The Five-Year Drought for Savient Pharmaceuticals Shares May Finally be Ending (SVNT)

Since 2008's implosion from the stock, the interest in Savient Pharmaceuticals Inc. (NASDAQ:SVNT) has been waning. There was a brief burst of bullishness in September of last year, which stirred the bullish pot a little. But, when SVNT started to fade in October of that year - just as quickly as it had perked up - what lingering hopes there were for the stock finally started to melt away. By the middle of this year, pretty much everyone had written Savient Pharmaceuticals off as a lost cause. Big mistake. Over the last few days, SVNT has almost wiggled its way buck into a bullish zone.

First things first. Savient Pharmaceuticals Inc. is, as the name implies, a biopharma developer. The company's claim to fame is KRYSTEXXA, which is a treatment for refractory chronic gout. Yes, there's a market for it. About 8 million people in the United States alone with gout, and the number grows about 4% per year. Globally, the gout market should drive $1.8 billion in annual sales by 2019. Though SVNT is only aiming for the United States and then European market (initially), that's a majority of the opportunity.

So what happened back in 2008 to torpedo a rising-star stock? The safety of KRYSTEXXA was called into question. Though it's not necessarily the end of a world for a drug to show safety issues, for Savient, the worries never really went away.... for investors, or regulars. That is, it never went away, perhaps until now.

While echoes of KRYTEXXA's risks are still ringing, there may be a (relative) light developing at the end of the tunnel. That's what the chart's saying anyway, which may be foretelling of good news in the near future. In fact, SVNT has almost become a buy because of its recent bullish clues.

The nearby daily chart says it all. In July SVNT shares made a higher low, and as of today the stock's above the 100-day moving average line (gray). That's a big deal. It tried to clear that line in June, and in early July, but the market held it back. The third effort this week, however, seems to be getting traction, largely fueled by support at the 20-day and 50-day moving average lines. It all says the tide has turned in favor of Savient Pharmaceuticals.

To be fair, there's still plenty of risk here, so don't jump in blindly. But, along with the chart's budding bullishness, the chatter and rhetoric surrounding the company is also perking up, and is mostly positive. It's not a long-term holding, but this all points to some very solid short-term bullishness as long as SVNT can log a close above the 100-day moving average line at $0.68 just once today or next week.

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