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8 Biotech Stocks to Buy and Hold in 2020

8 Biotech Stocks to Buy and Hold in 2020Posted on Friday, March 27th, 2020 by MarketBeat Staff

Biotech stocks are far from a sure thing. However, towards the end of 2019 several stocks in the sector got a nice lift based on promising new drugs in their pipelines. One of the key ways to measure any biotech stocks is the depth of its pipeline. When a biotech company issues a drug, its stock typically gets a lift because, for a brief period of time, the company has exclusive rights to that stock.

But those rights only last for a period of time. And at that point, generic equivalents can enter the market. Since generic labels typically bring prices down, it can be harmful to the stock unless they have a continuous stream of drugs coming to the market.

And in 2020, the story of biotech companies has been the coronavirus. Several of the leading biotech firms are working either individually or in tandem with other firms to develop vaccines or antiviral therapies to help treat and eventually blunt the spread of the virus which remains foreign to our bodies.

So while a volatile market is typically a clue to stay away from biotech stocks, now may be an ideal time to jump into this sector. And we’ve identified 8 stocks that you can buy today and hold until the end of the year.

#1 - Regeneron Pharmaceuticals (NASDAQ:REGN)

Regeneron Pharmaceuticals logo

Regeneron (NASDAQ:REGN) is one of the most actively traded biotech stocks in 2020. Investors initially traded the stock up when it was named as one of several firms that was developing a vaccine for the coronavirus. However, reality set in when investors realized that a vaccine is months from being approved and ready to deliver at scale.

REGN stock continues to show strength on news that it may have a vaccine ready by August. But that is not certain at all. And the thing with vaccines is that being first is critical.

Investors seem to be digesting that as the stock continues to fight against a level of resistance. Still shares of the stock are up nearly 20% in 2020. And that has a lot to do with the company’s pipeline that includes its headlining drug Dupixent which is used to treat moderate-to-severe eczema. Regeneron may be looking to expand its label for Dupixent in 2020.

Regeneron also continues to show strong sales for Eylea despite the introduction of generic competition and continues to have other drugs in its pipeline.

REGN stock has a P/E of over 23. Analysts have given Regeneron stock a consensus price target of just over $460. However, the two most recent analyst ratings from Oppenheimer and Argus have given the stock price targets of $525 and $540 respectively.

About Regeneron Pharmaceuticals
Regeneron Pharmaceuticals, Inc., a biopharmaceutical company, discovers, invents, develops, manufactures, and commercializes medicines for treating various medical conditions worldwide. The company's products include EYLEA injection to treat wet age-related macular degeneration and diabetic macular edema (DME); myopic choroidal neovascularization; and diabetic retinopathy in patients with DME, as well as macular edema following retinal vein occlusion, including macular edema following central retinal vein occlusion and macular edema following branch retinal vein occlusion. It also provides Dupixent injection to treat atopic dermatitis in adults, and asthma in adults and adolescents; Praluent injection for heterozygous familial hypercholesterolemia or clinical atherosclerotic cardiovascular disease in adults; and Kevzara solution for subcutaneous injection for treating rheumatoid arthritis in adults. In addition, the company offers Libtayo injection to treat metastatic or locally advanced cutaneous squamous cell carcinoma; ARCALYST injection for cryopyrin-associated periodic syndromes, including familial cold auto-inflammatory syndrome and muckle-wells syndrome; and ZALTRAP injection for intravenous infusion to treat metastatic colorectal cancer. Further, it is developing various product candidates for treating patients with eye diseases, allergic and inflammatory diseases, cancer, cardiovascular and metabolic diseases, neuromuscular diseases, infectious diseases, and other diseases. The company has collaboration and license agreements with Sanofi, Bayer, Teva, Mitsubishi Tanabe Pharma, Alnylam Pharmaceuticals, Inc., and others. Regeneron Pharmaceuticals, Inc. was founded in 1988 and is headquartered in Tarrytown, New York.

