SMID Biotechs Are Gaining Momentum
- Genomics and Precision Oncology are driving cancer diagnostics and targeted therapy.
- Small and mid cap stocks show momentum and breakouts.
- Large cap biopharmaceuticals should anchor your portfolio.
Information Technology and “compute” stocks support the S&P 500 for 9th straight week of gains. We know it’s hard to focus on biotech. But consider some trades in biotech for relief from AI.
Natera Inc. (NTRA) ..$223…Mkt Cap.$32B, RSI 62.36,Analysts 1.3, Fwd PE -. A former high flyer that soared from $140 to $240 then dipped to $200 after Q1 showed no earnings improvement. The stock recently got a boost from the $200 level after announcing upcoming presentations of data at ASCO on their SIGNATERA cDNA test for Melanoma and other MRD tests for targeted oncology. The Company recently announced a plant expansion in Austin TX. Last week we added new positions in the stock
Personalis (PSNL) $11.40. Mkt Cap $1.19B, Analysts 1.19 .RSI 85.51 Fwd PE nil. Stock was $5 in early May! ASCO data coming. Partnered with TEM who owns shares. Given the meteoric rise in shares is a deal imminent?
Posted last week:
“Beginning last year we expanded coverage of” Diagnostics and Tools stocks “particularly the application of Precision Oncology and MRDs. On our Trading List we have reviewed the following stocks in Cancer Dx utilizing genomics: ADPT, GH, ILMN, NTRA PSNL. Our best pick over the past year has been Guardant Health (GH) up 16% YTD and 220 % over one year. Last week their Guardant360 Liquid CDx Panel was FDA approved for a more complete actionable view of cancer from a simple blood draw. many of these stocks are well off their highs and quite volatile.Today Personals (PSNL) announced the they will present new cancer detection data at ASCO. We traded Natera (NTRA) up 33% over one year but down 11 % YTD. But Natera has good potential to move up up In the next 30 days with 35 abstracts and 3 Orals being presented at ASCOo their Signatera tool. These Tests are now being used to clinically and you probably know of somebody whose cancer treatment is being monitored.”
RECENT SMID Biotech Movers we hold:
Absci Corp ABSI $6.75 The stock has been on our trading list since late last year and we added to it in April and with the BTIG upgrade it has doubled and now has a market cap of about $1B. ABSI is an antibody based therapeutics Company withe a brand pipeline but focused in Prolactin biology.
Axsome Therapeutics (AXSM) $234 up 28% YTD, An emerging leader in mental health and MDD with a broad CNS pipeline. Q1 product revenue was $191.2 , 57% YoY growth in sales.
Caribou Biosciences (CRBU) $2.36 up 48% YTD. Mkt cap $234M,A 1.99 P to cash ratio and a 1.0 analyst rating.. A gene editing Company that has a growing pipeline In CAR-T cell therapy. and CRSPR.
PTCT Therapeutics (PTCT) $73.85. NEW pick. Two recent upgrades by T.D.Cowen and Jeffries. Up 14.4% in one month. A broad portfolio for rare diseases with multiple partners; $226 M of product revenue with 36% QtQ growth.
Waters Corp, (WAT) $383. Mkt, Cap $37.7B,NEW Pick. Up 12.5% 5 days, 1% YTD, 4 EPS beats in recent quarters, Mass spectrometry leader.
There are three ETFs to track SMID biotechs: the ARK Genomic Revolution (ARKG) , the iShares Biotechnology (IBB) , and of course the XBI. Now we have a seasonal factor where Mid-cap growth Investment Banker Meetings and ASCO come into play. Another important ETF to track is the Russell 2000 (IWM) which followed last week’s rally closely. We hope to add to our Trading List and cover clinical breakthrough news in late May and June. The Genomics theme is still strong within biotech and will show its capability in Molecular Diagnostics and Precision Oncology and Targeted Therapies.
LONG: ABSI, AXSM, CRBU, GH, ILMN, NTRA, PTCT, WAT.