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| GELX - Geltex Pharmaceuticals | Week Ended: 12/16/00 |
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| Price |
47.50 |
P/E Ratio |
100 |
52 Week High |
61.38 |
| Last Week |
+ 6.38 |
Earnings Date |
1/16/01 |
52 Week Low |
10.00 |
| Picked At |
57.13 |
Date Picked |
12/5/00 |
Sector |
Healthcare |
| Activity |
| Current |
47.50 |
Open |
47.81 |
Change |
-5/16 |
| Low |
47.50 |
High |
47.81 |
Volume |
75,900 |
ZACKS | NEWS | PROFILE | HISTORICAL PRICES | OPTIONS | D-CHART |
| Company Description Geltex Pharmaceuticals is developing non-absorbed, polymer-based pharmaceuticals that selectively bind and eliminate target substances from the intestinal tract. For the 9 months ended 9/30/00, total revenue totaled $36.9M, up from $6.2M. Net income totaled $8.5M vs. a loss of $26.6M. Results reflect increased contract revenue due to a $20M milestone payment from Sankyo Pharma earned upon the receipt of marketing approval from the FDA for WelChol.
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| Play Description December 10, 2000
Blowing through upper resistance at $60, GELX bucked the trend of a mostly flat AMEX Pharmaceutical Index (DRG.X) and closed at a new all time high of $61.25. We believe that if volume can remain at present levels (1.6 million shares or better), then the stock has a good chance of advancing even further. With that said, we’ll look for GELX to face its next opposition at $65 and further up at $70. Generally, when a stock is trading in new territory it tends to react to prices in five dollar multiples, which is why we’ve mentioned the $65 and $70 levels. A strong advance and close above each of these resistance points will signal additional entry levels. The $60 mark will now stand as the initial support base. A stronger base should form at previous highs near $57 and $56, which is bolstered by the 10-dma of $56.10. Set stops at $52 to protect against a reversal in trend. Lower risk entry points might present themselves if good mid-day volume (250k shares or more) can accompany a bounce off these support levels. Please check our Current Play section for adjustments in the stop level if GELX continues its run.
Picked on December 5th @ $57.13
Change since picked +4.13
Stop Loss @ $52.00
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| Update December 12, 2000
A sharp drop in GELX shares may be explained by the company’s pending merger agreement with Genzyme General (GENZ). Under the terms of the agreement, GelTex shareholders can elect to receive 0.7272 of a share of Genzyme General common stock or $47.50 in cash for each GelTex share owned. We believe that the recent valuation above the $47.50 mark may be the best explanation for Monday’s $13.25, which annihilated our $52.00 stop. Interestingly, GELX did not issue a press release explaining the decline, so the potential merger is the best explanation we can find.
Picked on December 5th @ $57.13
Profit/Loss = -9.19 (-16%) (Stopped out Monday @ $47.94)
Best Profit = +4.25 (+7%)
Stop Loss @ $52.00
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