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Genzyme (GENZ) saw its shares break out last week from $62.5 to over $68 on higher than average volume. The weekly chart below demonstrates this movement and its significance as it broke a long term trend of lower highs that started in 2005.

This move was catalyzed by the October 4th vote by Bioenvision (BIVN) shareholders to decide the fate of the sale of the company to Genzyme. In addition, on Friday, Genzyme announced approval of Elaprase, its enzyme replacement therapy to treat Hunter syndrome. The company is seeking approval in other countries as well.

I believe this latest strength should be considered a great buying opportunity. The stock had a strong move last week and may move sideways for some time but the charts signal a breakout and the stock should move towards new highs. I have previously mentioned the low historical valuation of GENZ which was trading at 15.9 times 2008 earnings (click here to see that article). I anticipate $80 price per share within 3-6 months.

Bottom line: Buy GENZ for the short and long term potential.

Disclosure: The author has a long position in this stock.

Source: Genzyme Breaks Out On Good News