Are These The Best Biotech Stocks To Buy Or Avoid This Week?
Biotech stocks have been on a tear in recent months. For investors that are seeking high returns in the stock market today, look no further than the ultimate risk/reward play of the biotech industry. No other sector comes close to the return potential of this sector in the year 2020. Essentially, the biotech industry even made tech stocks look inferior when looking at percentage gains from both industries. Having said that, there are also a lot of risks involved when investing in the biotechnology industry. After all, the sector is inherently volatile by nature.
The coronavirus pandemic has led investors to look for top biotech stocks to buy, mostly focusing on vaccines or treatments. Regardless of what other investors think are the best biotech stocks to buy, everyone is here in the stock market to make money. Gone are the days when minor vaccine news would push biotech stocks to increase by a few folds in one day. As contenders in the vaccine race enter later stages in clinical trials, we might be better off banking on bigger biotech stocks to grow bigger. That way, investors could be insulated from huge losses from smaller-cap vaccine stocks that tend to move both ways on an epic scale.
If you are looking to invest in vaccine stocks in the long run, why not take a closer look at the stocks from the Operation Warp Speed program. This could allow investors to narrow down the choices of biotech stocks and focus on those that could manufacture a large number of vaccines according to the government’s initiatives. With all that being said, are these the best biotech stocks to buy in the long run?
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Best Biotech Stocks To Buy [Or Avoid]: Moderna
Shares of Moderna (MRNA Stock Report) climbed 16% on Friday. This came after the biotech company had a negotiation on an advanced purchase deal for its experimental Covid-19 vaccine with the European Union. It is unsurprising that the EU would want a deal with Moderna so badly. The analysis published in The New England Journal of Medicine showed that the vaccine candidate, MRNA-1273 could provide a defense against the insidious disease in 100% of its phase 1 study participants. But this is yet to be final. More testing is necessary before we can conclude that this is safe and effective for us.
Moderna plans to kick off a phase 3 study of mRNA-1273 on July 27. If all goes well, the company could be on a fast path to winning FDA Emergency Use Authorization and full approval. Jefferies analyst Michael Yee thinks that Moderna’s COVID-19 vaccine could make over $5 billion per year if it wins approval. Even though MRNA stocks have gone up almost 400% this year, it could potentially go a lot higher. That’s if the company’s Covid-19 vaccine candidate achieves its potential. Would this be a good enough reason to draw investors’ attention to MRNA stock? Is this the best biotech stock to buy right now? You be the judge.
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Best Biotech Stocks To Buy [Or Avoid]: AstraZeneca
AstraZeneca (AZN Stock Report) ranks among the biggest drugmakers in the world. When it comes to investing in biotech stocks that are developing the Covid-19 vaccine, AZN stock is one of the most attractive options in the market right now. When you invest in AZN stocks, you are not only investing in the Covid-19 vaccine. AstraZeneca also has a healthy portfolio of drugs targeting cancer, cardiovascular, renal and metabolic diseases; and respiratory conditions. This means that the company can still perform well even if the Covid-19 vaccine candidate doesn’t work out. Of course, if that really happens, the stock would likely give up some of its recent gains. In any case, AZN stock can potentially be one of the best stocks to buy if you are in it for the long run.
The company generated over $24 billion in sales last year. Some investors could find AZN attractive because of its dividend, which currently yields 2.6%. Others might be more attracted to the company’s growth prospects which are quite appealing. And the more speculative traders are obviously most interested in the development of the company’s Covid-19 vaccine. Could AstraZeneca win the vaccine race? That is certainly a possibility. But it may only be the second or third to produce a safe and efficacious vaccine. It’s impossible to say for sure with clinical trials still ongoing. But we can consider the research team’s experience and the speed of which they have made progress. And these are definitely reasons to be optimistic.
