Boston Scientific Stock: Big, Bullish Breakout
NEW YORK (
) -- One of the most beaten-down stocks in health care is seeing a strong bullish move,
Boston Scientific
(BSX) - Get Report
.
Trading in the medical technology stock hit 38 million shares on Thursday, when the stock broke out strongly from a long-term trading pattern that had kept it near the $7 mark as a high point. Boston Scientific shares finished at $7.22 on Thursday and picked up right where they left off on Friday, rising by 5% to $7.57 in the afternoon, on trading of 25 million shares.
The Boston Scientific bullish break out put it on pace for its second consecutive day of doubling its average daily share volume on Friday.
There was no news of note about the company. The only news in the medical technology sector was an upgrade by Bernstein of Boston Scientific rival
Medtronic
(MDT) - Get Report
to a buy. Yet Boston Scientific was up twice as much as Medtronic on Friday.
The most recent news involving Boston Scientific was an anonymously sourced report that the company had decided to not sell its neuromodulation business. The neuromodulation business had long been rumored as a likely sale candidate as Boston Scientific seeks to shore up its balance sheet and pay off debt due in 2011.
Some analysts maintained throughout the neuromodulation was a core business and a sale would have been surprising. The anonymous reports saying Boston Scientific would not sell the business claim that the company believed suitors weren't offering fair value during deal talks.
Boston Scientific's last earnings report was considered a sign of its continued recovery from the mid-year recall of its defibrillator product which sank the med tech stock as low as $5.
Friday's share price in Boston Scientific was the highest since last March, before the recall.
The
Wall Street Journal
reported on Thursday that Boston Scientific rival
St. Jude Medical
(STJ)
was voluntarily removing an older defibrillator model from the market given fears that it might be vulnerable to malfunctions. St. Jude Medical shares didn't see any selloff as a result of the report of the defibrillator phase out.
Other potential reasons for the BSX run up are shorts suddenly running en masse to cover, or rumors of a takeout that normally stoke trading, or a strategic investor building a stake in Boston Scientific -- which has been poised for a "turnaround" ever since Ray Elliott took over as CEO in 2009 -- but there was no clear indication of why Boston Scientific was breaking out at the end of the week.
Several Boston Scientific stock watchers contacted by the
TheStreet
said there was no obvious reason for the sudden rally in shares.
-- Written by Eric Rosenbaum from New York.
>To contact the writer of this article, click here:
Eric Rosenbaum
.
>To follow the writer on Twitter, go to
.
>To submit a news tip, send an email to:
.