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Boston Scientific - BSX - cls: 29.05 chg: -1.70 stop: 31.51

Company Description:
Boston Scientific is a worldwide developer, manufacturer and marketer of medical devices whose products are used in a broad range of interventional medical specialties. (source: company press release)

Why We Like It:
We like BSX due to its long-term and short-term weakness. The stock has been suffering under a trend of lower highs for almost a year. The current downtrend began after BSX peaked near $46 a share. Since then investors have been selling the rallies. Short-term the action looks bearish as well. BSX has been stuck under resistance near the $31.00 level for all of April and the brief spike over $31 today was quickly sold. The company announced Q1 earnings today and the results were inline with expectations. Looking at the numbers one would think Wall Street would be happy. BSX reported very strong sales growth. Unfortunately, during the conference call management said growth would slow down to a more normal pace. Analysts are also worried that BSX is suffering against stiff competition in the stent market. Rival Johnson and Johnson (JNJ)'s Cypher stent is still less expensive and strong rival for BSX's Taxus stent. Short-term the stock looks bad technically too. Today's breakdown from its recent trading range was fueled by volume about twice the normal. The MACD indicator is rolling over into a new sell signal. The Point & Figure chart shows a quadruple bottom breakdown sell signal with a $22 price target. Looking at both the daily and weekly chart we see significant support at the $28.00 level but this time we suspect that BSX will break down through the $28 mark. Our target is the $25.00-24.00 range. Our time frame is six to eight weeks.

Picked on April 19 at $29.05
Change since picked: - 0.00
Earnings Date 04/19/05 (confirmed)
Average Daily Volume: 5.4 million
 

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