Biopharmaceutical Stocks Rally- Many Rayno Picks up 2%+
If the past four days was the long awaited biotechnology correction it was barely noticeable, a mere 3.7% high to low over the past week.Today the rally has resumed with major large cap holdings from funds and ETFs for example : ALXN, AMGN, BIIB, GILD, and PCYC. Regeneron (REGN) was a laggard down 1.1% and 4.5% over five days due to profit taking. Regeneron and partner Sanofi announced positive results from its Phase 2a asthma drug dupilimab.
Cubist (CBST $55.28) was a big winner yesterday and today is breaking out of a one year base near $50 with upgrades and news on a favorable patent ruling with Hospira.
Overall the Rayno Biopharmaceutical Portfolio is having a good day with several other stocks up 2% or more: ACHN, ALKS, ARRY, ASTX, and VPHM.
We have not made any biopharma portfolio changes other than recommending a little profit taking.This Week’s Barrons on p28 highlights the biotech fund (FBDIX) breakout and picking 3 well known stocks as buys: CLDX, GILD, and REGN. The 3 star Franklin Biodiscovery Fund (FBDIX) is up 30% YTD but trails the 5 Star Fidelity Biotechnology Fund (FBIOX) which outperforms over the longer term. You may notice that many life science funds and ETFs hold the same 10 winners.
There are several large funds focused on biotech and healthcare and many growth funds that need to be in life science growth stocks so the sector should hold if NASDAQ keeps on rallying and no bad news is forthcoming.
With “FEDheads” talking the cheap money every day it is hard to envision a major correction. Goldman Sachs came out with a bullish call today despite many major bank strategists already calling for a 2013 market under the current S&P value of 1672.