Grifols SA (BME: GRF) is a major Spanish pharmaceutical and chemical manufacturer, with headquarters in Barcelona. Founded in 1940, the company continues to prosper today with its research in blood plasma-based products. The Spanish pharma giant is a world leader in that field and it has no interest of losing that status. This might be one of the reasons why Grifols SA recently acquired a private company from San Carlos, California, Alkahest Inc. Alkahest is developing therapies derived from blood to treat neurological diseases, with an emphasis on age-related cognitive decline. Grifols splashed out $146 mln on Alkahest for its 100% ownership. It seems that this way, the Barcelona-based pharmaceutical company is trying to capture a bigger market share of the field where it operates. But it still is a quite competitive area with other big players such as CSL, Roche, Sanofi, Bayer and others. But with a current Beta of 0.21, GRF could be a stock for a long-term holder, as it can be less volatile than the general market.
Looking at the technical picture of GRF, after breaking a medium-term tentative downside resistance line drawn from the high of April 22nd, the stock started sliding again, but remains above that line. This gives hope for new potential investors that the share price still has a good chance of drifting higher. That said, more buyers might join in if GRF rises above the current highest point of September, at 24.71. Until then, we will remain cautiously bullish.
A strong push above the 24.71 barrier would confirm a forthcoming higher high, possibly interesting a few more buyers, who could help lift the price to the 26.05 hurdle, marked by the low of July 14th and the high of July 28th. That’s where the stock may initially stall for a bit, however if the buying interest is still strong, that might give GRF another boost. It could then drift to the high of July 20th, at 27.90.
Both the RSI and the MACD are currently on the flat side, with no clear indication of the short-term direction. The RSI is oscillating around 50 and the MACD is stuck near zero. This may support the idea to stand pat for now.
On the downside, a drop below the low of last week, at 23.13, would also place the price back below the aforementioned downside line. Such a move might spook new buyers from entering for a while and could increase the stock’s chances of moving further south. GRF may then slide to the 22.67 obstacle, a break of which might open the way to the 21.40 level, marked by the current lowest point of September, at 21.40.
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