Current Price: $597.00
Consensus Rating: Buy
Ratings Breakdown: 14 Buy Ratings, 13 Hold Ratings, 0 Sell Ratings.
Consensus Price Target: $551.07 (-7.7% Upside)



#2 - Inovio (NASDAQ:INO)

Inovio Pharmaceuticals logo

Like Regeneron, Inovio (NASDAQ:INO) is working on a vaccine for the coronavirus. And like REGN, the fortunes of INO are largely tied to its success in getting its virus approved first. But also like Regeneron, the company gives investors reasons to be excited beyond its potential to vaccinate against the coronavirus.

In the case of INO, they are working in the field of immunotherapy. They call their process Immuno-Ingenuity. In the company’s own words this is (in part) “the drive to develop novel immunotherapies to fight cancer and infectious diseases.”

Inovio is on the leading edge of the drug market for pediatric brain tumors. This is a market that could be worth $1.65 by 2023. Inovio recently announced that the FDA approved its application to evaluate its drug, labeled INO-3107, which is in development for Recurrent Respiratory Papllomatosis (RPP). This is a rare disease caused by the human papillomavirus (HPV). The disease causes noncancerous tumor growths that lead to life-threatening obstruction of airways. The growths can occasionally progress to cancer.

About Inovio Pharmaceuticals
Inovio Pharmaceuticals, Inc., a late-stage biotechnology company, focuses on the discovery, development, and commercialization of DNA-based immunotherapies and vaccines to prevent and treat cancers and infectious diseases. Its SynCon immunotherapy design has the ability to break the immune system's tolerance of cancerous cells, as well as is intended to facilitate cross-strain protection against known, as well as new unmatched strains of pathogens, such as influenza. The company is involved in conducting and planning clinical studies of its proprietary SynCon immunotherapies for human papillomavirus-caused pre-cancers and cancers; bladder cancer; glioblastoma multiforme; hepatitis B virus; hepatitis C virus; human immunodeficiency virus; Ebola virus; middle east respiratory syndrome; and Zika virus. Its partners and collaborators include MedImmune, Limited; The Wistar Institute; University of Pennsylvania; GeneOne Life Science Inc.; ApolloBio Corporation; Regeneron Pharmaceuticals, Inc.; Genentech, Inc.; Plumbline Life Sciences, Inc.; Drexel University; National Institute of Allergy and Infectious Diseases; United States Military HIV Research Program; U.S. Army Medical Research Institute of Infectious Diseases; National Institutes of Health; HIV Vaccines Trial Network; Defense Advanced Research Projects Agency; the Parker Institute for Cancer Immunotherapy; and Coalition for Epidemic Preparedness Innovations. Inovio Pharmaceuticals, Inc. was founded in 1979 and is headquartered in Plymouth Meeting, Pennsylvania.

Current Price: $11.93
Consensus Rating: Buy
Ratings Breakdown: 7 Buy Ratings, 3 Hold Ratings, 0 Sell Ratings.
Consensus Price Target: $12.33 (3.4% Upside)



#3 - Gilead Science (NASDAQ:GILD)

Gilead Sciences logo

Gilead Science (NASDAQ:GILD) is also on the forefront of potential coronavirus treatments. The company is developing an experimental antiviral drug, remdesivir that looks to be a promising treatment. Remdesivir is now in late-stage studies and the company says it could report initial results as early as April.

However, Gilead faces a similar risk/reward dynamic as vaccine candidates. If remdesivir performs well, the stock will also perform well. If, however, the trials do not produce the hoped for results, GILD stock could plummet.

Fortunately, that’s not the only reason to like GILD stock. The company’s pipeline includes two of the premier HIV drugs: Biktarvy and Descovy. Gilead is also part of a duopoply in the treatment of hepatitis C.  

Heading into 2020 Gilead was sitting on $25 billion in cash and investments. This means it will easily be able to continue spending on the research and development it needs to expand its pipeline. And that pipeline includes potentially entering the immunology market with filgotinig, a rheumatoid arthritis drug.

Plus, Gilead pays out an attractive dividend. While they don’t have a long history of increasing the dividend, the company has increased the dividend by over 9% on average the last three years. And with plenty of cash on hand, the dividend looks extremely safe.

