Bill Gunderson

And over the last 12 months the stock is up 88%.

REGN has the performance. In fact it is one of those rare birds of a stock that earns an A+ performance grade. Now lately REGN’s momentum has been pretty good. The stock is up 88% like I said over the last 12 months. It currently earns a momentum grade of B+.

REGN could be a little bit stronger in this arena right now, but I bought the stock a while back and it remains strong enough for me to hang onto it.

Valuation

Next I like to look at the valuation of the shares in completing my Gunderson-grading process.

One could say that on the surface, a PEG ratio of 2.12 is pretty rich; REGN is trading at over two times its growth rate. But this is a stock that is expected to grow by 25% per year over the next five years.

Stocks such as these do not come cheap! Unfortunately you’re not going to be able to buy this stock at Bristol Meyers or Merck-like multiples. REGN is a premium stock.

Now I take REGN’s earnings estimates of $5.55 next year and extrapolate them out over the next five years and apply a reasonable multiple.

When I do this I come up with a stock that is considerably worth a lot more five years down the road than where it is trading at today. In my book, REGN gets a value grade of A.

Stock Chart

Lastly, before the Gunderson-grading process is complete, we must check to see how that all-important REGN stock chart is looking?

Not bad—REGN is in a nice uptrend!

Out of 3,575 stocks in my Best Stocks Now! app database, REGN comes in at #117.


Follow me on Twitter @billgunderson or on my website for a change in my opinion of the stock.


Bill Gunderson

Bill Gunderson is the CEO and Chief Market Strategist of Gunderson Capital Managment in San Diego, CA. He is also a professional money manager, former research analyst, author of Best Stocks Now. http://www.pwstreet.com