Biotech Stocks To Watch If You’re Concerned With Covid-19
Biotech stocks have been on a tear this year thanks to speculation about potential vaccines or treatments for Covid-19. Everyday investors wake up with the hope that a safe and effective vaccine has been found. Biotech stocks, as measured by the iShares Nasdaq Biotech ETF (IBB Stock Report), started to rally furiously since the beginning of 2020. And because of that, inventors have been looking for the top biotech stocks to buy.
Given the amount of attention paid to Covid-19 treatment and vaccines, the stock market will attract a fair share of speculators or value investors in the space. The top biotech stocks to watch are either those that have a strong streak of earnings growth or those that have increased more than 20-folds or more in the year 2020. Yes, you read that correctly. More importantly, there isn’t just one of them that had such a massive breakout. By now, most top coronavirus stocks that have their hand on vaccines or treatments are mostly at a later stage. This in effect requires less filtering to do when choosing a biotech stock to buy.
For investors looking for places to put their money in the midst of uncertainty about the direction of the pandemic, biotech companies with strong potentials could hold promise in the long term. There is no better time for investors to focus on the biotech space. The industry stands to see stock price gains during the pandemic. With all that in mind, are these biotech stocks on your watchlist this month?
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Top Biotech Stocks To Buy [Or Avoid]: Novavax
If you are an early investor for Novavax (NVAX Stock Report), then you are one of the luckiest investors we all know. By early, I mean you are an NVAX stock investor since the beginning of this year. And if you did hold your investments until today, you would have made nearly 3,000% return. It is so tempting to take profits and leave. That’s considering NVAX stocks have been skyrocketing since the beginning of the year. With the company recently joining the government’s Operation Warp Speed, many analysts consider NVAX one of the front-runners in the race for a vaccine. Many analysts raised their target price for NVAX stock to an average of $140. Should these analysts be right with their predictions, the company still has a lot of upside left.
With the inclusion under Operation Warp Speed, there’s a great chance that NVAX would command a significant market share in the vaccine market if it’s really successful. Novavax expects to publish the phase 1/2 clinical trials study before the end of July. If the results are positive, we could see another breakout in NVAX stock.
On the flip side, if it fails to impress the clinicians when the data is out, there’s a risk that NVAX stock could come crashing down. But that’s the reality of early-stage biotech stocks, isn’t it? If you are able to stomach the risks, NVAX stock remains one of the best biotech stocks to watch right now.
Top Biotech Stocks To Buy [Or Avoid]: Gilead Sciences
There are plenty of drugmakers racing to develop potential treatments for Covid-19. But so far, only Gilead Sciences (GILD Stock Report) has gotten to late-stage testing. Thus far, the company’s remdesivir drug appears to be working effectively in treating Covid-19 patients. As you may or may not know, Gilead’s main focus has been on the intravenous form of remdesivir. However, the company announced last week that it had initiated a phase 1a clinical study evaluating an inhaled solution of remdesivir. The company speculates that using a nebulizer to deliver an inhaled solution could be more effective for a faster recovery. But, let’s not get our hopes all high up. Because the odds of any infectious disease drug in a phase 1 study going through to an FDA approval are less than 20%.
From the investors’ perspective, many would expect the treatment for Covid-19 to be a major catalyst for GILD stock. But the truth is, there are also many Covid-19 patients who don’t show any symptoms. Some of these patients could recover without the help of any drug. For this reason, it would be better not to bet on remdesivier to become a long-term commercial success for Gilead. Instead, we should focus on the company’s other potential catalysts.
Notably, filgotinib for treating rheumatoid arthritis is currently awaiting approval from the US and the EU. In any case, Gilead has a fairly sizable portfolio of products. Therefore, the performance of GILD stock will not be solely reliant on remdesivir alone.