7 Biotech Stocks That Are Buys Right Now
Zacks Investment Research | Jun 16, 2016 11:00PM ET
Even into the sixth month of the year, the happening yet highly unpredictable biotech sector continues to struggle – the NASDAQ Biotechnology Index is down 20.1% year to date. In addition to weak balance sheets and mounting political pressure on drug prices, the larger issues plaguing the economy are continuing to weigh upon the sector.
Still biotechs retain their charm with investors who unfailingly bet on these stocks when fundamentals are strong and valuations reasonable.
Mergers and acquisitions continue to dominate the sector with Shire combining with Baxalta earlier this month and rumors of a few biotech companies chasing lucrative deals refusing to die down. Large-cap and development-stage companies continue to partner across different therapeutic areas like immuno-oncology, hepatitis C virus and cardiovascular to bolster their pipelines.
Moreover, several high profile drugs like Gilead’s Genvoya (HIV) among others that gained approval last year should help drive top-line growth at these companies. They would also continue to benefit from label expansion of existing drugs.
Considering these factors, the sector still holds promise and could bounce back in no time particularly when there are significant catalysts lined up for the second half in the form of key new product approvals and major data read-outs.
Though there are a plethora of stocks, some could emerge as winners while others fall by the wayside. Here are seven such biotech stocks which are sanguine buys right now.
Best Biotech Picks
San Diego, CA-based Retrophin, Inc. (NASDAQ:RTRX) is a commercial-stage biotech company focused on the development of rare diseases treatments. The company derives revenues from three marketed products – Chenodal, Cholbam and Thiola. The company expects top-line data from the phase II study on its lead pipeline candidate sparsentan for the treatment of focal segmental glomerulosclerosis in the third quarter of 2016. This Zacks Rank #1 (Strong Buy) stock has seen its current quarter loss per share estimate being narrowed by 3.57% over the past 60 days.
Sunesis Pharmaceuticals, Inc. (NASDAQ:SNSS) is a development-stage biotech company focused on the development and commercialization of oncology therapeutics for the treatment of solid and hematologic cancers.
Currently, Qinprezo is the most advanced program, being evaluated for the treatment of relapsed or refractory acute myeloid leukemia. Also, the company is advancing its kinase-inhibitor pipeline of novel targeted therapies into the clinic. The current quarter loss per share estimate of this Zacks Rank #2 stock has narrowed by 7.69% over the past 60 days.
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