Medical Money

Ok, let’s break this baby in. RMD a mid cap medical equipment maker. This could be an excellent stock to short, and here'’s why: The WEEKLY CHART

• Stocks should trade with their MACD. The long blue line shows a big discrepancy. The MACD has been flat, the stock has doubled
  

• The long purple line is the trend line, which the stock recently broke
  

• The shorter blue line shows a more recent negative MACD correlation

(excuse the pixelated chart, I'm still working on how to fix it)

To save space and time I will refrain from showing the Daily chart, but it agrees with the weekly. Also, remember that the weekly chart is more important for a divergence this big.

I will give a few short opinions from analysts.

#1
3 Star Rating
High Risk
3 Star Value

#2
Opinion: AVOID - Date 07/17/06

#3
Value: RMD has a Value of $38.90 per share. It is overvalued compared to its Price of $45.47 per share.

#4
Financial Alerts:
6/26/06 RMD's P/E ratio well above industry average.

#5
Insider Trading: The COO sold almost all of his stock
http://moneycentral.msn.com/investor/invsub/insider/trans.asp?Symbol=RMD

The company reports earnings on Aug 17 so I would try to avoid holding the stock through earnings, since it did beat estimates by 5 cents last quarter. All in all, this should be an excellent Short Sell. If you want to be sure, give it some time to let it fully break the trend line.

Confidence Rating: 3/5 Stars