By Julie Lamb for TipRanks
There are always new growth opportunities on the rise in the gainful biotech market. The real question is which drug maker is worth the risk. After all, rewards in the healthcare market can prove to be not only substantial, but there’s the added benefit of investing in a biotech company that is transforming patient’s lives.
Here, we turn to the TipRanks’ Stock Screener investor tool to get a clear sense of biotech outlooks. Specifically, we break down current market data on biotechs that have top analysts recommending a consensus ‘Buy’ rating. More importantly, we additionally scoped names that offer enticing upside potential for shares.
Let’s dive right in:
Massachusetts-based Biogen (BIIB) has turned $68.4 billion biotech giant in the last four decades. The company describes its team as “pioneers in neuroscience.”
Stifel’s Paul Matteis assumed bullish coverage on Biogen last month with a Buy rating. How much room do BIIB shares have to fly? Notably, Matteis set a 12-month price target on BIIB stock of $394, marking almost 16% upside potential. (See Paul Matteis’ other stock recommendations)
As far as Matteis sees it, Biogen’s future rests on its Alzheimer’s therapy opportunity- and probability is over 50-50. “From a sentiment perspective, we think the stock — in a positive or negative Alzheimer's scenario — could overshoot its fundamental value,” explained Matteis.
The analyst likewise looks for gains in Spinraza in both Type 2 and Type 3 spinal muscular atrophy patients- especially taking into account prospects for faster-than-anticipated sales abroad. In fact, Matteis bets international sales may be just around the corner from outperforming U.S. sales- and by a lot: hundreds of millions of dollars. Consider this a moat to bolster the drug when rivalry eventually hits.
Matteis continued, “Global diversification may also help with durability when gene therapy disrupts the category,” adding: “When this happens we assume that Spinraza's front-line Type 1 share will quickly approach zero percent, but we believe its ability to retain patients already on therapy who are doing well could be stronger than many expect.”
Biogen is a ‘Moderate Buy’ stock among best-performing analysts, according to TipRanks analytics. The stock has 9 bulls in its corner and 4 playing it safe on the sidelines over the last three months. Consensus expectations shine confidently, reaching a 12-month average price target of $393.92. In other words, Wall Street forecasts another nearly 16% in upside potential ahead. See BIIB Price Target and Analyst Rating Details.
Ireland-based Jazz Pharmaceuticals (JAZZ) is a $10.01 billion specialty biopharma focused on a pipeline to address unmet medical needs. Notably, the company landed on Forbes’ Growth Champions list last year.
FBR analyst David Buck not only is bullish on Jazz- he continues to cheer the stock as his “top pick and Alpha Generator name.” (See David Buck’s other stock recommendations)
As such, the analyst maintains a Buy on Jazz with a $219 price target (32% upside potential).
“We see Jazz shares as particularly attractive after correcting by 3.7% for week ended 8/24/18 versus its benchmark gaining 0.5%,” asserts Buck.
By the end of August, Jazz revealed an EU green light for Vyxeos in varied subtypes of high-risk acute myeloid leukemia. The Vyxeos approval (44 mg and 100mg powder for solution) covers all EU member states as well as a few add-on European countries.
“We expect rolling EU launches following pricing and reimbursement decisions on a country-by-country basis. This approval is slightly ahead of our September 2018 expectation. As reminder JAZZ guidance for Vyxeos moved down post 2Q18 results from $130M-$155M to $115M-$135M,” contends Buck.
Overall, the ‘Strong Buy’ stock has generated positive buzz on Wall Street. All 4 best-performing analysts polled in the last three months rate a Buy on Jazz. Consensus expectations also round out to healthy confidence on the Street. The 12-month average price target stands at $208.75, marking just under 26% upside potential on tap for Jazz stock. See JAZZ Price Target and Analyst Rating Details.
Agios Pharma (AGIO) is a $4.3 billion biotech player- and has just tapped highly respected Celgene veteran (NASDAQ:CELG) Jackie Fouse as its next CEO.
In reaction to the corporate shakeup, Canaccord’s John Newman, a five-star analyst on TipRanks, just reiterated a Buy rating on AGIO stock. The analyst bets AGIO shares can soar to $90 (nearly 24% upside potential).
Worthy of note, Newman has a solid track record when it comes to recommending AGIO. The analyst makes 31.0% in average profits on the stock. (See John Newman’s other stock recommendations)
“We maintain a favorable view on Fouse as the CEO given her expensive experience at Laboratories, holding various senior roles focusing on corporate strategies, finance, and operations. We believe Fouse will help maintain AGIO’s heading in launching the approved products and developing the pipeline,” writes Newman.
Bottom line: this ‘Strong Buy’ stock has received 3 buy ratings in the last three months from best-performing analysts. Only one analyst is hedging bets on AGIO shares. The 12-month average price target of $89.50 reflects close to 21% upside potential ahead. See AGIO Price Target and Analyst Rating Details.
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