Becton, Dickinson and Company manufactures and sellsa broad line of supplies, devices and systems used by healthcare professionals, medical research institutions and the general public. For the 3 months ended 12/31/00, revenues fell 2% to $843.3M. Net income decreased 19% to $60.6M. Results reflect unfavorable foreign exchange translation, remaining inventory reductions at the trade level, and the discontinuation of certain distributor incentive programs.

February 11, 2001

BDX is engaged in the manufacture and sales of a diverse array of medical products and systems. It has long been known to offer products of a superior quality. BDX outperformed the market last week after Lehman Brothers reiterated its “Strong Buy” rating on the company. Currently, Lehman Brother's year-end target price for BDX is $42.00 or 25.5 times expected 2001 earnings (fairly modest). The research firm also noted that an increase in sales due to new Federal safety requirements will likely come sooner than later because the compliance date for the new rules has been moved up to April 18th from August 1st. On Friday, BDX closed only a penny below a newly established 52-week high. A move above $37.04 may prove to be an excellent entry point for momentum traders. A run to resistance at $40.00, established in mid-1999, could occur quickly if the stock trades above $37.04. A bounce off support offered by the 10-DMA just below $36.00 may also prove to be a good entry point. The MACD is rising, which suggests the continuation of the positive trend. Money Flow is very strong and is establishing new highs, which also casts a positive light on the potential for more gains.

Picked on February 11th @ $37.03
Change since picked +0.00
Stop Loss @ $34.50

February 22, 2001

BDX manufactures and sells a wide range of medical products that are used by healthcare professionals, researchers and individuals. BDX has enjoyed strong demand for its diverse product line and this has made the stock attractive to investors. BDX has been a relatively safe harbor during the recent dismal performance of the general stock market. In fact, BDX established a new 52-wek high of $39.25 just last week. Obviously, BDX has pulled back from this high, but the good news is that the stock appears to be establishing a base. Today's low of $36.00 is the support at the bottom of this base. If this support can continue to hold, look for BDX to eventually rally and perhaps test the resistance offered by the 52-week high. Momentum traders may want to wait for the stock to move above the $37.31 resistance before initiating a position. It is likely that a move above $37.31, accompanied with midday volume over 750,000 shares traded would result in a sustainable move. We continue to be impressed with the Money Flow and OBV. These technical indicators are telling us that there is more volume during up days than down days, which confirms a longer-term bullish trend.

Picked on February 11th @ $37.03
Change since picked -0.64
Stop Loss @ $34.50

February 20, 2001

We may have been a bit early when we added medical equipment supplier BDX last week, but we think our patience could be rewarded. If the stock can hold support tomorrow and then make a move through today’s intra-day high of $37.33 on decent midday volume of over 600,000, a sustainable rally could ensue that could eventually test the 52-week high of $39.25. This scenario could provide an excellent opportunity to enter new positions. One caveat, though, should the BDX drop below support at its 20-DMA, currently at $36.06, we would hesitate opening new positions. Furthermore, a down day tomorrow to this level could also trigger a sell signal according to the MACD, so consider opening new positions only on a move higher on strong volume.

Picked on February 11th @ $37.03
Change since picked +0.07
Stop Loss @ $34.50

February 18, 2001

This play started last week with an impressive move to a new high of $39.25. The subsequent profit taking towards the end of the week turned this play into a wash for the week. Health care stocks have been generally attracting investments due to their characteristic of being able to maintain earnings despite an economic slowdown. Quality healthcare is one of the services that people are willing to pay for even if they are feeling the pinch of a potential recession. BDX is a leading supplier of medical equipment and general supplies. Demand for the particular products that BDX supplies is likely to steadily continue, which makes investment in the company's stock a relatively "safe" play. The profit taking in BDX appears to have abated, as the stock managed to stay above Thursday's low of $36.09 despite broad declines in the major stock indices. If we get some improvement in the overall markets next week, look for BDX to rebound and test the 5-DMA of $37.50. A close above this mild resistance might be a good opportunity to add to positions particularly if volume is over 1.2 million shares for the day. A decline on Tuesday below $36.00 would likely result in the triggering of a sell in the MACD. If this does occur, we would discourage putting on any new positions until the stock can prove that it has ceased its short-term decline. The Money Flow and OBV are both noticeably strong, pointing towards a longer-term bullish bias for the stock.

Picked on February 11th @ $37.03
Change since picked -0.27
Stop Loss @ $34.50