Update: 6/7/24.,,Our model still looks good for experienced traders.Today for example GERON (GERN) soared 19% with approval of RYTELO for MDS associated anemia. We will summarize news from winning stocks over the weekend. XBI was weak today down about 1% to $91 handle. Strong jobs could mean no rate cuts from FED.
- Rally in XBI stocks may be over already?!
- Selected winners: ADPT, CRMD, GERN, IMTX, NTRA, NVAX, TWST,VCEL.
- 11:30a tape went negative for SMID biotechs as momentum eases.
UPDATE 6/5 11a EST…SMID caps in a rally with XBI up 2.45% to $93.44. ALSO ADPT, NVAX TWST etc.
So the MOMENTUM model is working in biotech but I do not have time to report on the moves because tech stocks especially semiconductors are running wild due to “AI effect” and NVDA.
UPDATE 6/3 10 am EDT: ASCO takes XBI up 3% to 92++. Green screen potential today with 95% of SMID caps up as of 11:20a.
- NVAX up 16%
Update-3: Large cap biopharmas were strong on Friday in anticipation of #ASCO24 data. Company news to watch from data below:AZN, BMY, GILD, LLY, MRK, PFE and also ADPT,NVS.
- SMID cap stocks looking better: ADPT, CPRX, EXEL,GERN, NTRA, NVAX, VCEL, VCYT.
UPDATE -2: Market recovers quickly from early losses to end up: S&P 500 up 0.8%,DOW up 1 .5%. Large caps biopharmas romp!
Update-1 Red Screen Alert: Almost every SMID biotech stock is down with XBI down 1.65%, IBB down 1.17%!
5/31….up today: EXEL, GERN, SUPN, TWST, XBI recovers to $89.18, IBB up slightly to 133.88.
5/30…10:20 am,,,Now look for stocks that snap back quickly from sell-off: CPRX, NTRA, NVAX,VCEL,VCYT……..
Life Science Momentum Trades-Seeking Innovation
- SMID Life Science Trades are based on a momentum model- technicals are important.
- Stock picks screened for balance sheet, technology and analyst coverage, most have a market cap over $1B.
- Objective is to discern trends and long term appreciation of stock.
We have been developing a trading model based upon a criteria that can eventually quantify but for now based upon technicals and our knowledge of the market and technology. For example, we screened the companies for having adequate financial resources ,balance sheet, analyst coverage, management team etc. We can then track news and milestones to see if the valuation gets a bump up. This model is an ambitious goal which we would transition to an algorithmic model. From the aspect of risk and portfolio management SMID stocks should represent about 10% or less of any healthcare portfolio.
Based on parameters we track now momentum has stalled and is market neutral.
Here are some points to consider when trading these stocks:
- ETF correlation is a good place to start. The XBI is an equal weighted biotech fund that gets rebalanced frequently to show the overall strength of the market. If the XBI shows momentum your speculative stock will probably show gains,
- In a bull market like 2021-22 almost all well researched spec picks with sponsors went up. In today’s more neutral /bear market stock picking is more difficult so better play the long term with a Fund or an ETF.
- Many of these stocks have been good for traders for short term results but our objective is to find the big winner in a burgeoning market like sequencing about 8-10 years ago.
- This is NOT a buy list and we will modify it from time to time. Last columns shows stock performance YTD and short term trend.
Here are several SMID stocks in 2024 that we still hold: ABAX, ADPT, CRMD, GERN, NTRA, NVAX, SUPN, VCEL,VCYT. Here are stocks where we have incurred losses: CYRX. PACB but all buys and sells are not listed. The flaw for the model is the difficulty in tracking so many stocks case in point being PACB a former high flyer that has fallen from 11 to 1.87 within 9 months.
