|Bid||81.55 x 800|
|Ask||81.78 x 1000|
|Day's Range||81.58 - 83.42|
|52 Week Range||64.38 - 101.55|
|PE Ratio (TTM)||N/A|
|Beta (3Y Monthly)||2.04|
|Expense Ratio (net)||0.35%|
A biotech breakout. The Apple effect. And do ETFs really cause volatility? With CNBC's Bob Pisani, Dave Nadig, ETF.com and Doug Yones, New York Stock Exchange.
Biotech ETFs are soaring today as deal talk in the space heats up. The XBI is up 5 percent and the IBB is up 3 percent. We look under the hood of these two big biotech ETFs and discuss the differences.
So far, 2019 is starting off with a bang in the pharmaceutical industry. Last week, we learned that Bristol-Myers Squibb (NYSE:BMY) is buying out beleaguered Celgene (NASDAQ:CELG) in a behemoth $74 billion takeover. Eli Lilly (NYSE:LLY) followed that up with a large deal of its own, announcing an $8 billion offer for Loxo Oncology (NASDAQ:LOXO). Whether the purchase helps Eli Lilly stock in the long term is another question altogether. While it may seem small compared to the blockbuster Celgene deal, $8 billion is still a major announcement. Don't forget Gilead Science's (NASDAQ:GILD) deal to buy the revolutionary Hep-C cure company Pharmasset for $11 billion in 2011. Within a couple years, GILD stock quintupled as the Pharmasset drugs lifted Gilead's profitability to the stratosphere. Needless to say, Loxo, if it delivers in similar fashion, could fundamentally reshape Eli Lilly's future for many years to come. That's especially as Eli Lilly has some patent expirations of its own to consider and really could use a big new product launch or two. InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 7 Stocks at Risk of the Global Smartphone Slowdown ### Loxo: A Steep Price Could Hamper Eli Lilly Stock It's no secret that biotech stocks got crushed in the 2018 correction. The SPDR Biotech ETF (NYSEARCA:XBI) dropped as much as 35% within three months. That meant that companies with strong balance sheets had the ability to go discount shopping. Bristol-Myers was first to take a big swing with the Celgene deal. However, Eli Lilly's move will also be a game-changer. Not only did Eli Lilly pay $8 billion for Loxo, they also paid a huge premium. LOXO stock previously traded as high as $188/share. Due to the biotech correction it was trading around $140 prior to Eli Lilly's offer. As such, you'd think something like $200/share (above Loxo's all-time high) would be enough to close the deal. Instead, Eli Lilly offered a whopping $235/share. Now, to be fair to Eli Lilly, Loxo did enjoy a positive development in that interim period; they managed to get FDA approval for their leading pipeline drug candidate. Though, that approval was widely expected. Regardless, Eli Lilly is paying heavily for a company that is just at the beginning of the commercialization process for their drug candidates. ### Loxo and Eli Lilly Stock Loxo has taken a different path from most companies in oncology. Instead of targeting its drugs for specific types of cancer, such as lung or prostate, Loxo targets genetic mutations. These genetic mutations appear to lead to cancers across a variety of different body parts. Loxo's first approved drug targets NTRK gene fusions. This is a rare condition which occurs in roughly 0.2% of the population. Loxo estimates that there are a few thousand eligible patients with NTRK fusions in the U.S. at this time. Thus, with a nearly $400,000/year price tag for the drug, it may take longer than expected for Loxo's product to become a huge commercial seller. The Chief Business Officer for Loxo, Jake Naarden, stated last year that: "We expect the initial launch to be challenging, though we remain optimistic about the longer-term trajectory. One of the truisms you often hear about new drug launches is that the first few quarters determine the commercial fate of the drug. Given the penetration of tumor genomic testing today, we do not believe that the first few quarters of this launch will inform very much." He makes an important point. Most oncology patients are not prescribed genomic testing today. Additionally, some genomic tests do not include the NTRK fusion. As a result, many potentially eligible patients may not know that Loxo has a beneficial therapy for their condition. This, however, highlights one big advantage to the Eli Lilly purchase. Eli Lilly has far more connections and influence within the medical community. It has the budget and reach to ensure that more cancer patients test their genomes and are aware of potential novel solutions. It's likely that Eli Lilly's purchase will bring Loxo's first drug far more attention and quicker clinical uptake. Loxo also brings its promising Loxo-292 therapy which is still in clinical trails. ### Eli Lilly Stock Takeaway One point in favor of the deal is that Eli Lilly has a strong balance sheet and can pay for Loxo with cash. Heading into the deal, Eli Lilly had $9 billion in cash against $13 billion in total debt. The Loxo purchase will consume almost all of the company's existing cash reserves, but still leave it in a