While biotech stocks saw a dip earlier this year due to market uncertainties, the sector is once again regaining popularity as investors seek out growth opportunities. With renewed optimism in the market, there is no better time to explore the potential of investing in biotech.
Despite being a relatively new industry, biotech has rapidly evolved into one of the most innovative and important sectors in healthcare. Stocks from the group have been known to produce 5x, 10x, or even 20x gains in a very short period. No doubt about it: it’s an exciting time to invest in biotech, and today we’re featuring three standouts offering a compelling narrative for investors. Although the sector can be volatile, we believe that careful analysis of the biotech industry can help investors find promising opportunities. So, let’s take a closer look at some of the most exciting and promising biotech stocks to buy now.
CRISPR Therapeutics (CRSP)
CRISPR Therapeutics is a leading gene editing company on the brink of commercializing the first-ever CRISPR gene therapy this year. The treatment will act as a functional cure for sickle cell disease and beta-thalassemia, with a high probability of success. As such, the risk/reward scenario for the stock is attractive, considering the potential for a transformational year ahead.
On April 3, the company announced that it had completed the rolling biologics license applications (BLAs) to the Food and Drug Administration (FDA). The BLAs seek to gain approval for the investigational treatment exagamglogene autotemcel in order to treat sickle cell disease and transfusion-dependent beta-thalassemia.
CRSP is up 54% year to date and has an average price target of $72 among the 31 analysts with coverage of the stock. That implies an upside of about 20%.
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Kymera Therapeutics (KYMR)
Generally speaking, biotech stocks offer investors an excellent opportunity for significant upside success. Grand View Research reports that the global market size for the industry was $1.02 trillion in 2021, and it is expected to grow at a compound annual growth rate (CAGR) of 13.9% from 2022 to 2030, reaching $3.88 trillion by the end of the forecasted period.
Kymera Therapeutics is a promising example of a biotech stock worth considering, with the market showing faith in its potential. KYMR’s share price has gained over 25% since the start of the year.
Zooming out, KYMR has lost 17% of its value over the past 12 months, but it has been forming a series of higher lows since June of last year. Moreover, the company enjoys a strong balance sheet, with a cash-to-debt ratio of 23.49 times and an equity-to-asset ratio of 0.81 times, both of which outperform the majority of its peers.
Analysts have a consensus moderate buy rating on KYMR, with an average price target of $46, suggesting an upside potential of 58%.
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Axsome Therapeutics (AXSM)
Axsome Therapeutics has two approved drugs on the market. Sunosi, a dopamine-norepinephrine reuptake inhibitor and the only one of its kind to treat narcolepsy, and Auvelity, a fast-acting oral treatment for depression, also the first of its kind. The latter launched in October and is being evaluated to treat agitation in people with Alzheimer’s disease and to help people quit smoking. For the treatment of central nervous system disorders and two others, it plans to submit for FDA approval this year.
Other potential tailwinds include Axsome’s two other drugs — AXS-07 for treating migraines and AXS-14 for fibromyalgia — that it plans to submit for FDA approval this year. The share price is down 3% so far this year. The 14 analysts offering 12-month price forecasts for Axsome Therapeutics Inc have a median target of 101.00, representing a 43% increase from the current price.
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