Dear Mr. Berko: We are in our early 50s, and our account is worth $708,000. We haven’t added any more money, and it’s nearly doubled in value in 11 years, and we thought we were on the right road, but we recently realized that the stock market has done much better. So we talked to our stockbroker, who’s been honest in dealing with us. We want to be more aggressive rather than own the bland but good stocks he buys for us. He reluctantly suggested that we invest $5,000 in each of the following drug stocks: Mallinckrodt, Accelerate Diagnostics, Globus Medical, Zoetis and SciClone Pharmaceuticals. My wife and I would appreciate your thoughts on each issue.
— J.L., Portland
Dear J.L.: I suspect that some of your friends have been bragging about how well they’ve done in the stock market since Donald Trump was elected. Those steady-Eddie stocks have given you a comfortable 6.8 percent average annual return in the past 11 years. That’s acceptable. If you won’t stay the course, that road could have some sharp turns, and the midden could hit the windmill. Still, I’ve little objection to owning 100 shares of each of those five companies.
• I can’t pronounce Mallinckrodt (MNK-$45), which has $4 billion in revenues and is a global specialty biopharmaceutical company. MNK develops, manufactures and sells specialty pharmaceuticals, biopharmaceuticals and nuclear imaging agents. Its recent acquisition of Stratatech, a maker of human skin graft products, should prove valuable. Stratatech dovetails with MNK’s strategy of investing in under-resourced therapies so they can reach full potential. Buy it.
• Accelerate Diagnostics (AXDX-$28) is a $250,000-revenue in vitro diagnostics company providing solutions to bring about extremely rapid diagnoses of serious infections. The increase in resistance to antibiotics because of misuse and overuse is among the most serious health threats of our time. And sadly, too many diagnostic results can take several days to complete. AXDX’s recently patented platform technology addresses these challenges. It delivers accurate results from tests of infectious pathogens, which usually take days to complete in a lab, in a matter of minutes or hours, while the patient is still on the operating table. Revenues and earnings are expected to soar. Buy it.
