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4 Biotech Stocks to Buy

When the market environment gets ugly (like now), biotech tends to become a safe-haven

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Valeant Pharmaceuticals Intl. (VRX)

VRX stock

Investors who don’t like drama may want to steer clear of Valeant Pharmaceuticals (VRX). It has teamed up with hedge fund manager Bill Ackman, of all people, to facilitate the acquisition of Allergan (AGN), and things have gotten ugly. Things have become so ugly, in fact, Allergan has taken legal action against both Ackman and Valeant. Perhaps even worse, VRX stock is back near multi-month lows after Thursday’s near-7% plunge, spurred by a disappointing forecast for the remainder of 2014 and all of 2015.

Given all of that, VRX stock looks like it hardly belongs on a list of biotech stocks to buy. What gives? Respectfully to Valeant Pharmaceuticals, it’s relatively clear the company is sandbagging its outlook in order maintain what’s a string of at least 14 earnings beats. The stock’s pullback since its February peak and the recent move under the 200-day moving average line (green) all sets up an entry opportunity.

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