About Gilead Sciences
Gilead Sciences, Inc., a research-based biopharmaceutical company, discovers, develops, and commercializes medicines in the areas of unmet medical needs in the United States, Europe, and internationally. The company's products include Biktarvy, Descovy, Odefsey, Genvoya, Stribild, Complera/Eviplera, Atripla, and Truvada for the treatment of human immunodeficiency virus (HIV) infection in adults; and Vosevi, Vemlidy, Epclusa, Harvoni, and Viread products for treating liver diseases. It also provides Yescarta, a chimeric antigen receptor T cell therapy for adult patients with relapsed or refractory large B-cell lymphoma; Zydelig, a kinase inhibitor; Letairis, an oral formulation of an endothelin receptor antagonist for pulmonary arterial hypertension; Ranexa, a tablet to treat chronic angina; and AmBisome, an antifungal agent to treat serious invasive fungal infections. In addition, the company offers its products under the name Cayston, Emtriva, Hepsera, Sovaldi, and Tybost. Further, it develops product candidates for the treatment of HIV/AIDS and liver diseases, hematology/oncology, inflammation/respiratory diseases, and others. The company markets its products through its commercial teams; and in conjunction with third-party distributors and corporate partners. Gilead Sciences, Inc. has collaboration agreements with Bristol-Myers Squibb Company; Janssen Sciences Ireland UC; Japan Tobacco Inc.; Galapagos NV; Scholar Rock Holding Corporation; Tango Therapeutics; National Cancer Institute; Pfizer, Inc.; Sangamo Therapeutics, Inc.; Gadeta B.V.; HiFiBiO Therapeutics; Agenus Inc.; HOOKIPA Pharma Inc.; Goldfinch Bio, Inc.; and insitro Inc. The company was founded in 1987 and is headquartered in Foster City, California.

Current Price: $76.75
Consensus Rating: Hold
Ratings Breakdown: 10 Buy Ratings, 15 Hold Ratings, 3 Sell Ratings.
Consensus Price Target: $79.31 (3.3% Upside)



#4 - Exelixis (NASDAQ:EXEL)

Exelixis logo

Most of the stocks in this presentation have benefited from the coronavirus. Exelixis (NASDAQ:EXEL) has actually been on a roller coaster ride. After riding the market melt-up to a 25% gain, the stock plunged sharply and dropped more than 30% from that high. The stock currently sits about flat for the year.  

But if the company isn’t competing in the coronavirus arena, they are one of the leaders in cancer treatment. While the world’s attention is rightly focused on containing the spread of the coronavirus, cancer is a disease that will be long after a vaccine for this novel virus is found.

The company’s top-selling drug, Cabometyx, is used to treat both kidney cancer and liver cancer. And, it’s becoming likely that the company will be receiving additional approved indications for Cabometyx by the end of the year. More indications mean more prospective patients and more revenue.

And, Exelixis currently has a huge cash position of $1.4 billion. This means the company has plenty of ammunition to develop new drugs or pursue a strategic acquisition.

About Exelixis
Exelixis, Inc., an oncology-focused biotechnology company, focuses on the discovery, development, and commercialization of new medicines to treat cancers in the United States. The company's products include CABOMETYX tablets for the treatment of patients with advanced renal cell carcinoma who received prior anti-angiogenic therapy; and COMETRIQ capsules for the treatment of patients with progressive and metastatic medullary thyroid cancer. Its CABOMETYX and COMETRIQ are derived from cabozantinib, an inhibitor of multiple tyrosine kinases, including MET, AXL, RET, and VEGF receptors. The company also offers COTELLIC, an inhibitor of MEK as a combination regimen to treat advanced melanoma; and MINNEBRO, an oral non-steroidal selective blocker of the mineralocorticoid receptor for the treatment of hypertension in Japan. Exelixis, Inc. has collaboration and license agreement with Ipsen Pharma SAS, Genentech, Inc., GlaxoSmithKline, Bristol-Myers Squibb Company, Merck, Invenra, Inc., StemSynergy Therapeutics, Inc., and Daiichi Sankyo Company, Limited. The company was formerly known as Exelixis Pharmaceuticals, Inc. and changed its name to Exelixis, Inc. in February 2000. Exelixis, Inc. was founded in 1994 and is headquartered in Alameda, California.

