These Biotech Stocks Could Double Your Money, According To Analysts
The biotech industry has been in the limelight since the COVID-19 pandemic, with public and private sectors pouring in funds to bolster innovation and the development of relevant drugs.
Approximately 63% of public biotech firms reported revenue growth in 2021. Emerging biotech companies, which have annual revenue below $500 million, recorded a median 40% annual revenue growth rate, outpacing industry giants, which reported a lower 35% average annual revenue growth rate.
While the pandemic-related needs have since subsided, companies have been trying to maintain the momentum by focusing on developing cures for life-threatening severe illnesses. As the West grapples with an aging population and increasing lifestyle-related ailments, relatively small biotech firms with a promising product line are poised to achieve robust growth.
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Warren Buffett once said, "If you don’t find a way to make money while you sleep, you will work until you die." Here are three high-yield investments to add significant income to your portfolio.
Nkarta
Nkarta Inc. (NYSE:NKTX) is developing a cure for the chronic ailment lupus and has received clearance from the U.S. Food and Drug Administration (FDA) for its allogenic cell therapy candidate designed to treat lupus nephritis. Nkarta stock surged more than 68% over the past month.
The small-cap company has been working on the next steps after receiving investigational new drug clearance from the FDA last month. It's partnering with Lupus Therapeutics, a clinical research affiliate of Lupus Research Alliance, the largest nongovernmental lupus research center in the world.
Needham & Co. reiterated its Buy rating on Nkarta with a price target of $15, indicating a potential upside of over 550%. On the other hand, investment bank Raymond James upgraded its rating on Nkarta to Strong Buy with a price target of $13. This indicates a potential upside of over 463%.
While New York-based investment bank H.C. Wainwright & Co. lowered its price target on Nkarta, it still maintains a Buy rating. Wainwright's $10 price target indicates a potential upside of over 340% for Nkarta stock.
Repare Therapeutics
Shares of Repare Therapeutics Inc. (NASDAQ:RPTX) are up nearly 30% over the past five days, making it one of the best-performing penny stocks over the past week. The company focuses on clinical-stage precision oncology and has reported positive initial data from its phase 1 clinical trial, generating investor enthusiasm.
“We're excited by these first clinical proof-of-concept results and believe that they further validate the pipeline power of our SNIPRx discovery platform,” said Lloyd M. Segal, president and CEO of Repare Therapeutics. “[It] is an important step forward in Repare's mission to deliver next-generation precision oncology medicines to patients with genomically defined tumor alterations predicted by our platform to respond to our candidate drugs.”
Mark Lampert, who has a 10% equity stake in Repare Therapeutics, recently bought an additional 783,709 shares of Repare, as revealed from a Form 4 filing on Nov 6.
Investment bank Piper Sandler has an Outperform rating on Repare, with a price target of $25. This indicates a potential upside of nearly 500% from its current price. U.S.-based investment banking firm Stifel Financial Corp., which has over $430 billion in assets under management, also has a Buy rating on Repare, with a price target of $17, reflecting a potential upside of 300%.
Cara Therapeutics
Currently trading at just over $1, Cara Therapeutics Inc. (NASDAQ:CARA) is another promising biotech penny stock that is expected to break out soon. U.S.-based multinational financial services firm and investment bank Piper Sandler has a Buy rating on the stock, with a price target of $7. This reflects a potential upside of over 430%.
The company, which specializes in commercial-stage products for pruritus patients, reported a breakthrough after its patented IV injection syringe was approved by Japan's Ministry of Health in September. Cara Therapeutics received a milestone payment of $1.5 million following the approval.
"We are pleased that our first-in-class therapy KORSUVA injection will be available to hemodialysis patients in Japan who are suffering from pruritus," Cara Therapeutics President and CEO Christopher Posner. "As we work toward establishing Cara Therapeutics as the leader in the treatment of chronic pruritus, we will continue to collaborate with our partners to address the significant unmet need for an effective anti-pruritic treatment for chronic kidney disease patients undergoing hemodialysis worldwide."
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