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Another name that insiders are snapping up a large amount of stock in is biotechnology and drugs player
Halozyme Therapeutics(HALO - Get Report), which engages in the research, development and commercialization of recombinant human enzymes that transiently modify tissue under the skin to facilitate injection of other therapies or correct diseased tissue structures for clinical benefits. Insiders are loading up on this stock into some mild weakness since shares are off by around 14% so far in 2012.
Halozyme Therapeutics has a market cap of $871 million and an enterprise value of $781 million. This stock trades at a premium valuation, with a price-to-sales of 16.05 and a price-to-book of 11.09. Its estimated growth rate for this year is -215.8%, and for next year it's pegged at 20%. This is a cash-rich company, since the total cash position on its balance sheet is $116.61 million and its total debt is zero.
A beneficial owner and director just
bought 1.1 million shares, or around $7.95 million worth of stock, at $7.35 to $7.50 per share.
>>22 Biopharma Stocks Poised for Breakouts
From a technical perspective, HALO is currently trading below both its 50-day and 200-day moving averages, which is bearish. This stock has been destroyed by the sellers in the last two months and change, with shares dropping from a high of $13.50 to a recent low of $7.71 a share. Shares of HALO also gapped down huge in mid-April from over $11 to $7.51 a share with monster volume.
If you're a bullish on HALO, I would look only look for long-biased trades if this stock can manage to trigger a breakout above some near-term overhead resistance at $8.45, and then above its 200-day moving average of $8.93 a share with high-volume. Look for volume on that move that's near or well above its three-month average action of 1,097,330 shares. If we get that action soon, then HALO can attempt to fill some of that gap and potentially trade back above $10 to $11 a share rather quickly. Keep in mind that in order for HALO to challenge that gap it also needs to clear its gap-down day high of $9.20 a share.
I would simply avoid HALO or look for short-biased trades if it fails to trigger that breakout, and then drops below some near-term support at $7.50 to $.7.17 a share with heavy volume. If those support levels are taken out with volume, then HALO could easily drop towards its next significant prior support levels at $6 to $5.50 a share.
Halozyme shows up on a list of
3 Stocks to Buy for Less Than What Insiders Paid.