Diamonds and Dogs

1/27/16

Biogen is back. Biogen (BIIB) is jumping 8% following strong earnings thanks to better than expected sales of its treatment for multiple sclerosis.  The company is forecasting 2016 revenue forecast of $11.1 billion to $11.3 billion assumes no price increases for its key multiple sclerosis drugs -- Tecfidera, Avonex, Tysabri and Plegridy. After last year, when biotechs came under fire for their constant price hikes, a price halt for their more popular drugs seems to be a win for patients and shareholders. With the stock down 40% from the 2015 highs now trading for 15 times earnings, Biogen looks like an attractive long term buy.

Flight delay at Boeing. Boeing (BA) is getting hit today down 6%, falling as much as 10% this morning to a new 52 week low after the company lowered guidance for 2016. Boeing cut production by one plane per month for their 747 jumbo-jet. Earnings will now be flat year over year, but the long term bullish case is still intact.  Cash flow remains strong jumping to over $10 billion in 2016. With the stock near its 52 week low, the company can now resume thier share buyback plan at prices 15% below December levels. Analysts expect growth to resume in 2017, but unfortunately in the short term, the stock may be stuck on the tarmac for a while.