New Buy:(UTHR)

I stepped back into the market today with a purchase of (UTHR) on it's breakout with an earnings beat announced this morning.

This rally is new and could end tomorrow depending on the jobs number, so I've assumed some risk there, but the stock itself has a lot of the qualities I'm looking for: small float, relatively high short interest, triple digit earnings growth and large estimates for the future, leading relative strength and a strong group. Add to that a breakout on 3 times normal volume on a day when the market was down and the stock looks pretty strong.

I'm really not a big fan of biotechs, feels like roulette to me, one lawsuit or dirty look from the FDA and the stock can get creamed. Nonetheless, I couldn't ignore the strength of this group, and I like that UTHR is a first stage base (it formed it's cup pattern during the current bear market) and has made a new high with the breakout - no overhead resistance.

There were also a number of bullish characteristics in the chart formation, including several occurrences of tight closes over a number of weeks - I learned in 'The Successful Investor' that this is a positive feature.

Just the same, this is a new rally in a bear market so I've got a very tight stop, around 3% below my buy point. I don't see any reason to risk more capital than that now - if the market or the stock turn south I want to get out quickly with minimal loss of capital.

-Geoff