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| PLAY > New Plays |
Tuesday, December 05, 2000 |
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New Split Plays
No New Split Plays
New Candidate Plays
| GELX - Geltex Pharmaceuticals $57.13 +3.75 (+2.25) |
Geltex Pharmaceuticals develops and markets non-absorbed polymer drugs that bind and remove target substances in the gastrointestinal tract. The company's first commercial product, Renagel, is used to treat elevated phosphorus levels for dialysis patients, and currently brings in about $14 million for the company each quarter. Currently, GELX has 21.75 million shares outstanding with 50 million shares authorized, so a 2:1 stock split is a possibility. We'll keep you posted on any split developments that may occur. As for the stock, shares just broke above their recent high of $56.69 and held on to close at an all time high of $57.13. A long uptrend separated by several momentum runs leads us to believe that GELX could challenge the $60 mark. Good volume of 500,000 shares or better will likely be needed if the stock is to advance above this level. Should this scenario come to fruition, we'll look for a tougher challenge to reside at $65. If light volume accompanies GELX to either of these resistance levels, then consider locking in profits or tightening stops. As for support, the recent base at $56 is bound to offer some degree of support. Just lower, the $55 mark should present a firmer base, with the 5-dma of $55.40 and an intermediate high of $55 offering strength to this level. Set stops at $52 to protect against a reversal in trend. Consider reconfirming your entries with strength in the AMEX Pharmaceutical Index (DRG) prior to opening positions.
New Momentum Plays
| UTX - United Technologies $75.88 +3.31 (+5.38) |
United Technologies is a difficult stock to classify. Is it a momentum stock? Is it a value stock? Is it a growth stock? Is it a cyclical stock? Arguments can be made that this DOW component possesses characteristics of all four groups. This fact can only help the stock as it attracts a wide range of investors. UTX is trading near its all-time highs and yet only sports a P/E of 25.46. Although the company has a consistent history of splitting its stock, it usually does not do so until the stock is comfortably in triple digits. Obviously UTX is not there yet. For 2001, UTX expects earnings growth of about 15%. The current rally is approaching critical resistance at the all time high of $75.97 established in May 1999. A break above this double-top resistance could result in a substantial move. To that end, the Money Flow and OBV are rising, the MACD is positive and the RSI has more room to move before an overbought condition is signaled. If all of these technical indicators stay in line, UTX just may have enough strength to reach historical split levels.
New Plays Index
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