Bristol-Myers and Quidel to Open Near 52-Week Highs

Health care companies Bristol-Myers Squibb (NYSE: BMY) and Quidel (NASDAQ: QDEL) reached new 52-week highs of $32.75 and $17.21 per share, respectively, in Wednesday's trading session.

Bristol-Myers saw its price target boosted by a Bank of America/Merrill Lynch analyst yesterday on belief that its Yervoy product would drive growth in the coming quarters. Revenue growth is expected from the October 27 report. Products of this New York-based global biopharmaceutical company also include Plavix and Abilify. Founded in 1887, Bristol-Myers now has a market cap of $53.8 billion.

The price-to-earnings ratio is higher than the industry average, but so is its operating margin. The return on equity is 20.7% and the dividend yield is 4.0%. Ten of 21 analysts consider it a Buy; none rate it a Sell. The share price is more than 21% higher than six months ago. The stock has outperformed competitors Pfizer (NYSE: PFE) and Merck (NYSE: MRK) over that time.

Quidel recently signed a distribution agreement with Life Technologies (NASDAQ: LIFE) and it won the European CE Mark for its new virus test for human metapneumovirus infection. San Diego-based Quidel is a leading diagnostic test solutions provider, marketing its products in the U.S., Europe, Japan and the Middle East. Its market cap is $564.9 million. It was founded in 1979.

Earnings per share are anticipated to grow 17.5% over the next five years. EPS for this year are forecast to have swung to a profit while revenues are estimated to be 39.9% higher year over year. Five of ten analysts rate the stock a Strong Buy. The share price is nearly 40% higher than six months ago. Over that time, the stock has outperformed competitor Alere (NYSE: ALR).

Action Items:

Bullish: Traders interested in exchange traded funds holding Bristol-Myers might want to consider the following trades:

• PowerShares Dynamic Pharmaceuticals (NYSE: PJP): up more than 15% in the past year
• iShares Dow Jones US Pharmaceuticals (NYSE: IHE): up more than 8% in the past year
• Health Care Select Sector SPDR (NYSE: XLV): up more than 5% in the past year

Bearish: Or traders might want to consider this alternative position:

• ProShares UltraShort Health Care (NYSE: RXD): up more than 21% in the past quarter

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