Current Price: $22.37
Consensus Rating: Buy
Ratings Breakdown: 9 Buy Ratings, 3 Hold Ratings, 0 Sell Ratings.
Consensus Price Target: $28.92 (29.3% Upside)



#5 - Vertex Pharmaceuticals (NASDAQ:VRTX)

Vertex Pharmaceuticals logo

Vertex Pharmaceuticals (NASDAQ:VRTX) is another biotech company that is not a play on the coronavirus. What sets Vertex apart is its leadership position in the area of cystic fibrosis treatment. The company currently has four drugs that are approved in the United States. Of those four, three of them are also approved in Europe. And the one that has not received approval, Trikafta, is likely to be approved as well and stands to be the biggest seller in the Vertex portfolio.

However, the company is not resting on its laurels. Biotech stocks are not known for issuing dividends because of their commitment to growth. This usually takes the form of acquisition or in developing future drugs. In the case of Vertex, it’s a little of both.

The company spent $950 million to buy Semma Therapeutics last year. This will give the company access to an experimental drug for Type 1 diabetes. The company is also partnering with CRSPR Therapeutics (CRSP) to develop a gene-editing therapy that targets rare blood diseases.

About Vertex Pharmaceuticals
Vertex Pharmaceuticals Incorporated engages in developing and commercializing therapies for treating cystic fibrosis. The company markets SYMDEKO/SYMKEVI, ORKAMBI, and KALYDECO to treat patients with cystic fibrosis who have specific mutations in their cystic fibrosis transmembrane conductance regulator gene. It is also developing VX-659 and VX-445 that are Phase III clinical trials; VX-121, a cystic fibrosis transmembrane conductance regulator corrector that is in Phase I/II clinical trial; VX-150, an inhibitor that is in Phase IIb clinical trial for acute pain; CTX001 that is in Phase I/II clinical trial for the treatment of beta-thalassemia and sickle cell diseases; and a novel drug candidate, which is in Phase I clinical trial for the treatment for alpha-1 antitrypsin deficiency. The company sells its products primarily to specialty pharmacy and specialty distributors in the United States, as well as specialty distributors and retail chains, and hospitals and clinics internationally. Vertex Pharmaceuticals Incorporated has collaborations with CRISPR Therapeutics AG; Arbor Biotechnologies, Inc.; Moderna Therapeutics, Inc.; Genomics plc; Merck KGaA; Darmstadt, Germany; X-Chem, Inc.; Janssen Pharmaceuticals, Inc.; Merck KGaA; and Kymera Therapeutics. The company was founded in 1989 and is headquartered in Boston, Massachusetts.

Current Price: $265.69
Consensus Rating: Buy
Ratings Breakdown: 22 Buy Ratings, 7 Hold Ratings, 0 Sell Ratings.
Consensus Price Target: $278.81 (4.9% Upside)



#6 - Crispr Therapeutics (NASDAQ:CRSP)

Crispr Therapeutics logo

Speaking of Crispr Therapeutics (NASDAQ:CRSP), they make the list on their own merits. To say CRSP stock had a good year in 2019 would be an understatement. The stock more than doubled at one point. And although it has come down from those lofty heights, it’s still sitting at about a 30% gain since the beginning of 2019.

Crispr specializes in the field of regenerative medicine and gene editing. This has been a field of intense interest for over 20 years. The possibilities that exist could potentially lead to cures in various diseases.

One reason for investor optimism is the encouraging results for the company’s immune-evasive cell replacement therapy for diabetes. In fact, investors were so optimistic that they essentially turned a blind eye to CRSP launching a $4.3 million stock offering when the stock reached $64.50.

That’s because Crispr is likely to use their $274.1 million windfalls to fund ongoing clinical studies that they are partnering with Vertex Pharmaceuticals (VRTX) to complete.

