One biopharmaceutical player that insiders are loading up on here is Theravance (THRX), which engages in the discovery, development, and commercialization of small molecule medicines primarily for therapeutic areas of respiratory diseases, bacterial infections and central nervous system pain. Insiders are buying this stock into strength, since shares are up by 11% so far in 2014.
Theravance has a market cap of $4.3 billion and an enterprise value of $4 billion. This stock trades at a premium valuation, with a forward price-to-earnings of 129.42. Its estimated growth rate for this year is 26.9%, and for next year it's pegged at 125.4%. This is a cash-rich company, since the total cash position on its balance sheet is $520.50 million and its total debt is $287.50 million. After you back out the debt, Theravance has a total of $233 million of cash on its books.
A beneficial owner just bought 342,229 shares, or about $12.85 million worth of stock, at $37.55 per share.
From a technical perspective, THRX is currently trending above both its 50-day and 200-day moving averages, which is bullish. This stock has been uptrending strong over the last few weeks, with shares moving higher from its low of $34.50 to its recent high of $40.65 a share. During that uptrend, shares of THRX have been consistently making higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of THRX within range of triggering a big breakout trade.
If you're bullish on THRX, then I would look for long-biased trades as long as this stock is trending above its 50-day at $36.82 and then once it breaks out above some key overhead resistance levels at $40.65 to its 52-week high at $42.96 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 volume of 947,556 shares. If that breakout hits soon, then THRX will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $50 to $55 a share.