3 Top Biotech Stocks To Buy Or Sell This Week?
Biotech stocks have been exciting to follow in 2020 so far. The SPDR S&P Biotech ETF (XBI Stock Report) is up 27% year-to-date. One reason is that these companies are at the forefront of vaccine research. As the COVID-19 pandemic continues to wreak havoc globally, these biotech companies race to find the vaccine. Every day, we hear news of these companies’ progress on the COVID-19 vaccine. These top biotech stocks will skyrocket upon a successful trial. But bear in mind numerous setbacks could happen at any stage of the clinical trials, even at the final stage. And when that happens, there is a good chance that some of the stocks will nosedive. These stocks are therefore very volatile given their circumstances.
Finding the best biotech stocks to buy can be tricky given the uncertainties that often haunt the space. Clinical plans don’t always come to fruition even though they might show highly promising results in the beginning. But when they do, investors are sure to reap great benefits from the huge upside. When it comes to investing, managing risks should be your utmost priority. After all, there are plenty of COVID-19 vaccine stocks to invest in, but their risk profiles vary too. If you have a bigger risk appetite, then by all means take a chance at those companies with a singular focus on developing a coronavirus vaccine.
On the flip side, if you can’t stomach the high volatility, then you could consider some of the top pharmaceutical stocks who are working on a COVID-19 vaccine but also have huge portfolios of other drugs under their belt.
Of course, if you have been following the vaccine news, some of the best biotech stocks you may know include Pfizer (PFE Stock Report) and Johnson & Johnson (JNJ Stock Report). Pfizer’s and BioNTech’s vaccine candidate is slated to release their clinical trials at the end of this month. Could it potentially be the first vaccine to be safe and effective for public use? We will have an answer soon. Meanwhile, there are also a few biotech stocks making significant progress on the COVID-19 vaccine front. Let us dive into some of the up and coming biotech stocks that might just be the dark horses that win the race.
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Best Biotech Stocks To Buy [Or Avoid]: Vaxart
First biotech stock on this list is Vaxart (VXRT Stock Report), which outperformed the S&P 500 in September. In fact, the company’s vaccine has something that other leading candidates don’t; the vaccine comes in oral form. Now, vaccine shots are typically most effective because of faster absorption because muscles have greater blood supply and can hold a greater volume of medication. Yet, the pain and discomfort of injections causes fear in many people. Which is why there may be a role for an oral vaccine. Investors looking for stocks with high potential growth may want to include VXRT stock on their watchlist.
The other advantages of oral vaccines are the ease of storage and transportation. The importance of these factors can’t be overstated when we are in a pandemic. After all, it is crucial to distribute the vaccine as fast as possible. All these points in favor of Vaxart’s COVID-19 vaccine candidate. On September 14, the company said that the FDA had allowed it to begin a phase 1 clinical study for its candidate. The news drove Vaxart’s stock up.
For investors looking for a short-term flip, VXRT stock appears to be a good one to bet on. That’s due to its significantly smaller market cap compared to other vaccine candidates. This is in addition to several potential catalysts, which include the efficacy data from a study of its experimental coronavirus vaccine candidate on hamsters. There’s a great chance where investors could bid up VXRT stocks in the short-term. However, that is not without risks. Certainly, any positive news could serve as a catalyst to Vaxart. But anything which smells even slightly negative will send VXRT stock tumbling. With that in mind, is VXRT your type of vaccine stock?
Best Biotech Stocks To Buy [Or Avoid]: Vir Biotechnology
Vir Biotechnology (VIR Stock Report) has had a good week. The company saw its share price rise 16.9% following the news that its latest COVID-19 antibody treatment – a joint venture with GlaxoSmithKline (GSK Stock Report) will enter Phase 3 trials. Results could become available as soon as the end of the year. The promising properties of the candidate may have contributed to Vir’s rise in recent months. In the last month alone, VIR stock has gone up nearly 40%.
Vir and Glaxo aren’t the only companies hoping antibodies will help coronavirus patients recover. After eleven months into the pandemic when the virus first discovered in Wuhan, the field is now packed with Phase 3 trials.
Moreover, there is concern that an effective vaccine will eliminate the need for COVID-19 drugs, as prevention is always better than cure. That said, COVID-19 treatment is still an area to watch, especially since the infection rate is still not on the decline. Assuming we have a promising vaccine result today, ramping up for global production and distribution is not something we can achieve in a few weeks or months.
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Best Biotech Stocks To Buy [Or Avoid]: Novavax
Novavax (NVAX Stock Report) is probably the best performing biotech stock in the stock market year-to-date. The company has witnessed its share price skyrocketed more than 2,300% as of Thursday’s closing. Cantor Fitzgerald and J.P. Morgan analysts even think that Novavax’s NVX-CoV2373 could be the best of the leading COVID-19 vaccines in development. Novavax has reported overwhelmingly positive results for a late-stage study of the experimental flu vaccine NanoFlu. Thus, the company is currently pursuing the Food and Drug Administration for approval of this vaccine Should Nanoflu obtain regulatory approval, the drug could generate sales of up to $1.7 billion.
This isn’t the only vaccine Novavax is pursuing as they too are in the race to develop a COVID-19 vaccine. Their candidate, NVX-CoV2373 has announced positive results from their phase 1 study in August. This prompted analysts to declare this vaccine as the best-in-class among the vaccines under development. The company expects to begin a phase trial in the U.S. this month.
The U.S. Government has signed a $1.6 billion agreement with Novavax to fund late-stage development and manufacturing of its COVID-19 vaccine. Therefore, this could poise Novavax for a very successful 2021. Along with the fact that they too are expending their vaccine production capabilities by announcing a deal with a manufacturer in India to produce a billion doses of COVID-19 vaccines annually.
With establishments in eight countries, analysts estimate that Novavax could be producing up to 2 billion doses in 2021. As more evidence suggests that COVID-19 could be seasonal in the future, vaccine availability and efficacy will be crucial as the world adapts to the aftermath of COVID-19. Is NVAX stock still the best biotech stock to buy now?