A Healthcare Stock Breaks Out Toward 525% Gains

A Healthcare Stock Breaks Out Toward 525% Gains
By Ann Sosnowski, Diligent Investor

Over the last year, the SPDR Select Sector Health Index (XLV) has stood still. And as the above chart shows in gold color, the XLV has actually dropped more than 8.66% from just the beginning of 2008.


But this doesn’t mean that the healthcare industry is full of terminally ill stocks.


One of the most promising companies on my radar right now is in the healthcare industry, where you can find many undervalued opportunities that could prove profitable in a recession.

This healthcare stock is riding on the most important demographic of our lifetime: the baby boomer generation.


Compared to the XLV, this stock is in a breakout pattern, meaning it’s poised to start investors on the road to 525% gains.


Back in June and July 2007, this stock showcased a double-top formation, a bearish indicator, which wiped away 40% of the stock’s value. After correcting, it’s rising again and has already broken out above its latest flat-line run around $8 per share.


Interestingly enough, that support line at $8 per share is the stock’s 50% Fibonacci retracement. In the past, this support was used to launch the stock almost 100% in a matter of months.


With a merger about to be approved that could give this company a monopoly on bone implants around the world, as well as low debt compared to cash on hand and a whopping quarterly revenue growth of 33.60%, this could be your only chance to get in at the low point of a healthcare stock that will inject safety into your portfolio… and give you 525% gains.


Ann Sosnowski
Editor, Diligent Investor

How to Build a 6-Figure Bank Account with just $25‏

Government Restricts Ads for"U.S. 801(k) Plans"Because they could make 401(k)sand IRAs Obsolete

Don't be surprised if you've never heard about America's best-kept moneymaking secret...

That's because this secret enables ordinary Americans to reliably collect huge sums of money – $50,000... $75,000... even $100,000 or more – beginning with as little as $25.

Sound too good to be true? It's not.

I call them "U.S. 801(k) Plans" because as you'll see, they are capable of making you twice what a typical "401(k) plan" can generate.

For Americans at or near retirement age, it's a dream come true.

Consider the case of William and Janice Hopple, for example...

Back in the mid 90s, the Mechanicsville, PA couple was struggling to make ends meet for their rapidly approaching retirement.

"We didn't have the money," recalls Janice Hopple, a 55-year-old homemaker. "We had just finished putting our three sons through college."

Then, a friend told them about how they could retire rich, starting with as little as $25.

So, beginning with $122 in 1995, the Hopples collected nearly $100,000 in retirement savings. And it's still growing.

Even better, they're making 1,000% to 2,000% more than they'd make with 401(k)s or IRAs (or pretty much any other retirement option out there). And in case you're wondering, they can access this money whenever they wish. Penalty-free.

Of course, the Hopples aren't the only ones taking advantage of this amazing secret:

• $250 into $19,981 – Recently, the Rousseau family of East Hartford, CT got in on what I call "U.S. 801(k) Plans" with only $250. Already, their tiny grubstake has grown to the tune of $19,340. It's growing bigger everyday.
• $166 into $84,766 – 63-year-old Percy Schwartz of Clinton, NJ amassed an $84,766 fortune starting with just $166 thanks the "U.S. 801(k) Plan" secret.
• $1,842 into $8.1 million – 101-year-old Andrew Canter from New York City turned a $1,842 stake into over $8 million using the "U.S. 801(k) Plan" secret.

You might be wondering how such an incredible investment opportunity could remain so secretive...

Well, the answer is, even though they're perfectly legal and supported by many of America's biggest corporations, the government began to restrict the advertising of "U.S. 801(k) Plans" to the public almost as soon as they got started (I'll explain why in a minute). So most folks have no clue they even exist.

While the government has done its best to keep this unique investment opportunity under wraps, it hasn't been able to stop some in-the-know financial journalists from revealing the details:

• Robert Luke, who does financial research for the Atlanta Journal-Constitution says of "U.S. 801 (k) Plans," "Building substantial wealth by investing as little as $25 at a time isn't a pipe dream."
• MarketWatch calls this opportunity, "The best-kept secret on Wall Street."
• Laura Casteneda, of the San Francisco Chronicle found that, "It's almost impossible not to make money..."
• Porus P. Cooper, journalist for Philadelphia Inquirer writes that "801(k) Plans," "...will provide retiring baby boomers a stream of income..."

Gold-Stock Indicator

My Favorite Gold-Stock Indicator Says Buy

By Dr. Steve Sjuggerud

John Doody set out to find the best newsletter about gold stocks...

He simply wanted an advisory that compared what you pay (the stock price) to what you get (the gold in the ground).

It turned out, what he was looking for didn't exist. So in 1994, he started his own letter, Gold Stock Analyst. His idea was right on... His top 10 list has averaged 30% a year since he started his letter!

John discovered an extremely high correlation between the price of gold and the performance of the major gold stocks. And he devised a simple – but very effective – method for determining whether gold stocks are cheap or expensive.

The relationship is simple to understand, too... When the price of gold is less than about $400 an ounce, gold stocks are nearly worthless, because it costs more to mine the gold than it's worth. But for every dollar the price of gold rises above the cost of production, gold stocks go up in value even more.

This is actually the reason you own gold stocks... They can go from worthless to outrageous values. They give you great leverage to the price of gold.

For example, let's say it costs Newmont Mining (NEM) – the world's second-largest gold producer – $400 to mine one ounce of gold. When gold is above $900 an ounce, like it is now, Newmont is incredibly valuable... You're talking roughly 100 million ounces of gold reserves with a potential profit of more than $500 per ounce. (That's $50 billion in potential profits in the ground!)

But when gold is below $400, as it was not that long ago, Newmont isn't worth anything. Okay, it's worth a few bucks, for hope. That's it.

The thing is, since the beginning of 2005, the price of gold has more than doubled from just over $400 an ounce. But the price of Newmont Mining is only up about 20%. Other major gold companies, like Barrick (ABX), have doubled in line with the price of gold.

But gold stocks are supposed to do better than this... The reason people buy gold stocks is for leverage to the price of gold. Meanwhile, these two big stocks are plodding along, at pace with or even slower than the rise in gold's price.

According to the January issue of John's letter, Barrick was trading at a stock market value of $253 per ounce of proven and probable gold reserves. And Newmont was trading at $233 per ounce. These are very cheap prices...

According to John's model, at these values, Barrick and Newmont are trading as if the price of gold were $650-$700 per ounce.

I talked to John on the phone about this last week. He told me, "Whenever the majors get to be double-digit percentages away from the line, they typically move back in line soon after."

Take a look...


There are two ways the majors can get back in line... Either gold stocks can soar in value, or the price of gold can fall. (Or we could see a little of both.)

The chart tells the story. (I took it from John's free issue on line. It covers from 2001 to early 2007 and I extrapolated it out to the present.) The bottom value on the chart is simply the price of gold. And the left axis is the market value per ounce of gold of the major gold companies.

Gold stocks are trading at a double-digit percentage discount to where they should be. The price of gold has soared. It's literally off the charts from John's 2007 version. But gold stocks haven't done what they should.

I expect this relationship will return to "normal." It either means gold will crash by $200 an ounce... or the major gold stocks will roar higher. Take your pick... but the bottom line is gold stocks are cheap relative to the price of gold.

Good investing,

Steve