Tuesday, April 22, 2008

Lots of Picks and Shovels

A bunch of picks and shovels companies reported strong earnings today. These companies supply R&D reagents / materials to pharma and biotech companies. Invitrogen, Sigma-Aldrich and Illumina all reported after the bell today and all beat their numbers big. This tells me that pharma and biotech are plowing big money into R&D and these R&D tool companies are benefiting big time. Qiagen is another tool maker that's scheduled to report on May 5th and I'm expecting strong numbers from them as well.

Yesterday, Genzyme received news from the FDA requiring a separate BLA for Myozyme produced in their Allston facility. I see this as a minor set back and will definitely be resolved by the end of the year. In many instances, companies will encounter some production set back when scaling up. This is a big buying opportunity.

Note: I have positions in Invitrogen, Qiagen and Genzyme. I would add to Sigma-Aldrich and Illumina on any pull back.

Wednesday, April 16, 2008

Monsanto Breakout

An nice breakout in Monsanto (Ticker: MON) today. The stock gained 7% on heavy volume and closing at a 52 week high of $131.95. The commodity stocks are on fire and today's news of a new $800 million stock repurchase certainly helped fuel the fire a bit. If I had some extra $$$, I would load up on Monsanto. This is a cyclical bull in commodities and has lots more to go.

Next week, keep your eyes wide open for earnings from Biogen Idec (Ticker: BIIB) and Genzyme (Ticker: GENZ).

Thursday, April 10, 2008

A Bio Buyout - Millennium

All I can say is “wow” with the acquisition of Millennium Pharmaceuticals for $9 billion by the Takeda, a Japanese pharma. I’ve always thought that Millennium would be taken out, but not for such a high premium. Here’s a company that’s expected to generate $670 million in sales for 09 with the primary sales driver being Velcade. That’s 13 times sales… They’re paying a lot! In any case, I think this will ignite the biotech sector. You have some of the big names reporting soon such as Genentech (after the bell today), Genzyme (4/23), and Biogen Idec (4/23). I’m very positive with the biotech sector in this gloomy economic environment.

Tuesday, April 01, 2008

More MasterCard and No More J.Crew

MasterCard simply looks too good right here both fundamentally and technically. It's breaking out into new highs and has held up well in this market turmoil. It's time to start adding to MasterCard. I picked up some more today at $227.35 and sold my position in J.Crew at $47.08. You can't go wring with either MasterCard or Visa...

Bought Some Smokes

Lots of people are still smoking regardless of the high price of cigarettes and health concerns. The big growth is of course international such as Asia. Phillip Morris International (Ticker: PM) spin off started trading yesterday. I picked up a few shares at $53.56 and sold a bit of Genentech (Ticker: DNA) to pay for this transaction. I still like Genentech a lot and have a good position in it, but I couldn’t pass up on the opportunity to pick up a cash generating machine.

Other news…

The Navteq (Ticker: NVT) transaction is still stuck as the Euro regulators raised additional concerns. I’m still looking for this to close, but it’s going to take some time.

With Merck (Ticker: MRK) and Schering Plough (Ticker: SGP) taking a big hit over their cholesterol drug (Vytorin and Zetia), could this be the catalysts for a Pfizer rebound? I think so…