Update-1 1/14/25…Further Updates from JPM Healthcare will be delayed due to WEB Publishing issues (hacks) and travel plans.
1/15/25…10a EST –Core CPI is 0.2% lower than 0.3% expected so its a GREEN SCREEN Day— RISK ON.
JPM Healthcare Conference Day One: 43rd Annual Conference
We are not attending this year but we’ill bring you significant news from stocks we follow. If you have been reading our articles over the past year you know that healthcare has been a laggard sector in 2024 and biotech has been weak especially toward the end of the year. So what we hope to glean from this Conference is sense of recovery for the healthcare which because of its size in the trillions of dollars and its need for disruption offers big opportunities ahead. The technologies exist for development of new drugs, tools and services to improve patient care for example molecular diagnostics, targeted therapies and DNA sequencing. Now maybe you can see the application of AI models for drug discovery and data analytics.
Our objective is to offer stock picks, portfolio models and strategic trends from this meeting building upon the 20 years of experience in writing the RAYGENT market letter. By the end of the week we will summarize major trends.
During our last posts we broke down the market into the following stock groups: Large cap biopharmaceuticals, SMID Life Sciences and MedTech and Tools/Diagnostics.
For today here some key stock movers and deal news:
The market recovered a little bringing the Dow and S&P 500 in the green, The NAZ came back in last hour but was still down 0.38% probably because the treasury yields remained high with the Ten Year at 4.8%. The big gains of 20%+ in 2024 were driven by technology stocks primarily the MEGACAP techs and NASDAQ in a momentum mode which has ebbed considerably.
Large cap healthcare stocks came back with XLV up 1.3% to $141.61, the IBB was up 0.97% to $134 and the XBI was down 0.35% to 89.13 illustrating the lack of momentum for smaller caps. UNH a core holding for most healthcare portfolios gained 3.9% to $541. From our SMID cap trading list we had the following 2% up movers on a down day: BBIO up 16%, DNLI up 2.57%, GH p 3.8%, ILMN up 5.51%, VCYT up 2.99%. Guardent Health (GH) up 57% 1 yr and Veracyte (VCYT) up 61% 1 yr, have been among our best picks over one year.
- Illumina (ILMN) moved aggressively to leverage their strength in sequencing and genomics with a blockbuster deal with NVIDIA the leading platform AI player collaborating for precision health and drug discovery.
- Guardent Health (GH) released preliminary results showing top line revenue growth of 29% with oncology and pharma tests.
It has become a risk averse market since mid November wiping out most gains since so now investors are starting to favor larger caps. Most of our holdings did welll today and some details will be provided on our optics: ABBV, LLY, GILD,PFE and VRTX. We also like BMY and even Regeneron (REGN) a showed a nice 2.97% gain. Here are some of the other major deals of the day:
- JNJ eked out a 1.75% gain on a $15B acquisition of Intra-Cellular Therapies (ITCI) strengthening their neuroscience portfolio with CAPLYTA an FDA approved drug for major depressive disorders and with other potential CNS indications.
- Gilead Sciences (GILD) consolidated its gains over the past year with an R&D deal for an oral STAT 6 inhibitor in inflammatory diseases with LEO Pharm.
Two of the leading MedTech and Diagnostic tools companies presented today both Danhaer (DHR) and Thermo Fisher TMO) showed gains of more than 2% and will release earnings later this month.We own Fidelity Medical Technology and Devices Portfolio (FSMEX) that is a good play for this sector. Many other stocks in the tools sector showed nice gains today: A< BRKR, EXAS,TECH,WAT.