Biotech Update Near 2025 Highs
- Most of our September Posts are Relevant today as the biotech sector is at 2025 highs YTD: XBI up 15.1% at $103.68, IBB up 13.8% at $150.48. Note that the odes and one of the most followed life science mutual funds Fidelity Biotechnology Portfolio (FBIOX) is up 22% at $23.01.
- Large caps should be the foundation of your portfolio because they are good value with PEs in the teens and top picks doing well if you owned a basket of them: ABBV up 31% YTD at $232.83, GILD up YTD 26.4% at $116.79,LLY up YTD 9.28% at $843.63, VRTX up YTD 1.88% at $410.28.
- SMID Cap BIOTECHS should be your focus going forward because as we have seen YTD they are explosive and can offer big gains. Our biggest winners YTD have been in the Precision Oncology sector: Adaptive Biotechnologies (ADPT) up 139% at $14.35, Guardant Health (GH0up 107% at $63.44, and new picks at 6 mos. Personalis (PSNL) up 133% at $7.57, Xencor (XNCR) up 43.7% at $12.03.
So we are at a transition point in 2025, a meteoric bull market led by AI and Technology stocks but a rally in it’s nascent stage after 9 months. We anticipated that the sector performance of Life Science stocks would catch up to the S&P500 by the end of Q$ but here we are 3 mos. early!
So we need to get through Q3 earnings to see what trends lie ahead and we do expect pick up in M&A.
LONG :all of the above stocks.