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Today I am recommending a bullish trade on AstraZeneca PLC (NYSE:AZN), a biopharmaceutical company focused on the development, discovery and commercialization of prescription medicines for a variety of diseases.
My indicators are giving bullish readings again this week, as the market continues its rebound from the October correction.
History shows that the market tends to rise into the end of the year during mid-term election years more often than not. In fact, according to research by Bank of America (NYSE:BAC), in years when there is a Republican president and a split Congress, stocks tend to post average annual returns of about 12%.
Out of all the sectors in the market, I still think that health care is one of the best places to invest for the long run.
Companies like Humana (NYSE:HUM), Pfizer (NYSE:PFE) and Merck (NYSE:MRK) are really going to prosper in this environment, as an aging population will mean perpetual demand for their products and services.
Furthermore, while I don’t mess around with the smaller, speculative biotech stocks for long-term investing, the bigger drug-makers enjoy a great profit buffer with their new drugs and product pipelines.
AZN is another one of my favorites in this sector, and with the stock breaking out above the $40 level this week, I expect it to continue moving higher. For that reason, I’m recommending bullish call options on the name this morning:
Buy to open the AstraZeneca PLC (AZN) Jan 42.50 Calls at $0.80 or lower.
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InvestorPlace advisor Ken Trester brings you Power Options Weekly, which delivers 5 new options trades and his latest trading advice to you each Friday. Trester has been trading options since the first exchanges opened in 1973 with a winning streak that goes back to 1984 with money-doubling average annual profits since 1990.