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BDX - Becton, Dickinson and Co.Week Ended: 3/17/01
Price 33.03 P/E Ratio 25.81 52 Week High 39.25
Last Week + 0.15 Earnings Date 04/18/01 52 Week Low 21.75
Picked At 37.03 Date Picked 2/10/01 Sector Healthcare
Current 33.03 Open 33.20 Change -0.87
Low 33.00 High 33.84 Volume 711,500

Company Description

Becton, Dickinson and Company manufactures and sellsa broad line of supplies, devices and systems used by healthcare professionals, medical research institutions and the general public. For the 3 months ended 12/31/00, revenues fell 2% to $843.3M. Net income decreased 19% to $60.6M. Results reflect unfavorable foreign exchange translation, remaining inventory reductions at the trade level, and the discontinuation of certain distributor incentive programs.

Play Description

February 11, 2001

BDX is engaged in the manufacture and sales of a diverse array of medical products and systems. It has long been known to offer products of a superior quality. BDX outperformed the market last week after Lehman Brothers reiterated its “Strong Buy” rating on the company. Currently, Lehman Brother's year-end target price for BDX is $42.00 or 25.5 times expected 2001 earnings (fairly modest). The research firm also noted that an increase in sales due to new Federal safety requirements will likely come sooner than later because the compliance date for the new rules has been moved up to April 18th from August 1st. On Friday, BDX closed only a penny below a newly established 52-week high. A move above $37.04 may prove to be an excellent entry point for momentum traders. A run to resistance at $40.00, established in mid-1999, could occur quickly if the stock trades above $37.04. A bounce off support offered by the 10-DMA just below $36.00 may also prove to be a good entry point. The MACD is rising, which suggests the continuation of the positive trend. Money Flow is very strong and is establishing new highs, which also casts a positive light on the potential for more gains.

Picked on February 11th @ $37.03
Change since picked +0.00
Stop Loss @ $34.50


March 15, 2001

BDX suffered from some more profit taking and slipped below our stop of $34.50 on Wednesday. In our last report, we suggested that BDX was looking a little risky due to the stock's inability to stay above the 50-DMA of $35.00. It turned out that we were right.

Picked on February 11th @ $37.03
Profit/Loss -2.53 (-7%) (Stopped on Wednesday @ $34.50)
Best Profit +2.25 (+6%)

March 13, 2001

BDX has been relatively ignored the past two days during the market's wild gyrations. Health care stocks have been generally outperforming the market this year due to their recession resistant nature. They've also been attractive because of their relatively low valuations. As for BDX, we are a little bit concerned because the stock closed just slightly below its 50-DMA of $35.06 today. What's more, the OBV and Money Flow are still strong but appear to be moving sideways after a long-term ascent. The bottom line is that BDX needs to make a positive move, perhaps as soon as tomorrow morning, or else our stop at $34.50 will be executed. A reversal of the stock's mild pullback will likely be over if BDX can rally above its 50-DMA and its 10-DMA of $35.53. If this occurs tomorrow, we will become more comfortable with this position.

Picked on February 11th @ $37.03
Change since picked -2.05
Stop Loss @ $34.50

March 11, 2001

A solid line of general use medical products has helped to keep BDX's share price stronger than most during the market collapse at the end of the week. Banc of America initiated coverage of BDX last week with a "Buy" rating. This news further helped BDX to withstand some of the general selling pressure that many stocks felt last week. BDX remains a compelling play for us because the stock was able to test its 50-DMA of $35.00 and bounce higher. We are also encouraged by the fact that BDX managed to close above its 10-DMA of $35.72 on Friday. A positive opening on Monday could signal the continuation of a move that should eventually test the 52-week high of $39.25. The MACD is still negative but is definitely showing signs of rebounding. The OBV is very strong and is indicating that there is some been some solid buying of BDX during positive days. New entries could be considered on a bounce of the 50-dma or a rise through resistance at $36.50 on volume of at least 400,000 shares by midday.

Picked on February 11th @ $37.03
Change since picked -1.03
Stop Loss @ $34.50


Copyright 2001

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