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A stock in the retail drug complex whos insiders are buying up a large amount of stock in is
CVS Caremark(CVS - Get Report), a pharmacy healthcare provider in the U.S. Insiders are buying into some mild strength here since this stock is up over 9.4% in 2012.
CVS Caremark has a market cap of $57 billion and an enterprise value of $66 billion. This stocks trades at a cheap valuation, with a trailing price-to-earnings of 17 and a forward price-to-earnings of 12. Its estimated growth rate for this year is 16.8%, and for next year it's pegged at 12.5%. This is not a cash-rich company, since the total cash position on its balance sheet is $1.42 billion and its total debt is a whopping $10.01 billion.
A vice president just
bought 46,400 shares, or about $1.99 million worth of stock, at $42.99 per share.
From a technical perspective, CVS is currently trading above both its 50-day and 200-day moving averages, which is bullish. This stock broke out above $39.15 to $39.26 a share a few months ago on huge volume. Since triggering that breakout, this stock has uptrended strong towards its current price of $44.50 a share.
If you're a bullish on CVS, then I would look for long biased trades as long as this stock is trending above $44 a share, and the upside volume is tracking in strong. If this stock were to trade back below $44, then I would look for long setups near the 200-day moving average of $42.97 or the 50-day moving average of $41.36 a share. I would avoid any long trades in CVS if the 50-day and 200-day were violated with big volume.
CVS, one of
Warren Buffett's holdings, shows up on lists of
8 UBS Stock Picks for 2012 and
3 Health Care Buys for 2012.