Update-12/17. Amarin (AMRN)- A Sell on the News?
AMRN stock tanked another 6.7% today on last weekend’s news of the FDA approval of VASCEPA. This is what happens with momentum stocks with a well know story.The stock moved from the $25 level at Friday’s close to $21.34 today on ridiculous volume of over 25 M shares, We sold some of our position recently but still hold the stock bought over time in the teens. A well disseminated Stifel downgrade from buy to hold helped create the selloff.
In another update Teledoc (TDOC) was up 1.42% to $79.27 with some bullish comments on Seeking Alpha.
The XBI was flat today at $96.49 and biotech stocks overall were choppy but ASND BLUE, CLLS, IMMU and MRTX made strong moves up.Large caps were mixed with ALXN and BIIB weak. JNJ was up 1.25% on an upgrade from Morgan Stanley.
PacBio (PACB) was down 8% after hours on news that US Regulators will block the $1.25B merger with Illumina (ILMN).
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Life Science Portfolio Updates-Core Positions
Here is a brief update on three stocks we have covered since the 2019 JP Morgan Healthcare Conference with the biotech rally beginning in early October. The equal weighted XBI is up 13.71 % over 3 months and about 20 points since 10/1 to $95.36. The XBI is up 30.88% YTD compared to the IBB up 23.72% YTD.We recommended XBI for traders and investors who want to maintain a bullish position in biotech. Many small cap biotech stocks are included in the Russell 2000 (IWM) which is lagging many indices up only 21.3% YTD.
Here is a quick look at three picks from the 2019 JP Morgan Healthcare Conference:
Amarin Corportion plc (AMRN). Amarin stock was up 4.92% to $24.12 on Friday before it was put on hold pending FDA news on its VASCEPA approval to reduce cardiovascular disease risk.Based on this new indication and label extension the VASCEPA revenue guidance for 2020 was increased to a projected range of $650M- $700M from $400M -$425M. The label met most expectations but added a risk factor for diabetes. There were FDA concerns about overuse but overall there is physician discretion.Our initial buy price from JPMorgan was $14.75.We’ll see how the stock trades Monday but it should be up although fewer analysts are still bullish with an overall 2.2 buy rating with 3 being a neutral.
GenMark (GNMK) was a good trade from JP Morgan at $6.22 rising to $8 but subsequently declined on Q3 earnings and is now at the $5.35 level and a JPM downgrade. Revenue growth was 32% and the loss of (.20) per share was the same as last year. Analysts are neutral on the stock.
Teledoc Health (TDOC) is a long term play on telemedicine, an emerging growth stock with huge potential of digital connectivity using smart phones. We picked TDOC at JP Morgan at $54.50 and although choppy it has delivered a breakout to $85 and is now at $76.31. The stock is pricey at P/S 10.54 but sales QtQ are growing at 24% with EPS QtQ growth at 17.3%. Analysts rating is a strong 1.8. Recently the Company moved into personalized nutrition counseling showing the growth potential of the platform,
Our core large cap biopharma holdings are: ABBV, BMY, GILD, MRK and RHHBY.
We have trading profits overall in mRNA stocks : ALNY DRNA MRNA.
Disclosure long AMRN, GNMK and TDOC. Trading XBI.