About Crispr Therapeutics
CRISPR Therapeutics AG, a gene editing company, focuses on developing transformative gene-based medicines for the treatment of serious human diseases using its regularly interspaced short palindromic repeats associated protein-9 (CRISPR/Cas9) gene-editing platform in Switzerland. Its lead product candidate is CTX001, an ex vivo CRISPR gene-edited therapy for treating patients suffering from dependent beta thalassemia or severe sickle cell disease in which a patient's hematopoietic stem cells are engineered to produce high levels of fetal hemoglobin in red blood cells. The company is also developing CTX110, a donor-derived gene-edited allogeneic CAR-T therapy targeting cluster of differentiation 19 positive malignancies. In addition, it is developing allogeneic CAR-T programs targeting B-Cell maturation antigen and CD70; CTX120, a CAR-T cell product candidate for the treatment of multiple myeloma; CTX130 for the treatment of solid tumors and hematologic malignancies; programs to treat Hurler Syndrome and severe combined immunodeficiency disease, as well as glycogen storage disease Ia; and programs targeting diseases, such as Duchenne muscular dystrophy and cystic fibrosis. It has a collaboration agreements with Vertex Pharmaceuticals, Incorporated and Vertex Pharmaceuticals (Europe) Limited to develop, manufacture, commercialize, sell, and use various therapeutics; and StrideBio LLC to develop adeno-associated viral capsids. The company also has research collaboration agreements with Neon Therapeutics for developing neoantigen-based therapeutic vaccines and T cell therapies; Massachusetts General Hospital Cancer Center to develop T cell therapies for cancer; ViaCyte, Inc. for designing, developing, and commercializing gene-edited allogeneic stem cell therapies for the treatment of diabetes; and ProBioGen AG to develop novel in vivo delivery modalities for CRISPR/Cas9. CRISPR Therapeutics AG is headquartered in Zug, Switzerland.

Current Price: $62.26
Consensus Rating: Buy
Ratings Breakdown: 12 Buy Ratings, 2 Hold Ratings, 1 Sell Ratings.
Consensus Price Target: $74.42 (19.5% Upside)



#7 - Co-Diagnostics (NASDAQ:CODX)

Co-Diagnostics logo

If there’s one thing that the coronavirus crisis is teaching us, it’s the importance of testing. And that’s why Co-Diagnostics (NASDAQ:CODX) is having its moment. At one point, CODX stock was trading at over 300% above its pre-correction level. And it all was based on strong demand for the company’s CE-IVD Logix Smart COVID-19 test kits.

CODX was one of the first companies to have test kits available. They initially shipped the kits to four continents, but could not ship kits inside the United States due to Food and Drug Administration (FDA) regulations. However on February 29, 2020 the FDA relaxed its regulations and the company was free to ship the test kits in the United States.

At that time the company could only produce about 50,000 test kits per day. But they expect to get that number up to 150,000 per day when a production facility in India goes online. “Our facility in that country stands to more than triple our manufacturing capacity for this test, especially important to meet potential demand in the eastern hemisphere,” said CODX CEO Dwight Egan.

The stock has not managed to maintain that lofty share price of over $21 per share. But the stock is still above $9 per share. Which is still impressive considering that CODX was trading below $1 per share when the year started.

About Co-Diagnostics
Co-Diagnostics, Inc., a molecular diagnostics company, intends to manufacture and sell reagents used for diagnostic tests that function via the detection and/or analysis of nucleic acid molecules. It also intends to sell diagnostic equipment from other manufacturers as self-contained lab systems. Co-Diagnostics, Inc. was founded in 2013 and is headquartered in Salt Lake City, Utah.

Current Price: $15.98
Consensus Rating: Buy
Ratings Breakdown: 2 Buy Ratings, 0 Hold Ratings, 0 Sell Ratings.
Consensus Price Target: $17.00 (6.4% Upside)



#8 - Amgen (NASDAQ:AMGN)

Amgen logo

There are few slam dunks in the biotech sector, but Amgen (NASDAQ:AMGN) has been pretty close. The stock is down significantly in 2020, but Amgen is simply one of the largest companies in the biotech arena. It has a large, and historically profitable, portfolio, and pays a dividend.

The question for some investors what will Amgen do to combat declining revenue for its signature drugs. To that end, the company is expecting to receive data from various studies in 2020. This data will include results for its promising drug omecamtiv mecarbil, which is a candidate for the treatment of heart failure. According to GlobalData, this could be a $16.1 billion market by 2026.