reasonably sound fiscal position. After adjusting for one-time expenses, Eli Lilly will earn in the ballpark of $4.5 billion dollars for 2018. That means that it's net debt load is not especially problematic. On a debt/EBITDA basis, it comes in around 1.5x, which is quite conservative. From an earnings basis, the Loxo deal will consume just under two full years of Eli Lilly's ongoing net income. Given the limited size of Loxo's market, at least at first, Eli Lilly won't earn back its $8 billion purchase price in the near-term. But the potential is still great. Eli Lilly is buying a drug platform with a rather novel approach to treating cancer. If the company is able to commercialize other Loxo drugs that are earlier along in clinical trials, the deal could end up being a big win for Eli Lilly stock. At this point, Eli Lilly stock may be a bit overvalued. It's still trading at 20x forward earnings. That's quite aggressive for a pharma company, as patent expirations tend to keep PE ratios rather low. And Eli Lilly stock is up 35% over the past year which is a stark contrast to struggles elsewhere in the health care space. As for the Loxo deal in particular, it could pay off big, but for now, a wait and see approach seems most prudent. At the time of this writing, Ian Bezek owned GILD stock. You can reach him on Twitter at @irbezek. ### More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Stocks You Can Set and Forget (Even In This Market) * 10 Virtual Assistants for the Future of Smart Homes * 7 5G Stocks to Buy as the Race for Spectrum Tightens Compare Brokers The post The Loxo Oncology Purchase Eventually Could Help Eli Lilly Stock appeared first on InvestorPlace.
TORONTO, ON / ACCESSWIRE / January 10, 2019 / The Wealthy Biotech Trader (or ''WBT''), an investment newsletter focused on showing everyday investors new opportunities in rapidly growing, little-known biotech, pharma, medical device stocks making news and subsequent market moves, would like to update investors on several breakthroughs in cancer therapies hitting the market. Stock investors have soured on biotech companies over the past several months, as demonstrated by the SPDR S&P Biotech ETF (XBI), off 30% since June, and the NYSE Biotechnology Index (NYSE:NBI), which has dropped from 3500 in mid-2018 to just under 3000 at year-end, and a host of their component companies and others in addition. One of those is Propanc Biopharma, Inc. (OTCQB:PPCB), an Australian biotech company with strong management and technology that has the potential to help millions of cancer patients worldwide.
Biotechnology stocks and sector-related ETFs were among the best performers Monday after Eli Lilly (NYSE: LLY) said it will acquire Loxo Oncology Inc. (NasdaqGS: LOXO) for $8 billion. Among the best performers ...
Why Portola Pharmaceuticals Rose 8.09% on January 4 ## Stock performance On January 4, Portola Pharmaceuticals stock closed at $19.38, an 8.09% increase from its prior close of $17.93 on January 3. On December 31, 2018, Portola Pharmaceuticals stock price grew ~14.22% to reach $19.52 from its prior close of $17.09 on December 28. The stock price on January 4 was ~65% below its 52-week high of $55.48 on January 29, 2018. The company hit its 52-week low of $14.81 on December 24, 2018. ## Recent developments On December 2018, the US FDA (Food and Drug Administration) approved Portola Pharmaceuticals’ PAS (prior approval supplement) for large-scale, second-generation Andexxa. The approval enables a wide commercial launch of Andexxa in the US market. In May 2018, the FDA approved Andexxa under the accelerated approval pathway. The FDA also granted Andexxa an orphan drug designation and a breakthrough therapy designation. The approval is expected to boost the commercial launch of Andexxa in the US market, which in turn could significantly boost the revenue growth of Portola in 2019. ## Financials in a nutshell In the first nine months of 2018, Portola Pharmaceuticals’ net revenues grew ~95% YoY to reach $24.8 million from $12.7 million. Wall Street analysts estimate that Portola Pharmaceuticals will generate net revenues of $35.70 million, which represents ~58.35% YoY growth. The revenue growth of Portola Pharmaceuticals (PTLA) could boost the SPDR S&P Biotech ETF (XBI). The company makes up about ~1.31% of XBI’s total portfolio holdings. In the first nine months of 2018, Portola reported net income and EPS of -$261.7 million and -$3.97, respectively, compared to -$194.3 million and -$3.38 in the same period the prior year. Wall Street analysts estimate that Portola Pharmaceuticals will report net income and EPS of -$333.57 million and -$5.03, respectively, in fiscal 2018. ## Analysts’ recommendations Of the seven analysts tracking Portola Pharmaceuticals in January 2019, three of them recommended a “strong buy,” two analysts recommended a “buy” rating, and two analysts recommended a “hold” rating. On January 7, 2019, the company had a consensus 12-month target price of $35.83, which represents a ~84.88% return on investment over the next 12 months.
