AstraZeneca share price is rising today after the company reported better-than-expected quarterly results yesterday. The shares are up by more than 1.13%, becoming the best performing in the FTSE 100 index. Other top performers are Unilever, Coca-Cola, and Rentokil Initial.
AstraZeneca news: AstraZeneca has been in the headlines a lot recently. For example, the company has been in the spotlight after South Africa discontinued testing of its new coronavirus vaccine. The country found the efficacy rate of the vaccine being about 25%, which is lower than the acceptable level. A further trial in the United States is set to conclude in the next few weeks.
This controversy has seen its stock drop by more than 8% in the past few weeks. Still, the vaccine will be a small part of the company’s business. In fact, it has said that it will not profit from it during the pandemic.
The firm is also acquiring Alexion Pharmaceuticals in a deal valued at more than $39 billion. This acquisition will give it a foothold in the rare diseases industry. Analysts at Hargreaves Lansdown wrote this about the deal:
“Over half of the price is being paid in shares. Prior to the deal’s announcement Astra shares were trading a PE ratio of 21.9, whereas Alexion shares traded on 9.4. Astra is buying lowly valued Alexion stock with highly valued stock of its own.”
In a report yesterday, AstraZeneca said that it made $26.6 billion in $26.6 billion in 2020, up by 10% in constant currency. This performance was mostly due to its oncology business, which has become a key part of the firm.
Turning to the four-hour chart, we see that the AstraZeneca share price dropped to a low of 7,191p in December. It then soared by more than 11% to 8,0009p in January. This month, the stock has retested the previous low at 7,191p.
In the past few days, it has formed a small channel pattern and is now at its upper side. The Relative Strength Index (RSI) has also started rising. Therefore, in my view, the current pattern resembles an inverted cup and handle pattern, and that the price is now at the handle zone.
As such, we cannot rule out another drop below 7,191p. If this happens, the next key level to watch will be 6,827
