XLV gains 2.1%
The US markets began March on a positive note as the Dow Jones Industrial Average went up by 348 points and closed at 16,865, up by 2.1% on March 1, 2016. The S&P 500 also gained 2.4% and closed at 1,978.4. The markets moved up on better-than-expected ISM data, which indicated the February numbers at 49.5% (an increase of 1.3%) compared with the January numbers.
On March 1, crude oil also inched toward $35 per barrel. The biotech stocks also moved up along with the markets. The Health Care Select Sector SPDR ETF (XLV) gained 2.1%. However, it underperformed the SPDR S&P 500 ETF (SPY), which gave a return of 2.4% on March 1, 2016.
The above table provides the details of XLV, SPY, the top and bottom stocks with respect to returns at various intervals, price movements, and 12-month target prices according to the analyst estimates.
Leaders and laggards
Regeneron Pharmaceuticals (REGN) and Alexion Pharmaceuticals (ALXN) were the best performers within XLV, with returns of 6.8% and 7.1%, respectively. Regeneron closed at $410.21 and was trading above the 20-day moving average price of $392.02.
In its press release, Regeneron announced that “David Weinreich, M.D., M.B.A., has joined the company as Senior Vice President, Late Stage Clinical Development and Medical Affairs. Dr. Weinreich had more than 15 years of experience in drug development and was previously at Bayer Pharmaceuticals, where he served most recently as Senior Vice President and Head of Global Development for Specialty Medicine.” The move appears to be received favorably among the investors, and the stock gained 6.8%.
Regeneron is trading at a forward price-to-earnings (or PE) multiple of 25.3x. It has a book value of $34.92 and with its current price, the stock is trading at a price-to-book value (or PBV) of 11.75x. Regeneron has a weight of 1.2% in XLV’s portfolio.
On the other hand, Medtronic (MDT) fell by 4.1% after it announced its 3Q16 results. It posted revenues of $6.93 billion against the analyst estimates of $6.99 billion. The revenues were negatively impacted by the foreign exchange transactions to the tune of $344 million. MDT has a weight of 4.3% in XLV’s portfolio.