One biotechnology and drugs stock that insiders are snapping up here is Lexicon Pharmaceuticals (LXRX), which is focused on the discovery and development of breakthrough treatments for human disease. Insiders are buying this stock into some big strength, since shares are up over 60% so far in 2012.
Lexicon Pharmaceuticals has a market cap of $1.03 billion and an enterprise value of $821 million. This stock trades at a steep valuation, with a price-to-sales of 858.99 and a price-to-book of 4.09. Its estimated growth rate for this year is 35.3%, and for next year it's pegged at 13.6%. This is a cash-rich company, since the total cash position on its balance sheet is $231.08 million and its total debt is 24.19 million.A director and beneficial owner just bought 3 million shares, or about $6.75 million worth of stock, at $2.25 per share. From a technical perspective, LXRX is currently trending above its 200-day moving average and below its 50-day moving average, which is neutral trendwise. This stock has recently pulled back from $2.75 right to its 200-day at $2 a share. So far, LXRX has held above its 200-day moving average. If you're bullish on LXRX, then I would look for long-biased trades once it manages to break out above some near-term overhead resistance levels at $2.20 to $2.37 a share with high volume. Look for a sustained move or close above those levels with volume that hits near or above its three-month average action of 1.1 million shares. If that breakout triggers soon, then LXRX will set up to re-test or possibly take out its next major overhead resistance levels at $2.76 to $3.28 a share.
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