ESRX Inverse Head & Shoulders

We certainly like the stock here: Unlike most other pharmacy benefit management companies, Express Scripts — which boasts 50M members and a 58,000 retailer/pharmacy reach — is not controlled by a large pharmaceutical manufacturer or drug retailer. This freedom allows Express Scripts, which writes 400M prescriptions per annum, to negotiate deeper discounts, contract with more retailers, and buy direct from manufacturers, not only squeezing a little more profit from the tightly margined business, but avoiding cataclysimic conflicts of interest that may arise from links to drug companies. At 28 x, ESRX looks affordable: the firm grew its EPS 45% over the last 12 months and its top line by about 10% over the same time period. We’d be buyers on a breakout, no doubt.