Bristol-Myers Squibb Company - BMY - close: 26.41

Company Info

Why We Like It:
In times of market stress the drug and healthcare stocks used to be considered "safe haven" trades. That hasn't always worked out but recently shares of BMY have been holding up pretty well. In early March the stock rallied higher and broke through some key resistance levels. Now shares appear ready for a new leg higher in spite of the market's recent volatility.

I am suggesting bullish positions now or you could wait for dips into the $26.00-25.75 zone although $26.00 and the 200-dma should offer support. BMY does not move very fast. It could take several months before shares hit resistance at $28.00 and longer for BMY to hit our final target at $32.00. Investors might want to consider turning this trade into a calendar spread or vertical spread to maximize its potential.

NOTE: Cautious investors may want to avoid launching any sort of bullish positions right now, especially if the market does see a breakdown this week.

- Suggested Positions -
(we will fill in the entry price on Monday)

Mar 14, 2011 - entry price on BMY @ xx.xx, option @ x.xx
symbol: BMY1221A27.5 2012 JAN $27.50 call -
current bid/ask $ 1.12/ 1.16

- or -

Mar 14, 2011 - entry price on BMY @ xx.xx, option @ x.xx
symbol: BMY1319A27.5 2013 JAN $27.50 call -
current bid/ask $ 1.67/ 1.77

Chart of BMY:

Current Target: $32.00
Current Stop loss: 24.95
Play Entered on: 03/14/11
Originally listed in the New Plays 03/12/11