A Half-Dozen Charts Make Medical Equipment Group One To Watch
A number of stocks in the medical equipment industry group are tracing bullish patterns, making the group one to watch closely. The group itself has been a market leader, ranked in the top 30 of 197 IBD groups for several weeks. Investors will find in it an attractive mix of stocks in buy range or still forming bases. Cantel Medical ( CMN ) is forming a base-on-base pattern with a 72.79 buy point. Shares have behaved well, making relatively small price fluctuations each day as they form the base. That’s considered a strong foundation, and suggests that the stock won’t have problems forming the rest of the pattern. Despite softening earnings growth (up 17% to 42 cents a share in the latest quarter), the maker of equipment to prevent and control infections in hospitals and other medical facilities still has one of the highest EPS Ratings of 32 companies in the group. It gets a 95 EPS Rating out of a maximum 99 from IBD Stock Checkup . Intuitive Surgical ( ISRG ) is rising from a pullback to the 10-week moving average. That makes it the first follow-on buy area for the stock since it broke out of a base in March. (In a follow-on area, investors add a smaller number of shares than the number they acquired on a breakout.) With strong Relative Strength and Accumulation/Distribution Ratings, the stock has a better chance to keep rising. The main risk for Intuitive Surgical and any other stock is the market, which can quickly obliterate even the best charts. How do you quickly check Intuitive’s proprietary IBD rankings? Go to Stock Checkup. Cynosure ( CYNO ) also is finding support at the 10-week average, but the stock is barely rising from that level. The company’s noninvasive fat-reduction system is driving growth. Masimo ( MASI ) broke out of a saucer base May 5 and is still in buy range from the 46.10 buy point. The breakout was nearly flawless: Shares surged 8% in nearly five times average volume as the company’s earnings topped estimates. Although shares closed below the buy point on the day of the breakout, it didn’t stop Masimo from advancing. Masimo makes equipment to monitor body functions, and has developed technology that can test blood without having to draw it by needle. Idexx Laboratories ( IDXX ) is at new highs. A long-term chart shows the stock is in buy range from the 84.35 buy point of a base more than a year in length. Another entry could be identified at 78.59. The maker of veterinary diagnostic equipment went to new highs after it reported results April 29. Idexx raised its full-year sales and profit guidance, citing success with new products and its strategies. Idexx has a lower EPS Rating than many other companies in the group, yet the market has cheered its outlook. Nevro ( NVRO ) is one of the newest stocks in the group, having gone public in November 2014. Shares have made quite a climb from the IPO price of 18 a share, and now are near a potential buy point at 70, from a cup-with-handle base. As a startup, Nevro has not made a profit yet and analysts expect losses this year and next. Investors seem to be drawn to the company’s fast sales growth, including a 114% spike in 2015 sales to $70 million. Redwood City, Calif.-based Nevro specializes in spinal cord stimulation systems to treat pain.