Pending Buy Signal Should Propel This Biotech to My Target

by Sam Collins | January 23, 2014 1:32 am

Celgene (CELG[1]) — This company develops small molecule drugs for the treatment of blood-borne and solid-tumor cancers and inflammatory diseases. The stock was on my list of Top Stocks to Buy for December[2], near $164, and has been on the Trade of the Day buy list[3] for over a year.

On Oct. 4[4], I said, “On Jan. 9, 2013[5], with CELG just above $ 91, I noted that S&P said it had ‘the brightest growth prospects among large-cap biotech companies.’ And on March 18[6], at $111.25, I pointed out that it had broken from a cup-and-handle formation with a target of $125.”

S&P has raised its 12-month target several times, recently boosting it to $208 from $188. It estimates earnings at $5.35 for 2013 and $6.66 in 2014 (an upgrade from $6.54).

Technically the stock is in a powerful bull channel with initial support at its 50-day moving average at $163. CELG can be volatile. The stock is arching up from its 50-day moving average, should shortly trigger a buy signal from MACD, and has an excellent chance of breaking the high at $174.66 and running to my trading target of $180.

Investors may want to buy CELG as a long-term investment in the biotech sector.

CELG Chart
Click to Enlarge

Chart Key[7]

  1. CELG:
  2. Top Stocks to Buy for December:
  3. Trade of the Day buy list:
  4. On Oct. 4:
  5. On Jan. 9, 2013:
  6. on March 18:
  7. [Image]:

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