Health and Healthcare

New Analyst Biotech Stocks to Buy With Gigantic Implied Upside

After being absolutely rocked back in the spring, the biotech sector has bounced back smartly. Even a bubble comment from the head of the Federal Reserve Janet Yellen didn’t stop the return of the biotechnology investors. The bottom line going forward is that the large-cap leaders trade at forward earnings multiples as low as those of low-growth pharmaceutical companies, and smaller biotechs with upcoming catalysts may provide risk tolerant investors big gains.

New research reports from JPMorgan and Deutsche Bank have yielded four new top companies to buy that 24/7 Wall St. readers with a high risk tolerance profile may find very interesting. While not for the timid, these four new analysts stocks to buy could ultimately become big winners.

Alnylam Pharmaceuticals Inc. (NASDAQ: ALNY) engages in discovering, developing, and commercializing novel therapeutics based on RNA interference (RNAi). The analysts at Deutsche Bank think that the fourth quarter could be a catalyst bonanza time for the company. With multiple data presentations expected, and an intellectual property catalog of 125 patents, there are multiple avenues for success. The company said at its recent earnings presentation it expects R&D will increase slightly in the last half of the year as programs that are in late stage development are completed. With $956 million of cash on hand, the company is in good shape. The Deutsche bank price target for the stock is a massive $108. The Thomson/First Call consensus target is $94.67. Shares closed Friday at $58.15. A move to the Deutsche Bank target would be a huge 86% gain.

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Amicus Therapeutics Inc. (NASDAQ: FOLD) has been on fire and has recently seen some very large insider buying. Wall Street analysts at JPMorgan and other firms that we cover are very positive on the outcome of the Phase 3 Study 012 data for Amigal. Many are assigning 75% and 50% probabilities of approval success in the EU and the U.S., up from 20% earlier this year. The JPMorgan analysts continue to believe Study 012 has a high probability of success and they are forecasting peak worldwide sales of around $200 million for the migalastat monotherapy treatment for Fabry disease. Their price target for the stock is $7, and the consensus price target for the stock is $6. Amicus closed Friday at $4.14. Trading to the JPMorgan target would be almost a 70% gain.

BioCryst Pharmaceuticals Inc. (NASDAQ: BCRX) designs, optimizes and develops small molecule pharmaceuticals that block key enzymes involved in the pathogenesis of diseases. The company currently has a polymerase inhibitor in preclinical evaluations that may be instrumental in a new treatment. While far away from anything final, the company also has multiple pipeline products that could prove interesting to major pharmaceuticals. JPMorgan recently initiated coverage based on both the near-term and long-term potential of the company’s unique, orally administered drug candidates for the prophylactic treatment of hereditary angioedema (HAE), a severely debilitating and potentially lethal orphan genetic disease. JPMorgan analysts rate the stock at Overweight with a strong $20 target. The consensus is at $17.45. Shares closed Friday at $13.96, up over 8%. Trading to the target price would be a 43% gain for investors.

Neurocrine Biosciences Inc. (NASDAQ: NBIX) continues to report success partnering with AbbVie on the Elagolix trials, which are now in Phase 3. The company has reported that the data from the trials was clinically and statistically meaningful. The Deutsche bank team points out in their note that final data is expected late this year or in early 2015, and ultimately the stock has a $4 to $5 immediate upside or downside, depending on the outcome. The analysts also said efficacy looks very solid. The Deutsche Bank price target for the stock, which is rated at a Buy is $25. The consensus target is posted lower at $21.14. The stock closed Friday at $13.67. Trading up the Deutsche Bank level would be a massive 83% gain.

As we point out regularly, these stocks are very volatile and failure in their large studies could prove disastrous for the share price. With that in mind, aggressive accounts may want to dedicate some of their trading capital to one of these top stocks.

 

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