Health and Healthcare

5 Small-Cap Biotech Stocks Trading Under $10 With Massive Upside Potential

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While most of Wall Street focuses on large-cap and mega-cap stocks, as they provide a degree of safety and liquidity, many investors are limited in the number of shares they can buy. Many of the biggest public companies, especially the technology giants, trade in the hundreds, all the way up to over $1,000 per share or more. At those steep prices, it is difficult to get any decent share count leverage.

Many investors, especially more aggressive traders, look at lower-priced stocks as a way to not only make some good money but to get a higher share count. That can really help the decision-making process, especially when you are on to a winner, as you can always sell half and keep half.

Each week we screen our 24/7 Wall St. research database looking for stocks rated Buy at major firms and priced under the $10 level. This week we found five new stocks that could provide investors with some solid upside potential.

With the number of new equity traders skyrocketing over the past year due to the Reddit/WallStreetBets and Robinhood popularity, locating good ideas to trade has become even more challenging. These five could all prove to be exciting additions for traders looking for solid alpha potential. While they are definitely better suited for aggressive investors, it is still important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.

Affimed

This German-based biotech has a solid pipeline and big-time upside potential. Affimed N.V. (NASDAQ: AFMD) is a clinical-stage biopharmaceutical company focused on discovering and developing cancer immunotherapies in the United States, Europe and Germany.

Its lead product candidate is AFM13, a natural killer cell (NK-cell) TandAb, which has completed Phase 2a clinical study of relapsed CD30-positive lymphoma and Phase 1b clinical study of anti-PD-1 antibody Keytruda (pembrolizumab) in patients with relapsed Hodgkin lymphoma.

The company also is developing AFM24, a tetravalent, bispecific epidermal growth factor receptor, and CD16A-binding innate cell engager for the treatment of advanced cancer patients; AFM26, an innate cell-engaging bispecific antibody targeting B cell maturation antigen for the treatment of multiple myeloma; and Trispecific antibodies for the treatment of multiple myeloma.

Credit Suisse has a giant $15 price target on the shares, while the consensus target is $12.85. The shares gapped up recently to near $8.


Chimerix

This is another biotech with outstanding potential and sizable upside. Chimerix Inc. (NASDAQ: CMRX) is a development-stage biopharmaceutical company focused on accelerating the advancement of various medicines that impact the lives of patients living with cancer and other serious diseases.

Its clinical-stage development programs include brincidofovir (BCV), an antiviral drug candidate in development as a medical countermeasure for smallpox; dociparstat sodium, which inhibits the activities of key proteins implicated in the resistance of acute myeloid leukemia blasts and leukemic stem cells to chemotherapy; and ONC201m a program for potentially treating tumors that harbor the H3 K27M mutation in recurrent diffuse midline glioma patients.

The company has license agreements with Biomedical Advanced Research and Development Authority for the development of BCV for use in the treatment of smallpox; Cantex Pharmaceuticals to develop and commercialize a glycosaminoglycan compound; and SymBio Pharmaceuticals to develop, manufacture and commercialize BCV for various human indications.

The strong $21 Wedbush price target compares with a $15 consensus target. The stock has traded back below $10 recently.

Epizyme

This biotech company has been rumored as a takeover candidate. Epizyme Inc. (NASDAQ: EPZM) is a commercial-stage biopharmaceutical company that discovers, develops and commercializes novel epigenetic medicines for patients with cancer and other diseases in the United States.

The company offers Tazemetostat for the treatment of metastatic or locally advanced epithelioid sarcoma for adults and pediatric patients. It also develops Tazemetostat in combination with rituximab in patients with follicular lymphoma; R-CHOP in front-line patients with high risk diffuse large B-cell lymphoma; and PARP inhibitor in patients with platinum-resistant solid tumors, such as small-cell lung cancer, triple-negative breast cancer and ovarian cancer.

In addition, it develops Tazemetostat in patients with castration-resistant prostate cancer; and adults and pediatrics with INI1-negative tumors. Further, the company develops pinometostat for the treatment of acute myeloid leukemia and acute lymphoblastic leukemia; PRMT5 inhibitor for patients with solid tumors; and PRMT1 inhibitor. Epizyme has collaboration agreements with Genentech, Glaxo Group, Roche Molecular Systems, Lymphoma Academic Research Organization and Eisai.

The Credit Suisse price target is $13, which is lower than the $18.89 consensus target. The shares were trading near the $8.70 level, and a solid move higher could break a long downtrend line.

Seelos Therapeutics

With two very strong clinical candidates, this is an outstanding idea for aggressive traders. Seelos Therapeutics Inc. (NASDAQ: SEEL) focuses on the development and commercialization of novel technologies and therapeutics for the treatment of central nervous system, respiratory and other disorders.

The company’s lead programs are SLS-002, an intranasal racemic ketamine for the treatment of acute suicidal ideation and behavior in patients with major depressive disorders; SLS-005, a protein stabilizer for the treatment of amyotrophic lateral sclerosis and Sanfilippo syndrome; and SLS-006, a partial dopamine agonist for the treatment of patients with Parkinson’s disease (PD).

Its preclinical programs include SLS-007, an anti-alpha-synuclein peptidic inhibitor to treat patients with PD; SLS-008, an orally available antagonist for chemoattractant receptor-homologous molecule for the treatment of chronic inflammation in asthma and pediatric orphan indications; SLS-004 for the treatment of PD; SLS-010, an oral histamine H3A receptor antagonist for narcolepsy and related disorders; and SLS-012, an injectable therapy for post-operative pain management.

B. Riley just started coverage and has a large $15 price target. The consensus target is down at $11.75. The shares have busted through the 50-day and 200-day moving averages and were just below $5 on Thursday.

Wave Life Sciences

One of the company’s recent studies had some disappointing results, giving traders a very solid entry point. Wave Life Sciences Ltd. (NASDAQ: WVE) a clinical-stage genetic medicine company that designs, optimizes and produces novel stereopure oligonucleotides through PRISM, a discovery and drug developing platform.

The company is primarily developing oligonucleotides target ribonucleic acid to reduce the expression of disease-promoting proteins or transform the production of dysfunctional mutant proteins into the production of functional proteins.

It develops WVE-120101 and WVE-120102, stereopure therapeutic candidates, which are in Phase 1b/2a clinical trials for the treatment of Huntington’s disease (HD); WVE-003, mutant huntingtin SNP3 program for the treatment of HD; WVE-004, C9orf72 program for the treatment of amyotrophic lateral sclerosis and frontotemporal dementia; WVE-N531, an Exon 53 program for the treatment of Duchenne muscular dystrophy; and ATXN3 program in SCA3.

Wave Life Sciences has collaboration agreements with Pfizer, Takeda Pharmaceutical, University of Oxford and University of Massachusetts.

Stifel has set a massive $17 price target, well above the $9.14 consensus. After the recent backup, the shares were trading just above $6.


These five super-aggressive biotech stocks are all rated Buy at well-known Wall Street firms. It should be noted that they are only suitable for very aggressive investors that have high-risk tolerance. While the prices are low, the risk could be very high if clinical trials are not met.

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