Wednesday, December 23, 2009

Bookkeeping: Restarting Myriad Genetics (MYGN)

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Now that the healthcare lobby Congress is putting the finishing touches on healthcare reform, we've seen healthcare stocks take off the past few weeks.  [Dec 14, 2009: There is Always a Bull Market Somewhere] This "reform" has all the hallmarkes of a wonderful success for the industry, $600M of lobbying dollars generating massive ROI (Return on Investment) for a few decades to come... the main punishment seems to have been doled out to the tanning industry with a 10% tax.  What a country.

Anyhow, we are very underexposed to healthcare since we like 20%+ type of growth and only so many companies can provide it.  We've had a few ventures with Myriad Genetics (MYGN) the past 2.5 years, some successful - some not.  The stock has just broken out from below some resistance areas so I am going to give it another shot, with a 2% allocation around $25.60.  We last closed out a position in Myriad in early November about a dollar lower than this level - so we have not missed much.

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The stock has bow broken over the 50 day moving average after going sideways for much of the past 2 months, we'll use the 20 and 50 days as new support levels / stop out levels.  If it can continue to move, it should have relatively clear sailing until running into the 200 day moving average up near $28 (and falling)

With earnings of $1.45 (est.) for year end Jun 2010, the forward PE is under 20, for a 20% type of grower.  The stock has simply been in the doghouse for much of 2009, unlike its superstar status in 2008.  Hopefully ti can catch some mojo in 2010.

[Jan 20, 2009: Myriad Genetics - Another Diagnostic Heavy Hitter]

Long Myriad Genetics in fund; no personal position


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