Biotech stocks are all the rage these days, largely because of the push for a coronavirus vaccine. However, there are plenty of biotech stocks worth your attention aside from the companies attempting to solve the coronavirus puzzle. Savvy investors will expand their scope to consider biotechs outside of those that have narrowed their focus on ending the pandemic.
However, there are hundreds of attractive biotech stocks to sort through, many of which are attempting to find cures or treatments for similar maladies. Let’s take a look at three of the more intriguing biotech stocks to help determine if they are worthy of consideration for your portfolio: Seattle Genetics, Cytokinetics and Fortress Biotech.
Seattle Genetics (SGEN)
Antibodies are the talk of the land as the coronavirus spreads throughout the United States. SGEN relies on antibody therapies to treat autoimmune diseases as well as cancer. The company’s Adcetris drug has been approved for use in the fight against Hodgkin lymphoma. SGEN’s Padcev drug is used to treat bladder cancer. The company’s breast cancer drug, Tukysa, is also poised to be a money-maker.
SGEN revenue is up more than 20% on a year-over-year basis. The analysts have set a high target of $246 for the stock with 12 recommending it as a buy, four advising investors to hold and only one advising investors sell. The POWR Ratings have SGEN ranked 22nd out of 336 Biotech stocks. Take a close look at the POWR Components and you will find there are no chinks in SGEN’s armor. The company has As across the board, making it a true POWR Ratings superstar.
Cardiovascular disease and cancer are the top causes of death. However, the silver lining to the threat of heart disease and the “Big C” is we can make money from their treatment and prevention. CYTK presents such an opportunity. This biopharmaceutical business is zeroed in on creating small molecule therapies to treat cancer, cardiovascular disease and ALS. At the moment, CYTK’s top drug candidate, tirasemtiv, has earned orphan drug designation along with fast-track status by the Food and Drug administration.
The POWR Ratings have CYTK ranked 59th out of more than 330 Biotech stocks. CYTK aces every single POWR Component but for its Buy & Hold Grade. The average analyst price target for the stock is in excess of $30, meaning there is nearly 45% upside potential. The high forecast for the stock is $35. All in all, five analysts recommend buying the stock while none recommend holding or selling.
The FDA is expediting the company’s top drug candidate, omecamtiv mecarbil. The aim of this treatment is to assist patients saddled with heart issues better handle reduced ejection fraction. This is an important step in the right direction for CYTK as more than 60 million people across the globe are impacted by heart failure. The number of people with heart problems will only continue to increase as the baby boomer age cohort moves through its golden years.
Fortress Biotech (FBIO)
Chances are you or someone in your family will be diagnosed with cancer or an inflammatory disease down the line. Biotech companies such as FBIO are hard at work developing pharmaceutical solutions for these maladies and bringing them to market. Once known as Coronado Biosciences, FBIO’s novel immunotherapy agents will undoubtedly be in demand for decades, if not centuries into the future.
It is particularly interesting to note the analysts’ average price target for FBIO is $8.50, meaning there is more than 160% upside. The low forecast for the stock is $6. The POWR Ratings have FBIO ranked in the top 20 of more than 330 stocks in the Biotech space. The stock has As in every POWR Rating component without exception.
Furthermore, FBIO has earnings per share growth of 16% on an annual basis. The company’s revenue was up nearly 40% last year. Though FBIO is not the biggest name in the biotech sector, its analyst price targets and solid POWR Ratings certainly warrant investor attention.
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SGEN shares . Year-to-date, SGEN has gained 31.66%, versus a -2.69% rise in the benchmark S&P 500 index during the same period.
About the Author: Patrick Ryan
Patrick Ryan has more than a dozen years of investing experience with a focus on information technology, consumer and entertainment sectors. In addition to working for StockNews, Patrick has also written for Wealth Authority and Fallon Wealth Management. More...
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