After a strong 2017, biotech stocks are on track to end the year in the red despite a record 59 new molecular entity approvals , some noteworthy M&A deals and several breakthrough developments in drug ...
After extended weakness, biotech stocks turned a corner along with the broader markets to close out the week. With just a session left, it looks less likely the sector ends in the black for the year. The ...
Heading into December, biotech stocks held up fairly well in 2018. Evaluate Pharma , a firm specializing in data-driven news and analysis in biotech, compiled a list of blockbuster drugs in the works with ...
Shares of Intra-Cellular Therapies Inc. plummeted 22% in pre-market trade Tuesday after the company announced it would discontinue its Phase 3 clinical trial of lumateperone for the treatment of agitation in patients with Alzheimer's disease. An interim analysis of the the trial concluded it would likely not meet its primary endpoint. "Effective clinical study design is a challenge, especially for a therapeutic indication for which there are no approved treatments," said Dr. Sharon Mates, the company's chairman and CEO, in a statement. Shares of Intra-Cellular Therapies have fallen 11.1% in the year to date, while the SPDR S&P Biotech ETF , which includes smaller biotech companies, has fallen 11.6%. The S&P 500 has fallen 4.8%.
One trigger was the arrest in Canada for extradition to the United States of the well-connected CFO of China telecom champion Huawei Technologies Co. because of that company's alleged evasion of U.S. sanctions on Iran. Contributing mightily to the recent volatility in the stock market is the rise of algorithmic trading -- basically, computer programs that trade instantly on the latest headlines. A respected fund manager on CNBC the other day stated that 80% of the trading volume in any given day is driven by these automated trading engines.
Shares of Revance Therapeutics Inc. were up 1.9% in premarket trade Tuesday after the company announced it had entered an agreement with Shanghai Fosun Pharmaceutical Industrial Development Co. to give Fosun exclusive rights to develop and commercialize Revance's botulinum toxin formulation RT002 in mainland China, Hong Kong and Macau. Under the licensing agreement, Revance will receive an upfront payment of $30 million and is eligible to receive up to an additional $230.5 million in future development and sales milestone payments, as well as royalties on future net sales. Shares of Revance have fallen 42% in the year to date, while the iShares Nasdaq Biotechnology exchange traded fund has gained 3.3%. The SPDR S&P Biotech ETF, which includes smaller biotech companies, has fallen 0.3%, and the S&P 500 has advanced 4.4%.
On December 3, Clovis Oncology stock closed at $19.08, which represents ~10.87% growth from its close of $17.21 on November 30. Clovis Oncology’s stock price grew from $11.63 at the close of business on October 31 to $17.21 at the close of the market on November 30, which reflects ~48% growth in November.
The decline in biotech stocks is more about investors fleeing a high-beta group in a risk-off environment.
On November 28, Acadia Pharmaceuticals (ACAD) stock closed at $20.53, which represents a ~20.76% rise from its close of $17.00 on November 27. On November 27, Acadia Pharmaceuticals announced a price of $17.00 per share for an underwritten public offering of 16,176,471 shares of its common stock. Acadia Pharmaceuticals’ net revenue in the first nine months of the year amounted to $164.2 million compared to $81.3 million in the same period last year.
Investor sentiment has now fallen prey to the stock-market equivalent of cardiac arrest. Sentiment is now so dead that it suggests the next leg of the stock market is up, in the contrarian sense. This ratio has spiked to levels frequently followed by rallies, says Doug Ramsey, chief investment officer of The Leuthold Group.
The problem today is that the market negative has been consistently negative for a while and even when there is a relief bounce, like we had on Wednesday, the strength is being used as an opportunity for reduction of long positions rather than a sign that a bottom may be forming. Overall breadth is running negative, with around 3200 gainers to 3600 decliners, and there are over 250 names hitting new 12-month lows. -- are still under pressure and the DJIA is at a recent closing lows.