IBD Healthcare Update

Went over the latest IBD and it looks like the healthcare has advanced according to IBD, however I am not willing to take it at strictly face value which I will explain. This week there is 11 healthcare-related industries within the top 25 a whopping 44% representation and they are:

#2 Medical/Dental-Services

#3 Medical-Ethical Drugs

#5 Medical-Genetics

#6 Medical-Systems/Equipment

#12 Medical-Health Maintenance Organizations

#13 Medical-Products

#15 Medical-Wholesale Drug/Supply

#16 Medical-Drug/Diversified

#17 Medical-Outpatient/Home Care

#18 Medical-Biomed/Biotech

#24 Medical-Generic/Drugs

This sounds and looks great on the surface, however here is my concern. I sometimes use the IBD 100 to help focus on some momentum stocks and have a set of criteria I follow with regards to overall stock rank and group ranking. Normally, I will have my steady performers who are always on the list in one form or another i.e. POT, ISRG, VIP etc...However this week there was a tremendous amount of new companies into my numbers on the order of +35%, which is not normal. I find during volatile times some companies make a big move one week, so they find themselves into my numbers, but drop out shortly thereafter.

So you may ask...How does this all tie into healthcare? Well, 8 of the 20 new entries are related to the healthcare industry, so I am a bit hesitant and have a gut feeling that there may be more "pain" to follow. Here are those new entries

1. Yamana Gold INC (AUY)
2. Blackrock (BLK)
3. American Public Education INC (APEI)
4. Omnicell (OMCL) (I do own shares of this company)
5. Flir Systems INC (FLIR)
6. Amedisys (AMED)
7. Energen (EGN)
8. Strayer Education (STRA)
9. Invitrogen (IVGN)
10. Icon Plc ADS (ICLR)
11. Covance (CVD)
12. Mechel Oao ADS (MTL)
13. Stericycle (SRCL)
14. Genzyme Corp (GENZ)
15. Berkshire Hathaway A (BRKA)
16. Kendle Intl (KNDL)
17. Apollo Group A (APOL)
18. Cellcom Israel Ltd (CEL)
19. Axsys Tech (AXYS)
20. Continental Res INC (CLR)

Healthcare According to IBD

Here are the latest statistics per the latest Investor's Business Daily. I have compiled the numbers for easier reading. IBD breaks down the marketplace into 197 various industry groups. The rankings are compiled based on price performance of all stocks in the industry in the latest 6 months and according to IBD studies show most top-performing stocks are found in the top quartile of groups and that group action determines at least half of a stock's performance.

Out of the top 30 industry groups, the healthcare industry comprises 33% of this list. The 10 industries making the list are:

#4. Medical-System/Equipment

#6. Medical/Dental Services

#7. Medical Genetics

#8. Medical-Ethical Drugs

#12. Medical-Health Maintenance Organization

#18. Medical-Products

#19. Medical-Wholesale Drug Supply

#23. Medical-Outpaitent/Home Care

#24. Medical-Drug/Diversified

#25. Medical-Biomedical/Biotechnology

In addition, the healthcare sector is up 1.87% YTD, while 18 individual stocks raked up new highs and no new lows, which I find a bit impressive with the market we have been having.