During the Lightning Round segment of Mad Money Thursday night one caller asked Jim Cramer about Vertex Pharmaceuticals Inc. (VRTX) : "Wall Street underestimates this stock," said Cramer. Let's check and see how VRTX might surprise the sell side.
In the daily bar chart of VRTX, below, we can see that the stock price turned up strongly from early October when the broad market started its fourth-quarter rally. Prices pulled back toward the rising 50-day moving average line in early January in what looks like a buying opportunity. Prices are above the rising 200-day moving average line and maybe even extended above it.
The trading volume has been stronger since the middle of October telling us that more traders and investors have been attracted to the stock. The daily On-Balance-Volume (OBV) line started its rise in early October and tells us that buyers of VRTX have been more aggressive.
The Moving Average Convergence Divergence (MACD) oscillator gave a go long signal in late October when it crossed above the zero line. Another buy signal could be seen in early February if this stock keeps rising.