ESRX, an independent pharmacy benefit manager and managed care company, provides a broad range of pharmacy benefit and medical information management services, as wellas managed vision care programs. For the 9 months ended 9/30/00, revenues increased 63% to $4.87B. Net loss before extra. item totaled $28M vs. an income of $38.1M. Revenues reflect higher member utilization and the addition of new members. Net loss reflects a $155.5M write-down charge.

January 9, 2001

Express Scripts thrives in its niche of providing retail drug card programs, mail pharmacy services and drug management programs. The company has more than 9,000 clients, including some of the largest HMO's and health care companies in the United States. Analysts expect 2001 to be a solid year for ESRX. Earnings are expected to grow 26.54% to $3.04 a share. ESRX announced a 2:1 split in October of 1998 when the stock was trading at $82.00. Now that the stock is trading at higher level than the last split announcement, we think ESRX is a solid split candidate. ESRX soared to a new high of $107.00 during the last trading day of 2000. Profit taking broke the solid up trend. However, ESRX now seems ripe for picking because it has found good support just above the 50-DMA of $80.75. The MACD is still negative, but we are trying to get a jump on a comeback rally. OBV and Money Flow held their ground during the selling and are both starting to turn back up. If the stock can take out the $87.75 resistance, a rally to $93.50 could occur quickly.

Picked on January 9th @ $86.56
Change since picked +0.00
Stop Loss @ $80.00

January 18, 2001

Express Scripts took a back seat to the solid technology rally today. ESRX dipped below its 10-DMA of $88.09 intra-day, which created just enough follow through selling to trigger our $87.50 stop. ESRX has enjoyed a nice two-week comeback, and some consolidation after this move is not out of the question. If ESRX can re-establish support, we may give this split candidate another try.

Picked on January 9th @ $86.56
Profit/Loss +0.94 (1%) (Stopped Thursday @ $87.50)
Best Profit +7.82 (9%)

January 16, 2000

Shares of Express Scripts wandered higher today despite a relatively anemic NASDAQ performance. As long as the overall market can hang in there, though, it appears likely that ESRX will continue its move towards the psychological resistance level of $100.00. In the short term, investors are becoming more confident that ESRX will announce a split. The last split was announced in October of 1998 when the stock was trading at $82.00. A 2:1 split announcement becomes increasingly likely every day that the stock remains above $82.00. ESRX will report earnings on February 7th. Current estimates are calling for profits of $0.65 a share, which would be a nice increase of 23% over the same period a year ago. The comeback rally for ESRX began when the stock found major support at the 50-DMA. This moving average still provides the long term support at $82.34. The past two trading days have seen the stock find some resistance at $93.50. A move above this resistance on volume greater than 800,000 could spark a more substantial rally. What’s more, the MACD has leveled and may start to turn back up soon and the OBV and Money Flow are still consolidating near their highs. One other positive technical indicator is the RSI, which has a lot of space to move before its signals overbought.

Picked on January 9th @ $86.56
Change since picked +5.75
Stop Loss @ $87.50

January 14, 2001

Last week saw a strong recovery take hold for the shares of this pharmaceutical prescription services company. ESRX benefits from a good business model that includes partnerships with many of the largest HMO's. The strong demographic trend towards an older population also contributes to the company's growth. To that end shares of ESRX may be poised for a split. The company's last split was announced in October of 1998 when the stock was trading at $82.00. Another split announcement becomes increasingly likely every day that ESRX trades above $82.00. At the end of the year, shares of ESRX moved above $90.00 and exploded to $107.00 within six trading days. Stocks have a peculiar habit of quickly ascending to triple digits once they cross the $90.00 threshold. We will see if history repeats itself this week. The MACD is starting to reverse its downward course. The Money Flow and OBV are once again in striking distance of their highs. There may be good intraday support provided by the 10-DMA at $89.94. Longer-term support can be found at the 50-DMA, which closed at $81.88. Friday's high print of $93.50 could prove to be mild resistance going into the start of the week.

Picked on January 9th @ $86.56
Change since picked +4.44
Stop Loss @ $80.00