| P 1/20/23 | % Perf | 2/4/23 | 12/24/23 | 4/8/24 | 5/26/24 | |||||||||||
| Company | Ticker | $ | P | YTD % | YTD | %YTD | trnd | |||||||||
| P | P | % | P | st | ||||||||||||
| Acumen Therap | ABOS | 5.29 | 3.57 | -33.89 | 3.17 | -17.45 | 3.4 | -11.46 | u/- | |||||||
| Adaptive BiioTech | ADPT | 4.11 | 5 | 2.6 | -46.94 | 3.44 | -29.8 | u/- | ||||||||
| Catalyst Pharma | CPRX | 16.1 | 16.58 | -10.86 | 14.89 | 11.42 | 15.87 | -5.59 | u/- | |||||||
| Caribou Biosci | CRBU | 6.29 | 6.17 | -0.175 | 3.71 | -35.25 | 2.97 | 3.71 | d | |||||||
| CorMedix | CRMD | 3.9 | 5.31 | 41.22 | 5.12 | 36.17 | u | |||||||||
| Crenetics | CRNX | NEW | 42.12 | 18.38 | 47.47 | 33.42 | u | |||||||||
| CRSPR Therap | CRSP | 49.61 | -25 | 55.27 | 63.67 | 56.63 | 53.91 | -13.88 | 55.24 | -11.76 | – | |||||
| Cryoport | CYRX | 21.75 | -42.34 | 25.24 | 16.09 | -7.26 | 16.38 | 5.75 | 11.04 | -28.74 | d | |||||
| Cytokinetics | CYTK | 31 | 65.34 | -21.74 | 48.3 | -42.15 | d | |||||||||
| Denali | DNLI | 22 | 19.21 | -9 | 18.31 | -10.48 | u | |||||||||
| Exelixis | EXEL | 22.25 | 23.75 | -1.21 | 20.57 | -14.26 | d | |||||||||
| Evolent Health | EVH | 30.83 | 13.74 | 31.96 | 32.08 | 14.25 | 27.65 | -16.29 | 23.8 | -29.52 | d | |||||
| Geron | GERN | 3.19 | 9.24 | 3.22 | 2.29 | -5.37 | 3.79 | 79.62 | 3.48 | 64.93 | – | |||||
| Immatics | IMTX | 9.3 | 9.9 | 13.66 | 10 | -4.94 | 11.7 | 11.11 | u | |||||||
| Natera | NTRA | NEW | 60 | 91.66 | 46.33 | 109.51 | 74.82 | u | ||||||||
| Pacific Biosci | PACB | 11.29 | 55.68 | 11.58 | 8.59 | 5 | 1.47 | -85 | 1.87 | -80.94 | -/u | |||||
| Novavax | NVAX | NEW | 3.67 | – | 15.5 | 222.92 | u | |||||||||
| Recursion Pharm | RXRX | 10.75 | 8.12 | -17.65 | 9.16 | -7.1 | u | |||||||||
| Roivant | ROIV | 11.4 | 11.03 | -1.78 | 10.98 | -2.23 | u/- | |||||||||
| Supernus | SUPN | 40.3 | 12.3 | 41.61 | 29.23 | -18.05 | 30.07 | 3.9 | 27.51 | -4.94 | d | |||||
| Twist Biosci | TWST | 18 | 3.76 | 34.03 | 31.54 | -14.53 | 42.33 | 4.57 | u | |||||||
| 10x Genomics | TXG | 47.84 | 56.58 | 55.27 | 27.59 | -50.79 | 22.59 | -59.63 | d | |||||||
| Vericel | VCEL | 31 | 34.75 | 31.93 | 46.05 | 29.32 | 48.23 | 35.44 | u | |||||||
| Veracyte | VCYT | 24.89 | 39.43 | 26.67 | 28.27 | 19.13 | 19.31 | -29.81 | 20.8 | -24.39 | – | |||||
| Tracking | ||||||||||||||||
| SPDR Biotech | XBI | 86.99 | 14.75 | 90.39 | 87.62 | 5.57 | 83.49 | -6.51 | 88.83 | -0.52 | – | |||||
| iShares BIO | IBB | 133.77 | -1.89 | 132.51 | -2.48 | 135.67 | -0.13 | u | ||||||||
| HealthcareSPDR | XLV | 135.02 | – | 143.22 | 5.02 | 144.42 | 5.9 | u | ||||||||
| wildcard | ||||||||||||||||
| ArkGenomics | ARKG | 35.28 | 32.81 | 16.22 | 23.18 | -29.35 | 25.63 | -21.88 | u | |||||||