For Immediate Release
Chicago, IL –April 1, 2019 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: ANI Pharmaceuticals, Inc. ANIP, Kamada Ltd. KMDA, Genomic Health, Inc. GHDX and NewLink Genetics Corp. NLNK.
Here are highlights from Friday’s Analyst Blog:
4 Small Biotechs Likely to Witness More Upside in 2019
The biotech space is off to a good start in 2019. The biotech industry, comprising mainly small and mid-cap companies, has outperformed the broader Medical sector, whereas the large cap pharmaceuticals industry, comprising some of the largest drugmakers of the world, has lagged the sector so far in 2019.
The Zacks Biomedical and Genetics industry has increased 9.6% so far in 2019 compared with the broader Zacks Medical sector’s rise of 7.5%.
With increasing risk of recession in the United States amid tariff wars with several global trade partners, the biotech sector is expected to do well. Investors park their money in recession-proof industries like drug/biotech and consumer goods to avoid the risk of a downfall.
We note that the majority of the companies in the biotech sector have no marketed products, which results in operating losses. With no earnings and sales, growth of these companies is primarily driven by progress in their pipeline candidates in clinical stage. Several positive study data readouts and progress of candidates to advanced stage have pulled the sector higher in 2019 so far. Moreover, a rise in merger & acquisition (M&A) activity this year has fueled speculations of smaller companies being potential acquisition targets These speculations have boosted the stock price of these smaller players. The biggest deal of the year was Bristol-Myers’ acquisition offer of $74 billion to buy Celgene. Several other large-cap pharma as well as bigger biotech companies are entering collaboration deals with smaller ones to boost their pipeline.
The larger companies in the biotech sector, which hold the majority of the industry’s market capitalization, have a strong portfolio of drugs, commercial as well as a solid pipeline of innovative candidates. These big biotechs have a strong balance sheet and a steady stream of revenues. Among the bigwigs, Celgene, Vertex, Biogen and Amgen beat earnings estimates in the last quarter of 2018.
With rising M&A activity and risk of recession, the biotech sector is poised to pick up and adding stocks from this sector will likely boost portfolio returns.
Importantly, the Zacks Biomedical and Genetics industry features among the top 32% of the 256 Zacks-ranked industries.
Stocks to Buy
Here we have zeroed in on four companies from the biotech/drug sector which have performed well so far in 2019 and still hold upside. All these stocks have seen their share price and earnings estimates rise this year.
These stocks carry a Zacks Rank #1 (Strong Buy) or 2 (Buy) and have a VGM Score of A or B. You can see the complete list of today’s Zacks #1 Rank stocks here.
Our research shows that stocks with a VGM Score of A or B when combined with a Zacks Rank #1 or 2 offer the best upside potential.
ANI Pharmaceuticals, Inc.
ANI Pharmaceuticals sports a Zacks Rank #1. The company has a VGM Score of A. The Zacks Consensus Estimate for earnings has moved 1.2% and 0.6% north for 2019 and 2020, respectively, in the past 60 days. Shares of the company have rallied 50.5% so far this year.
Kamada sports a Zacks Rank #1. The company has a VGM Score of A. The Zacks Consensus Estimate for earnings has moved up 34.3% and 5% for 2019 and 2020, respectively, in the past 60 days. Shares of the company have rallied 15.8% year to date.
Genomic Health, Inc.
Genomic Health carries a Zacks Rank #2. The company has a VGM Score of B. The Zacks Consensus Estimate for earnings has moved up 21.1% and 6.4% for 2019 and 2020, respectively, in the past 60 days. Shares of the company have risen 7.3% so far in 2019.
NewLink Genetics Corp.
NewLink Genetics carries a Zacks Rank #2. The company has a VGM Score of B. The Zacks Consensus Estimate for loss has narrowed 10.9% and 19.2% for 2019 and 2020, respectively, in the past 60 days. Shares of the company have rallied 25.7% in 2019.
However, a few companies faced developmental or regulatory setbacks. These setbacks wiped out majority of the valuation of smaller companies dependent on a single candidate, .
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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Kamada Ltd. (KMDA) : Free Stock Analysis Report
ANI Pharmaceuticals, Inc. (ANIP) : Free Stock Analysis Report
Genomic Health, Inc. (GHDX) : Free Stock Analysis Report
NewLink Genetics Corporation (NLNK) : Free Stock Analysis Report
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