Seeking Alpha

PropThink's  Instablog

PropThink
Send Message
PropThink is an intelligence service that delivers long and short trading ideas to investors in the healthcare and life sciences sectors. Our Editorial Team is comprised of individuals with a strong background in science, medicine and the business of successfully commercializing therapeutics,... More
My company:
PropThink
My blog:
PropThink
View PropThink's Instablogs on:
  • Fundamentals And Technicals Continue To Support QCOR

    By Jake King

    Shares of Questcor Pharmaceuticals (NASDAQ:QCOR), despite a large short interest, have continued to perform well for shareholders and broke through several resistance levels this week to eclipse the $30 level on Wednesday. We noted at the beginning of December that shares could trade into the $30 range by year's-end, and investors are demonstrating that same confidence in QCOR. Two recent updates from the company - an accelerated dividend and expanding sales force, which is anticipated to grow by 30% - support our thesis that Acthar sales continue to grow and demonstrate management's confidence in the product's growth potential. We also noted in our last article that the QCOR short thesis has largely played out, as evidenced by the stock's quick rebound after a negative report in early December. Even flat growth for Acthar from levels in 3Q justifies a higher valuation for QCOR, and we've stated that based on fundamentals alone, the stock could move to the high-$30 or low-$40 range.

    Technicals in the near-term support a move higher as well, suggesting that investors should stay the course. With QCOR's recent break through of the $29.60 and $30.13 levels, the stock has room to run 10% up to $33.00, its next level of resistance. And with a run up through the $33.00 level, the 200-day SMA is the next level of resistance at $37.11. $35 would also represent a 50% retracement from the November 7, 2012 highs and the November 27 lows, indicating another level of resistance. Nevertheless, it looks as though the stock is going to take a run at the mid-$30 level, with shorts likely to cover positions as the year closes.

    Disclosure: I am long QCOR. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

    Additional disclosure: PropThink is a team of editors, analysts, and writers. This article was written by Jake King. We did not receive compensation for this article, and we have no business relationship with any company whose stock is mentioned in this article. Use of PropThink’s research is at your own risk. You should do your own research and due diligence before making any investment decision with respect to securities covered herein.You should assume that as of the publication date of any report or letter, PropThink, LLC and persons or entities with whom it has relation ships (collectively referred to as "PropThink") has a position in all stocks (and/or options of the stock) covered herein that is consistent with the position set forth in our research report. Following publication of any report or letter, PropThink intends to continue transacting in the securities covered herein, and we may be long, short, or neutral at any time hereafter regardless of our initial recommendation. To the best of our knowledge and belief, all information contained herein is accurate and reliable, and has been obtained from public sources we believe to be accurate and reliable, and not from company insiders or persons who have a relationship with company insiders. PropThink was not compensated to publish this article. Our full disclaimer is available at www.propthink.com/disclaimer.

    Tags: MNK, long-ideas
    Dec 19 12:59 PM | Link | 2 Comments
Full index of posts »
Latest Followers

StockTalks

More »

Latest Comments


Posts by Themes
Instablogs are Seeking Alpha's free blogging platform customized for finance, with instant set up and exposure to millions of readers interested in the financial markets. Publish your own instablog in minutes.