More than an "Ebola Stock" - This Medical Leader Is a Long-Term Profit Machine

Some investors continue to chase one "Ebola stock" after another, hoping to profit from the company that successfully finds a cure for the disease.

But these investors are doing it wrong. Instead of finding sound investments, they're just chasing headlines.ebola stock

Here are a few examples:

On Oct. 8, shares of "Ebola stock" Chimerix Inc. (Nasdaq: CMRX) tanked 22.2% in less than an hour following news that the first U.S. Ebola patient passed away in Dallas. The company's experimental drug was being used to treat the patient.

Tekmira Pharmaceuticals Corp. (Nasdaq: TKMR) is also conducting Ebola research. Its stock climbed to nearly $30 on Oct. 3. Just four trading sessions later, the stock was down to $20.75. That's a loss of 30.6% in less than a week.

This is a trend that Money Morning's Chief Investment Strategist Keith Fitz-Gerald has watched for months.

"The market is driving up Ebola vaccine stocks on nothing more than media hype - and then dropping them back down" Fitz-Gerald said. "Many of the experimental drug companies that might be working on an Ebola cure are being knocked around Wall Street like so many Ping-Pong balls."

That's why Fitz-Gerald recommended a different type of medical tech stock.

It's a company that's a good investment regardless of the outbreak. The Ebola crisis has simply acted as a catalyst for the share price.

"Even without an outbreak, this is a good, solid strategic medical play that will benefit from such long-term trends as the increasing sophistication of healthcare therapies, global growth, and the modernization of medical sectors in markets throughout the world," Fitz-Gerald said.

Take a look ...

The Best Medical Stock to Buy Now

Fitz-Gerald profiled Becton, Dickinson and Co. (NYSE: BDX) for his Money Map Report subscribers Aug. 20. The stock has climbed 6% since.

BDX is a medical device company that specializes in single-use diagnosis, treatment, and instrument systems.

The company's medical division supplies needles, syringes, catheters, and other products to hospitals and clinics. Its diagnostics business develops products for the safe collection and transport of diagnostics specimens. Finally, its bioscience division produces research tools for labs, biotech companies, and government institutions.

And because most of the company's products are single-use, customers are required to reorder products on a regular basis.

Right now, the Ebola outbreak is a catalyst for BDX shares. The stock has gained 11% in the last six months.

"I think our country's health officials - if not terrified - are certainly much more fearful than they're letting on," Fitz-Gerald said. "If they were as confident as they claim, the U.S. Food and Drug Administration (FDA) wouldn't have given emergency approval for the use of a late-stage - unproven - drug candidate, as it did last week. That underscores the very real danger this threat poses, and it also illustrates the constantly shifting picture, or landscape, which is why investors looking here need to be so very careful."

And the fact that BDX's recent gains haven't been predicated on experimental drugs is huge. Drug stocks post huge losses when treatments fail. BDX's products will remain vital.

But the best thing about BDX is that it offers long-term profit opportunities. It's still a great stock long after Ebola is neutralized...

BDX Stock's Long-Term Potential

"One of the key reasons I continue to recommend BDX stock is that this isn't just an Ebola-threat company: It's a company whose products will play a crucial role against any medical threat there is," Fitz-Gerald said.

This is far from the first outbreak we've seen and it definitely won't be the last. The outbreaks of the avian flu and SARS (severe acute respiratory syndrome) within the last 12 years are a testament to that.

"That's one 'given' in an outbreak of almost any type," he continued. "Once doctors have identified a threat and understand what that threat is, they immediately switch to disposable devices and supplies. Everything becomes expendable. Sure, you can disinfect or sterilize devices - using an autoclave, for instance. But why risk it. If there are disposable alternatives, [the medical teams] use them."

That's what is so great about BDX's products. They can be used by the entire medical industry. We're not talking about a specialized company that only fights one disease.

"Every medical study I've ever seen talks about the size of the medical industry, talks about the dollar value of the industry, talks about the global footprint of the industry and talks about the growth the industry is expected to see - all of this and more over the past 10 years - and has never failed to understate what ends up really playing out... by a factor of five."

More from Keith Fitz-Gerald: Despite what most politicians and central bankers think, we are not staring at a series of independent bubbles. Instead, we have one single, massive, $1.5 quadrillion derivatives bubble that surrounds us all. We can get through and take our profits at the appropriate time, though - all it takes is a little moxie and a steady game plan...