Another strategy that is working for Amgen is its effort to form collaborations. In the last 10 years, Amgen has expanded its footprint to 100 countries including China and some emerging markets. Its most recent collaboration is with BeiGene (BGNE). The acquisition is a strategic investment in China. BeiGene has strong experience in oncology with both commercial and clinical capabilities.

About Amgen
Amgen Inc. discovers, develops, manufactures, and delivers human therapeutics worldwide. It offers products for the treatment of oncology/hematology, cardiovascular, inflammation, bone health, and neuroscience. The company's products include Enbrel to treat plaque psoriasis, rheumatoid arthritis, and psoriatic arthritis; Neulasta, a pegylated protein to treat cancer patients; Prolia to treat postmenopausal women with osteoporosis; Aranesp to treat anemia; Xgeva for skeletal-related events prevention; Sensipar/Mimpara products to treat sHPT in chronic kidney disease; and EPOGEN to treat a lower-than-normal number of red blood cells. It also markets other products in various markets, including Kyprolis, Nplate, Vectibix, Repatha, NEUPOGEN, Parsabiv, Blincyto, Aimovig, Imlygic, Corlanor, Kanjintitm, and Amgevitatm. Amgen Inc. serves healthcare providers, including physicians or their clinics, dialysis centers, hospitals, and pharmacies. It distributes its products through pharmaceutical wholesale distributors, as well as direct-to-consumer channels. The company has collaborative agreements with Novartis; UCB; Bayer HealthCare Pharmaceuticals Inc.; and DaVita Inc. Amgen Inc. was founded in 1980 and is headquartered in Thousand Oaks, California.

Current Price: $225.67
Consensus Rating: Buy
Ratings Breakdown: 16 Buy Ratings, 11 Hold Ratings, 1 Sell Ratings.
Consensus Price Target: $245.00 (8.6% Upside)

 

Every market sell-off creates winners and losers. And this one is no different. Markets are enjoying the stimulus plans that are coming from the United States and other nations. But even this stimulus will only go so far if the coronavirus lives up to the worst-case scenarios of medical experts.

And that’s why now is a great time to look at biotech stocks. Whether you’re looking at stocks of companies that are working on vaccines or anti-virals, or whether you’re just looking to snatch up stocks of quality companies that are selling at bargain prices, you have many options in this sector.

The stimulus package coming from the U.S. government will be sending money directly to companies that are involved in the research and development for vaccines and other treatments that can help the world combat the coronavirus.

But investors have to look beyond this current crisis. Some of the companies that are racing for a coronavirus treatment don’t have anything else in their portfolio. And when it comes to biotech companies, the pipeline is very important. That’s how you get the repeatable and sustainable revenue that drives up stock prices and helps reward shareholders.

7 Virus-Resistant Retail Stocks to Own Now

The U.S. economy contracted by 5% in the first quarter. That was slightly larger than the 4.8 decline that was previously forecast. On the same day that GDP was released, we also learned that the ranks of those filing for unemployment claims exceeded 40 million.

But as sobering as those numbers are, they’re not completely surprising. The U.S. economy was effectively shut down as citizens did their part to slow the spread of the novel coronavirus. But the cost of those efforts is just being measured.

And one of those measurements comes in the all-important Consumer Confidence Index. The index ticked up slightly in May to 86.6. While this number is about 30% lower than where the index sat In February, it’s significantly higher than where it sat at the trough of the financial crisis and subsequent recession.

And a big reason for that is that while the brick-and-mortar economy shut down, the digital economy helped give the economy a pulse.

Consumption is a key part of our economy. That’s why consumer confidence makes up 70% of the U.S. economy. And one of the key ways that consumers express that confidence or lack thereof, is in the retail sector.

For the last few years, the story of retail has been about which retailers were going to be able to successfully compete in the e-commerce space that is still owned by Amazon (NASDAQ:AMZN). Sadly, we’re discovering that some companies, like J.C. Penney, were late to adapt in a meaningful way. But that isn’t the case for all retailers.

In this special presentation, we are identifying 7 retail stocks that have done well through this turbulent time and should use that as a springboard to continued growth.

View the "7 Virus-Resistant Retail Stocks to Own Now" Here.






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