Amgen (NASDAQ: AMGN) is
a biotechnology firm engaged in the discovery and manufacture of human therapeutics. It markets products in the areas of supportive cancer care, nephrology, inflammation, and metabolic diseases. Principal offerings include anemia treatments Aranesp and Epogen, rheumatoid arthritis drug Enbrel, and white blood cell stimulator Neupogen. Amgen has marketing alliances with Hoffmann-La Roche and Kirin. Baxter International (NYSE: BAX), Johnson & Johnson (NYSE: JNJ) and Novartis (NYSE: NVS) and major competitors.
The company pleased the Street late last month, when it announced Phase 3 trial results showing that its experimental osteoporosis drug significantly reduced the risk of bone fractures in post-menopausal women. As well, the firm reported Q2 EPS of $1.14 and revenues of $3.76 billion. Both measures topped consensus Street estimates ($1.02, $3.58 billion). Management also guided FY08 EPS to $4.25-$4.45 ($4.19 consensus) and FY08 revenues to $14.6-$14.9 billion ($14.42B consensus). Eight brokerages subsequently declared AMGN a "buy" and issued price targets in the range $67-$80.
The stock 
popped on the news and then moved into a bullish "pennant" consolidation pattern. Prices frequently exit pennants moving in the same direction they were traveling on entry. In this case, that would be to the upside.
Brokers recommend the stock with two "strong buys", eleven "buys" and fifteen "holds". The AMGN Operating Margin (27.45%), Net Profit Margin (21.13%), Return on Assets (9.02%), Return on Investment (10.49%), Revenue per Employee ($846.72k) and Net Income per Employee ($178.91k) compare favorably with industry, sector and S&P 500 averages. Institutions hold about 77% of the outstanding shares. The stock is one of those used to calculate the S&P 100, S&P 500 and Nasdaq 100 Indexes. Over the past 52 weeks, it has traded between $39.16 and $64.00. A stop-loss of $55.20 looks good here.
Larry Schutts is a contributing editor for Theflyonthewall.com and the Vice-President of Stockwinners.com. He does not hold positions in any of the stocks mentioned above.
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