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S&P 500   3,719.04 (+1.97%)
DOW   29,683.74 (+1.88%)
QQQ   279.94 (+1.99%)
AAPL   149.84 (-1.27%)
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NVDA   127.36 (+2.60%)
NIO   17.33 (+0.81%)
BABA   80.99 (+4.01%)
AMD   68.36 (+1.77%)
T   15.83 (+0.64%)
MU   51.00 (+0.83%)
CGC   3.04 (+6.29%)
F   12.18 (+2.27%)
GE   64.46 (-0.02%)
DIS   99.40 (+3.70%)
AMC   7.67 (+2.95%)
PYPL   91.12 (+6.26%)
PFE   44.43 (+0.77%)
NFLX   245.20 (+9.29%)
S&P 500   3,719.04 (+1.97%)
DOW   29,683.74 (+1.88%)
QQQ   279.94 (+1.99%)
AAPL   149.84 (-1.27%)
MSFT   241.07 (+1.97%)
META   141.61 (+5.36%)
GOOGL   100.05 (+2.62%)
AMZN   118.01 (+3.15%)
TSLA   287.81 (+1.72%)
NVDA   127.36 (+2.60%)
NIO   17.33 (+0.81%)
BABA   80.99 (+4.01%)
AMD   68.36 (+1.77%)
T   15.83 (+0.64%)
MU   51.00 (+0.83%)
CGC   3.04 (+6.29%)
F   12.18 (+2.27%)
GE   64.46 (-0.02%)
DIS   99.40 (+3.70%)
AMC   7.67 (+2.95%)
PYPL   91.12 (+6.26%)
PFE   44.43 (+0.77%)
NFLX   245.20 (+9.29%)
S&P 500   3,719.04 (+1.97%)
DOW   29,683.74 (+1.88%)
QQQ   279.94 (+1.99%)
AAPL   149.84 (-1.27%)
MSFT   241.07 (+1.97%)
META   141.61 (+5.36%)
GOOGL   100.05 (+2.62%)
AMZN   118.01 (+3.15%)
TSLA   287.81 (+1.72%)
NVDA   127.36 (+2.60%)
NIO   17.33 (+0.81%)
BABA   80.99 (+4.01%)
AMD   68.36 (+1.77%)
T   15.83 (+0.64%)
MU   51.00 (+0.83%)
CGC   3.04 (+6.29%)
F   12.18 (+2.27%)
GE   64.46 (-0.02%)
DIS   99.40 (+3.70%)
AMC   7.67 (+2.95%)
PYPL   91.12 (+6.26%)
PFE   44.43 (+0.77%)
NFLX   245.20 (+9.29%)
S&P 500   3,719.04 (+1.97%)
DOW   29,683.74 (+1.88%)
QQQ   279.94 (+1.99%)
AAPL   149.84 (-1.27%)
MSFT   241.07 (+1.97%)
META   141.61 (+5.36%)
GOOGL   100.05 (+2.62%)
AMZN   118.01 (+3.15%)
TSLA   287.81 (+1.72%)
NVDA   127.36 (+2.60%)
NIO   17.33 (+0.81%)
BABA   80.99 (+4.01%)
AMD   68.36 (+1.77%)
T   15.83 (+0.64%)
MU   51.00 (+0.83%)
CGC   3.04 (+6.29%)
F   12.18 (+2.27%)
GE   64.46 (-0.02%)
DIS   99.40 (+3.70%)
AMC   7.67 (+2.95%)
PYPL   91.12 (+6.26%)
PFE   44.43 (+0.77%)
NFLX   245.20 (+9.29%)

Biogen Is The Comeback Story To Watch

Biogen Is The Comeback Story To Watch With a seven-year trading range of $200 to $400 and every price in between, shares of Massachusetts based Biogen (NASDAQ: BIIB) know exactly what it’s like to be a biotech company where your future depends on your next drug.

Shares are currently bobbing along in the middle of that range after slipping 20% from post COVID highs set in April. It’s been a rollercoaster year, if not a decade, with the coronavirus pandemic only one of many factors that management and investors have both had to overcome.

Court Troubles

2020 started well, with Q4 earnings at the end of January topping estimates and moving in the right direction. Then came a favorable patent ruling in February on the multiple sclerosis drug Tecfidera, which made up 40% of Biogen’s 2019 sales. With that kind of dependence, it’s easy to see why Tecfidera has been a key driver for shares in recent months.

