Health and Healthcare
4 Biotech Catalyst Stocks to Buy With 60% to 100% Upside Potential
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In the world of biotech investing, there are some sure-fire ways for stocks to move. Pipeline announcements, clinical data and regulatory approval all can move the needle as catalysts for stocks in the industry. A new report from the biotech team at Stifel has a self-described plethora of catalysts from companies that are presenting at the firm’s annual health care conference.
We screened the stocks in the Stifel report for those that were rated Buy at the firm and had the biggest upside to the analysts’ price objectives.
Array BioPharma Inc. (NASDAQ: ARRY) is a top small cap to buy at Stifel. The company focuses on the discovery, development and commercialization of small molecule drugs to treat patients with cancer and inflammatory diseases, primarily in North America, Europe and the Asia-Pacific. The company’s MEK inhibitors, binimetinib and selumetinib, are currently advancing in six Phase 3 trials, and Array’s partners expect the firm’s first regulatory filing next year with top line results from the other trials available in 2016. In addition, it continues to collect data on the wholly owned filanesib program in two Phase 2 multiple myeloma trials, including a randomized combination trial with Kyprolis. With the progress, the company expects potential commercial revenues within the next two years.
The Stifel price target is $6. The Thomson/First Call consensus is higher at $7. Shares closed Wednesday at $3.53. Hitting the Stifel target would be a monster 65% gain.
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Cempra Inc. (NASDAQ: CEMP) is a clinical-stage pharmaceutical company focused on developing antibiotics to meet critical medical needs in the treatment of bacterial infectious diseases. It announced this week that it has received authorization under its existing contract for the next phase of its contract with the Biomedical Advanced Research and Development Authority (BARDA) that will provide funding of $16.0 million for two clinical studies of solithromycin. The Stifel team views the initial read on the Solitaire-Oral study as indicating there may be label expansion possibilities for solithromycin.
The Stifel price target is $22, and the consensus target is $19.50. The stock closed Wednesday at $13.22. Trading to the Stifel target would be a 63% gain.
GlycoMimetics Inc. (NASDAQ: GLYC) announced Monday that healthy volunteers in a Phase 1 clinical study of GMI-1271 tolerated the drug candidate well, and that the pharmacokinetics for the drug candidate were as predicted based on preclinical data. The findings represent positive top-line results from a Phase 1 trial designed to evaluate the safety, tolerability and pharmacokinetics of GMI-1271, the GlycoMimetics-discovered novel and proprietary E-selectin antagonist. Based on the data, GlycoMimetics is planning a Phase 1/2 trial of GMI-1271 as an adjunct to standard chemotherapy in patients with acute myeloid leukemia. The Stifel team thinks the drug and clinical work will be very visible at the American Society of Hematology (ASH) conference to be held next month.
The Stifel price target is $13, and the consensus is higher at $14.67. The shares closed Wednesday at $7.78. Trading to the Stifel target would be a 72% gain.
MacroGenics Inc. (NASDAQ: MGNX) is a clinical-stage biopharmaceutical company focused on discovering and developing innovative monoclonal antibody-based therapeutics for the treatment of cancer, as well as autoimmune disorders and infectious diseases. The company generates its pipeline of product candidates from its proprietary suite of next-generation antibody-based technology platforms. It announced this week that pre-clinical data on MGD011, a humanized CD19 x CD3 dual-affinity re-targeting (DART) protein, will be highlighted in a poster presentation at the ASH.
The Stifel team feels that the company has best-in-class assets in a very relevant treatment area. The firm puts a $51 price target on the stock, and the consensus target is $45.83. Shares closed at $23.69. Hitting the Stifel target would be over a 100% gain for shareholders.
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These are extremely aggressive and potentially volatile stocks and trades. They are only suitable for speculative accounts with a very high risk tolerance. With that caveat in mind, some big gains could be there for biotech traders.
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