EarningsBeats.com Digest for July 17, 2020
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Dear Digest Subscriber,
Join Chief Market Strategist Tom Bowley for our timely Q2 Earnings Season webinar on Monday, 7/20 at 4:30pm eastern. Just click below to learn more.
Price and Volume Suggest Higher Prices Ahead for This Medical Stock
I understand the hesitation to buy a stock after it's made a huge run, but sometimes Wall Street simply was wrong about a stock's potential and institutions scramble to buy, buy, and buy some more. Also, the COVID-19 pandemic has created opportunities for companies positioned for growth there. I believe that both are the case with GenMark Diagnostics (GNMK), which is now a $1.24 billion medical equipment company after its price shot up
six-fold from March through early-July. Roughly a week ago, GNMK raised its revenue guidance from $31 million to $40 million for the current quarter. While those numbers are small compared to most companies we watch, a 30% upward revision is nothing to ignore. Here's the chart reflecting a recent longer-term breakout and massive accumulation (volume):
The breakout in medical equipment stocks will likely mean more money rotating into this group during the summer. We're already seeing the relative strength line of the group vs. the S&P 500 turning higher again within a longer-term relative strength uptrend. Companies like GNMK are health care leaders and should benefit from increased rotation into the sector. On Monday, we will be unveiling the latest of our research products for our
EarningsBeats.com members, our Raised Guidance ChartList. We have begun tracking companies that raise guidance, similar to GNMK, so that our members have the best information to make informed investing and trading decisions.
Happy trading!
Tom Bowley
Chief Market Strategist
EarningsBeats.com
Better Timing. Better Trades.
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