Update-2 5/4/24: a great week for SMID biotechs here are some winners;
- From our trading list stocks near 52 week highs: ADMA, ADPT, BBIO, CPRX, EXEL, GH, RYTM.
- XBI at $83.50 down 7.28% YTD, up 3.6% past month in an uptrend, 12 mo. high $104.18.
- New buy and adds/holds past month: BBIIO, RZLT, RYTM,SUPN, XNCR.
- Holds off bottom finally after one month?: QDEL, SLDB, VIGL, WVE.
- Best stocks for trading: TEM,XBI,
- IBB flat down 4.54% down YTD at $126. level; XBI bottom on April 8 at $69 level after tariffs announcement.
- LONG term holds/trades over one year: ADPT,CPRX, CRMD, SUPN, VCYT.
Our SMID biotech stocks are based on a momentum model we are developing.
We are developing a trading model based upon a criteria that we can eventually quantify, but for now ls based upon technicals and our knowledge of the market and technology. For example, we screened the companies for having adequate financial resources, balance sheet, product pipeline, analyst coverage, management team etc. We can then track news and product milestones to see if the valuation gets a bump up that holds. This model is an ambitious goal which we would transition to an algorithmic model. From the aspect of risk and portfolio management SMID life science stocks should represent about 5-10% or less of any healthcare portfolio.
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Update-1 5/2/25: 2:45 EDT -Adaptive Biotechnologies (ADPT) Q1 Revenue grew 34% to 52.4M and raised guidance to $180M -$190M for 2025. Net loss was $29.M vs $47.8M in same Qtr for 2024. The stock soared 38% to $9.98.
- BIG Movers in SMID biotechs: CRSP, CYRX, NTRA, QDEL, SLDB, TEM, TWST, TXG, and Xencor (XNCR) a new buy. Of course many are coming off 2025 lows.
- Tracking ETFS are all up: ARKG up 5.7% to 23, IBB up 1.55% to $126.82, XBI up 2% to $84.
Mini Update 5/1 Movers Up: CRMD 4.77%, GPCR 1.48%, EYPT 4.4%,RZLT 5.35%,SLDB 9.8%, VIGL 23.8%, WVE 2.91%. All up without help from IBB or XBI.
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Small and Mid-Cap BIotech Stocks are Ready to Run
- Recent momentum in SMID life science stocks may be saying that the macro-tariff grim news is getting tiresome for traders.
- The XBI is up 4.87% over past 5 days, the IBB is up 3.47%. And large cap biopharma earnings were good thus far .
- Look for sentiment shift from upcoming scientific meetings.
Today started off with the NASDAQ down over 2% then started turning around about 10 a EDT. I did not see the news that may be related to this reversal but it was amazing to me. Both the IBB and the XBI are in an uptrend and seasonality for scientific meetings at this time of the year its good for biotech with the AACR, RNA and later in JUNE ASCO. So I checked my list of SMID biotechs and review my portfolio and voila-a lot of green. So if you are an experienced trader get ready to buy one of those stocks on your “watch” list.
Consider that most large cap pharmaceutical earnings are good (with cautionary guidance on tariffs) and Its time to step up smaller, ” bolt-on” M&A and licensing deals. So this dealmaking would confirm the trend. And with the Administration cutbacks in NIH and University for early stage life science R&D, it could be that 2025 could be a great time to partner with the best small companies.
We will be updating our SMID trading list over the weekend but here are several trades that look interesting: ABSI, BBIO, CPRX, EYPT, IMVT, ROIV, RNA, RYTM. SLDB, SUPN, VIGL,WVE, XNCR. We have already traded these stocks off the recent lows: CRMD,RZLT,TEM, XBI. We will refine this list throughout the next 5 trading days.
Trump 2.0 has enough problems with tariffs and bad press to take on pharmaceutical transfer pricing which are more complex and could end up raising drug prices for consumers. If deregulation is coming so is M&A.