SC Shoppers Drug Market

SC may 2010 sc may 2010 2

Shoppers recently dropped quite dramatically as a result of the Government of the day outlawing a rather elaborate system of kick-backs from the generic drug manufacturers on the grounds that this would ultimately save money for the health care system as a whole. Not exactly sure how it all fits together but you can bet your last dollar that some compromise will soon be found. There is even a competitor (Alimentation Couche Tard) announcing that they are going to open more pharmacies. Anyway this looks overdone and the EW count would suggest that a reasonable upside is there. Different counts can be attached to the charts but all suggest that $44 is likely after the lower gap is filled and in the end $50 (the top of the triangle range or wave b) is a possibility.