The biotech industry has been in the limelight since early 2020 because of its role in the fight against COVID-19. And while the industry is currently grappling with the supply constraints, it is expected to keep growing with continued innovations in treating critical diseases other than COVID-19 and continued increase in demand.
The global biotechnology market is expected to grow at a CAGR of 15.8% over the next seven years to hit $2.44 trillion by 2028.
SIGA Technologies, Inc. (SIGA) and BioDelivery Sciences International, Inc. (BDSI) have made significant progress on their pipeline products. We believe these stocks, which are currently trading at less than $10, have the potential to deliver robust returns in future.
SIGA Technologies, Inc. (SIGA)
Headquartered in New York, SIGA is a commercial-stage pharmaceutical company focused on the health security and infectious disease markets in the United States. Its lead product is TPOXX, which is an orally administered antiviral drug for the treatment of human smallpox disease caused by variola virus. SIGA is also developing post-exposure prophylaxis (PEP), liquid suspension pediatric formulation and ST-357.
SIGA entered a strategic partnership with Cipla Therapeutics, a division of Cipla USA Inc., and an affiliate of Cipla Limited, on March 23 to deliver sustained innovation and access to novel antibacterial drugs, particularly against biothreats. In January, the company announced that Public Health Agency of Canada (PHAC) had awarded a contract worth approximately $33 million to Pfizer, Inc.’s (PFE) Meridian Medical Technologies, Inc. for the purchase of SIGA’s TPOXX..
SIGA’s total revenues for the fourth, quarter ended December 31, 2020, was $37.80 million, which represents an 800% rise year-over-year. The company’s net income for the quarter was $20.10 million, versus a net loss of $4.50 million in the fourth quarter of 2019. Also, SIGA’s operating income came in at $26.80 million, compared to an operating loss of $3.40 million in the prior-year period. Moreover, its EPS was $0.26 compared to a loss per share of $0.06 in the fourth quarter of 2019.
A consensus EPS estimate of $0.76 for its fiscal year 2021, ending December 31, 2021, represents an improvement of 7.6% year-over-year. The consensus revenue estimate of $124.47 million for its fiscal year 2022 ending December 31, 2022 represents a 4.4% rise on a year-over-year basis.
The stock has gained 37.2% over the past year and closed yesterday’s trading session at $6.49.
It’s no surprise that SIGA has an overall A rating, which equates to Strong Buy in our POWR Ratings system. The POWR Ratings assesses stocks by 118 different factors, each with its own weighting.
The stock also has an A grade for Value and Quality, and a B grade for Growth. Click here to see the additional ratings for SIGA (Momentum, Stability and Sentiment).
SIGA is ranked #1 out of 481 stocks in the Biotech industry.
BioDelivery Sciences International, Inc. (BDSI)
BDSI is a specialty pharmaceutical company that develops and commercializes pharmaceutical products for chronic conditions, mainly in the areas of pain management and addiction. The company’s products utilize the BioErodible MucoAdhesive (BEMA) drug delivery technology, which is a small, erodible polymer film used for the application to the buccal mucosa, the lining inside the cheek.
In February, BDSI promoted Terry Coelho to the post of Executive Vice President and Chief Financial Officer of the company. BDSI also appointed Jeff Bailey as its permanent CEO on November 4, 2020. Furthermore, the company presented three scientific posters regarding BELBUCA at the 2021 North American Neuromodulation Society Meeting (NANS) that took place virtually from January 15–January 16.
For the fourth quarter ended December 31, 2020, BDSI’s total revenues increased 33.3% year-over-year to $42.17 million. The company’s income from operations were $12.46 million, which represents an improvement of 1931.8% year-over-year. Its non-GAAP net income also increased more than 114% year-over-year to $13.68 million. And its EPS were $0.10, compared to a loss per share of $0.01 in the fourth quarter of 2019.
A consensus EPS estimate of $0.07 for the next quarter ending June 30, 2021 represents an improvement of 600% year-over-year. It’s earnings surprise history looks impressive; the company beat the consensus EPS estimate in three of the trailing four quarters. The consensus revenue estimate of $42.98 million for the next quarter, ending June 30, 2021, represents a 17.5% rise on a year-over-year basis.
The stock has gained nearly 4% over the past year and closed yesterday’s trading session at $3.67.
BDSI’s POWR Ratings reflect this promising outlook. The stock has an overall B rating which equates to Buy in our POWR Ratings system.
The stock has an A grade for Quality, and a B grade for Value. In addition to the POWR Ratings grades we’ve just highlighted, one can see BDSI’s ratings for Growth, Momentum, Stability, and Sentiment here. BDSI is ranked #15 in the same industry.
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SIGA shares were unchanged in after-hours trading Tuesday. Year-to-date, SIGA has declined -10.32%, versus a 5.92% rise in the benchmark S&P 500 index during the same period.
About the Author: Sweta Vijayan
Sweta is an investment analyst and journalist with a special interest in finding market inefficiencies. She’s passionate about educating investors, so that they may find success in the stock market. More...
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