Questcor Offers Value, Income and a PowerRatings Buy Signal
Quesctor Pharmaceuticals (NASDAQ: QCOR) has increased sales from $115 million in 2010 to more than $760 million in the past twelve months. Despite the rapid growth, QCOR trades with a P/E ratio of 12 and offers a yield of 2.0%. The low valuation is probably due to the fact that skeptics question the sustainability of the revenue, which is derived from one drug. Treatment with QCOR’s flagship drug can cost more than $100,000 a year and the skeptics argue there are possible alternatives that could take market share from QCOR.
Concerns over competition and changing insurance policies combined to push the stock down 30% from its August highs and it is now oversold according to PowerRatings.
PowerRatings are based on the relative strength or weakness of particular stocks or ETFs. The higher the rating, the greater the one week historical gain has been for stocks and ETFs with that rating. For best results, enter these trades with a limit order 3-7% below the previous day’s closing price. Higher % limit entries have historically shown a greater percentage of winning trades but higher % limit orders also reduce the chance of trade execution.
In the past, buying stocks with a rating of 10 on a 3% pullback the next day and selling five days later has been profitable 75% of the time. The average winner has gained 5.9%. Other entries and exits also show high winning percentages and large average gains.
QCOR will start today’s trading with a PowerRatings of 10.
QCOR should be considered a potential buy under $50.14.
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All data is as of the end of day on 12/9/2013.