1.89% since our last post and looks like a YTD bottom at $138 helped by UNH earnings up 3.69% over 5 days.
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Update: 11:45 4/24…MEDTECH: I reviewed FSMEX Fidelity Medical Technology and Devices one of our top picks among mutual funds now trading at 63.92 and noticedt that it was at 2yr highs last week but way off 2021 highs around $90. It looks like the FUND is overweight diagnostic tools and devices with a weighting of about 22% for DHR and TMO. The top weighting is BSX but many other holdings include ISRG,SYK, EW and ABT. The IHI today is around $55 up 3% YTD. This free-fall in assert value as you remember was COVID related.
So as we get through earnings then you can add selected MEDtech stocks while holding FSMEX. I have done this by holding ABT, SYK and GEHC to complement FSMEX.
LONG : ABT, FSMEX GEHC, HOLX, MRK,UNH, SYK, XBI, Several large cap biopharmas.