It would be fair to say biotech has had an interesting time of it over the course of the past 15 months. Except, of course, that biotech always has an interesting time of it. The go big or go home sector of the market attracts speculators, scientists, and unsavory characters, but also attracts people hoping for critical improvements to their healthcare options.
With a lot of sentiment and sometimes too little information, it can be hard to find an edge. Throw in the political questions stemming from stories like Valeant (NYSE:VRX), Sarepta (NASDAQ:SRPT), and Mylan (NASDAQ:MYL), and the interesting times don’t appear likely to go away.
With an assist from SA Managing Editor (and CFA) Mike Taylor, we asked a few authors who focus on the biotech sector to tell us which way they think the winds might blow.
Bret Jensen, author of The Biotech Forum ONeil Trader, author of Growth Stock Forum Bhavneesh Sharma, author of Vasuda Healthcare Analytics Chris Lau, author of Value Stocks for DIY Investors Alexander J. Poulos, author of Undervalued Gems Wall Street Titan, author of Stem Cell Sector News and Analysis
Seeking Alpha: Investors are aware of headline political risk this year, but there’s also some regulator level confusion. On one hand, we have a recent approval decision on a six-figure drug from Sarepta with controversy over efficacy, to put it mildly. On the other hand, there’s uproar over the EpiPen, which some argue is expensive but at least is acknowledged to work. How are you evaluating the FDA’s and regulators’ posture relative to industry?
Hot Biotech Stocks For 2019: KNOT Offshore Partners LP(KNOP)
- [By ]
If I Could Only Choose One…
Of all the double-digit yielders in my screening universe, Knot Offshore Partners (NYSE: KNOP) has the strongest coverage ratio. The company is currently distributing annual payments of $2.08 per share, and the average earnings estimate for next year is $2.51 per share — for a comfortable coverage ratio of 121% ($2.51/$2.08).
Hot Biotech Stocks For 2019: Evoke Pharma, Inc.(EVOK)
- [By Lisa Levin]
DBV Technologies SA – ADR (NASDAQ: DBVT) shares tumbled 50.6 percent to $23.73 after the company disclosed that its peanut allergy trial failed to meet primary endpoint.
Connecture Inc (NASDAQ: CNXR) shares declined 40.8 percent to $0.290. Connecture reported that it will voluntarily delist from the NASDAQ for OTCQX Market.
Walter Investment Management Corp (NYSE: WAC) slipped 19.2 percent to $0.410. On Friday, Walter Investment Management disclosed that it has reached an agreement with term lenders and senior noteholders on financial restructuring.
Eldorado Gold Corp (USA) (NYSE: EGO) shares dropped 15.9 percent to $1.83. Eldorado Gold lowered its production guidance for its Kisladag operation.
Seanergy Maritime Holdings Corp. (NASDAQ: SHIP) shares fell 15.4 percent to $1.04.
Future Fintech Group Inc (NASDAQ: FTFT) dropped 13.6 percent to $1.53. Future FinTech reported filing of proxy statement, including proposal for corporate restructuring.
Concordia International Corp (NASDAQ: CXRX) shares fell 12.3 percent to $0.500 after dipping 38.71 percent on Friday.
Aemetis Inc (NASDAQ: AMTX) shares declined 11.3 percent to $0.550
OncoSec Medical Inc (NASDAQ: ONCS) dipped 10.5 percent to $1.12. OncoSec reported a $7.1 million registered direct at-the-market offering at a price of $1.34375 per share.
Evoke Pharma Inc (NASDAQ: EVOK) shares fell 10.35 percent to $3.08 after the company disclosed 'positive' topline results from comparative exposure pharmacokinetic study for Gimoti.
Eiger Biopharmaceuticals Inc (NASDAQ: EIGR) shares dropped 9.4 percent to $11.60 as the company disclosed Phase 2 interim 24-week data with pegylated interferon lambda in Hepatitis Delta Virus infection at the American Association for the Study of Liver Diseases Meeting.
Viking Therapeutics Inc (NASDAQ: VKTX) shares slipped 6.6 percent to $2.80. Viking Therapeutics presented results from proof-of-concept study of VK0214 in in vivo
- [By Cameron Saucier]
Evoke (Nasdaq: EVOK) is a pharmaceutical company that develops drug candidates intended to treat gastrointestinal diseases. EVOK rose 73% last month after it announced positive guidance from the FDA for Gimoti, a patented nasal delivery drug that is intended to treat gastroparesis in adult women. The positive results were from a second pre-NDA (New Drug Application) meeting Evoke had with the FDA. EVOK is currently trading at $2.67 per share and is down 9.83% as of Jan. 9 YOY.
Hot Biotech Stocks For 2019: Oxford Industries Inc.(OXM)
- [By Ben Levisohn]
Looking at recent historical deals, we arrive at a $18-$23 potential deal range. We analyzed transactions that have been announced over the past four years and involved companies catering to a higher income customer. These deals include Southern Tide (acquired by Oxford Industries (OXM)), Joe’s Jeans (acquired by Sequential Brands Group (SQBG)), prAna (acquired by Columbia Sportswear (COLM)), The Jones Group (acquired by Sycamore Partners [private] and Juicy Couture (acquired by Authentic Brands Group [private]). The average EV/EBITDA multiple of these transactions are 12.9x (in line with KATE’s 5-year historical average of 12.1x) and implies a potential deal range of $22-$23. When taking the average of recent (F13-16) deals implies an ~10.5x EV/EBITDA multiple. When applying the ~10.5x multiples to KATE’s trailing EBITDA, we arrive at an $18- $19 potential share price.
- [By Lisa Levin]
Oxford Industries Inc (NYSE: OXM) was down, falling around 11 percent to $64.05. Oxford Industries reported a narrower-than-expected loss for its third quarter. The company projects full-year earnings of $3.50 to $3.65 per share, and revenue of $1.02 billion to $1.03 billion.