Are These The Best Biotech Stocks To Add To Your List Before December?
Going into December, the top biotech stocks continue to flourish. It has undoubtedly been the year for biotech companies in the stock market as they are essentially the frontline industry in the fight against coronavirus. The past month has seen several players in the industry announce their vaccine candidates. Moreover, most of them are in the home stretch of getting their vaccines approved by the U.S. Food and Drug Administration (FDA). All these leaders in the race have seen a substantial rise in their respective share prices. For example, BioNTech’s (BNTX Stock Report) and Moderna’s (MRNA Stock Report) share prices have doubled in the last six months. Understandably, both of these companies have vaccine candidates showing efficacy of roughly 95%.
In fact, according to an ongoing study by Duke University in the U.S., there are nearly 200 coronavirus vaccine candidates in the making as of last week. Ten of them are already in Phase 3 large-scale trials with several applying for emergency authorization. Another key point to note would be to advance market commitments (AMCs). AMCs involve countries and multilateral partnerships looking to reserve vaccine supplies before they obtain approval for use in the general population.
Vaccines are not sold for much, however, the real source of revenue lies within the volume that any biotech company sells. No matter how successful any given biotech company is, manufacturing capacity is a growth limitation factor to consider. At StockMarket.com, we have been saying that coronavirus vaccines are not a winner-takes-all market. Therefore, there could be more entry points into this industry than meets the eye. Despite all the success stories, here is a list of top biotech stocks to watch going into December.
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Top Biotech Stocks To Watch In December: Sorrento Therapeutics Inc.
The first entry on this list is Sorrento (SRNE Stock Report). Sorrento is based in California and has been around since 1989. It is a clinical-stage, antibody-centric, biopharmaceutical company developing new treatments for coronavirus, cancer, and pain. To point out, the company has an extensive array of immunotherapy research platforms. This includes fully human antibodies, clinical-stage cellular therapies, and most importantly, antiviral therapies and vaccines for coronaviruses. Sorrento’s share price has gone up by about 10% this month alone.
In its third-quarter fiscal released in early November, the company reported a 103% rise in revenue year-over-year. Evidently, this is the result of a 106% increase in net product revenue and a 97% rise in service revenue at the same time. It also reported a 116% year-over-year increase in cash on hand. Moreover, the company acquired gene-coded protein therapeutics company SmartPharm Therapeutics for $19.5 million in September. All things considered, the company is seeing steady growth.
Particularly, why are investors watching Sorrento this week? Simply put, its newly acquired subsidiary SmartPharm is already bringing in massive returns. On November 27, SmartPharm secured a $34 million contract with the U.S. Defense Advanced Research Projects Agency (DARPA). Basically, this agreement is focused on the development of a rapid countermeasure against coronavirus. This contract is definitely a big win for the company as it has gained a backer with very deep pockets. In other words, this could help the company financially with the production of a coronavirus vaccine candidate moving forward. Could this be what SRNE stocks need to soar to greater heights?
Top Biotech Stocks To Watch In December: Novavax Inc.
Top biotech stock Novavax (NVAX Stock Report) is up by over 40% in the past week. The Sweden-based vaccine development company is one of the frontrunners in the coronavirus vaccine race this year. In addition to this, it also has a vaccine candidate for seasonal influenza in phase 3 clinical trials. Surprisingly, Novavax is doing much better than competitors Pfizer (PFE Stock Report) and AstraZeneca (AZN Stock Report) this week. Let us take a deeper look into this recent success.
In its most recent quarter fiscal, the company reported a jaw-dropping 6163% rise in revenue year-over-year. This is thanks to its increased development activities related to its coronavirus vaccine. As a result, the company also saw a 1480% increase in research and development costs year-over-year. Novavax has obviously leveraged its position as a big coronavirus vaccine player despite lagging behind its rivals. Regarding its vaccine release schedule, CEO Stanly Erck said, “With multiple clinical trials ongoing worldwide, we expect initial efficacy data potentially by early first quarter 2021”. What could Novavax bring to the table that sets it apart from its competitors?
Namely, the company has two key advantages. First would be its announcement for a potential two in one vaccine. In October, the company expressed interest in integrating its NanoFlu seasonal influenza vaccine with its coronavirus vaccine. On this front, it would be a step ahead of its competitors. Secondly, Novavax claims to be able to produce up to 2 billion doses of its coronavirus vaccine by mid-2021. This is the second-largest projection in the industry behind AstraZeneca’s 3 billion doses. However, in light of AstraZeneca’s candidate coming under scrutiny by the World Health Organization, Novavax appears to have the edge for now. All things considered, does NVAX stock deserve a spot on your watchlist?
Top Biotech Stocks To Watch In December: Inovio Pharmaceuticals Inc.
Last but not least, we have Inovio (INO Stock Report). Inovio is a biotech company that is based in Pennsylvania. The company is mainly focused on the discovery, development, and commercialization of synthetic DNA products. To elaborate, these products are used to treat cancers and infectious diseases. Notably, its share prices are up by over 10% in the last week.
To say that Inovio posted polarizing results in its recent quarter fiscal released earlier this month is an understatement. Surprisingly, the company reported a 72% decrease in revenue year-over-year. However, this was met with a 1027% rise in cash on hand at the same time. When faced with these kinds of results, seasoned investors often look beyond the gains and losses of a company. As you may or may not know, Inovio has several potential future growth drivers on its development pipeline.
Admittedly, one possible reason for the popularity of INO stock this month would be that the company announced the start of phase 2 clinical trials for its coronavirus vaccine. To sweeten the deal, the U.S. Department of Defense (DoD) will be funding the endeavor. This is in addition to the $71 million previously announced in June for another project involving Inovio. On the other hand, the company is also working on other key programs. This includes treatments for pre-cancerous cervical dysplasia and glioblastoma multiforme which is an aggressive form of brain cancer. With its large repertoire of projects, Inovio appears to have big plans going into 2021. The question remains, will all this be enough to make INO stock a top biotech stock that is worth buying?