However, fellow biotech Mylan (NASDAQ: MYL), who wants to make a generic version, has consistently challenged the validity of Biogen’s eight years of exclusivity. Biogen’s stock popped almost 40% on the news in early February before sliding into the rest of Q1 as COVID-19 gripped equity markets.

Then in June, a federal court tossed out Tecfidera’s patent protections. Biogen immediately lodged an appeal and the ruling on that may take up to a year. In the meantime, many on Wall Street have started to throw in the towel. Barclays cut their rating on the stock almost immediately after June’s ruling as upwards of 30% of Biogen’s free cash flow was seen to be at risk.


Dodgy Data

Around the same time Aducanumab, the company’s Alzheimer's treatment, was also facing an uphill battle for approval with Raymond James reducing their rating on the stock and saying they couldn’t “go lower than 0% probability” on the drug’s approval chances. Citi shared similar sentiments and gave the stock a street low price target of $240. Multiple questions have been raised about the validity of the drug’s trial data. Even though the company managed to push the submission through for FDA approval at the start of July, few are bullish on the prospects of a positive ruling.

For all this though, the stock has shown some pluck, refusing to go down to the multi-year lows it printed last summer. And with much of the downside baked into the price, the opportunity for an upside surprise increases. The company’s Q2 report last week was just that, as it topped analyst expectations and showed revenue growth year on year albeit only at 1.7%.

Potential Upside

Then on Monday of this week, Morgan Stanley were out with a surprise double upgrade to the stock, moving it straight to Overweight from Underweight. Analyst Matthew Harrison has thrown his lot in on the potential for a positive result with the Aducanumab submission and raised his price target to $357. This would be about a 30% jump from where share’s closed on Tuesday and a welcome reprieve for long-suffering investors.

Biogen has definitely had a bad run of luck and much of the company’s revenues are under threat. However, their price-to-earnings ratio is only 8.2 so it could be said that shares are trading at a significant discount relative to biotech peers. For context Mylan’s price-to-earnings number is 134. It will be a brave investor that backs Biogen at this point but the upside is tremendous if their luck shifts and they get a favorable ruling or two.

With shares close to long term support as we enter the second half of the year and with several yes / no decisions on the horizon, it could be the turnaround story of 2020.

Biogen Is The Comeback Story To Watch

 

Companies Mentioned in This Article

CompanyMarketRank™Current PricePrice ChangeDividend YieldP/E RatioConsensus RatingConsensus Price Target
Biogen (BIIB)
2.0938 of 5 stars
$276.61+39.9%N/A19.73Moderate Buy$268.70
Mylan (MYL)
1.4911 of 5 stars
$0.00-100.0%N/A29.92N/AN/A
Compare These Stocks  Add These Stocks to My Watchlist 

7 Water Stocks to Buy as the World Dries Up

Many of us will read this and be oblivious to the worldwide crisis. But if the current trends continue, it will become real to all of us soon enough. Most of us learned in elementary school that 97% of the world's water is salt water. And only about 1% of the total water supply is drinkable.

That is becoming difficult math for several areas of the world. A severe, multi-year drought is causing water levels to sink to historically low levels. And the federal government is threatening to cut water use by 25% in the most-affected states of Arizona, California, and Nevada.

And even if we're not put under water restrictions, we are all likely to see higher costs for food. One reason for that is that about 25% of the nation's food supply comes from California. An American Farm Bureau Federation survey conducted in 2021 found that 40% of farmers sold off part of their cattle herds.

 But opportunities present themselves in the midst of crisis, and this is no difference. In this special presentation, we're looking at seven water stocks that look like smart buys as the world grapples for solutions.

View the "7 Water Stocks to Buy as the World Dries Up".

Sam Quirke

About Sam Quirke

Contributing Author: Technical Analysis

After graduating with a degree in finance, Sam worked for a trading technology company as an analyst before joining a prop firm. Here he traded energy, commodity and index futures while utilizing a combination of technical and fundamental analysis.Today he manages his own stock and option portfolio which is made up of longer term positions and shorter term momentum plays. He lives in Chicago.
Contact Sam Quirke via email at s.quirke.us@gmail.com.
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