Despite market turbulence, the biotech sector has performed well due to breakthrough developments and inelastic demand for healthcare products and services.
Given this backdrop, investors could check out fundamentally sound stocks Amicus Therapeutics, Inc. (FOLD) and POINT Biopharma Global Inc. (PNT).
The Biden administration’s National Biotechnology and Biomanufacturing Initiative is projected to generate long-term growth in the industry.
Government support for the modernization of regulatory frameworks, improved approval processes and reimbursement policies, and standardization of clinical research, offering new avenues for growth and increasing market income. The global biotechnology market is expected to grow at a CAGR of 13.9% until 2030.
Investors’ interest in biotech stocks is evident from the SPDR Series Trust SPDR S&P Biotech ETF (XBI) 10.6% returns over the past month and 6.4% over the past six months.
Let’s delve deeper into the fundamentals of the stocks.
Amicus Therapeutics, Inc. (FOLD)
FOLD is a biotechnology company focusing on discovering, developing, and delivering medicines for rare diseases. Its commercial product and product candidates include Galafold, an oral precision medicine for treating adults with a confirmed diagnosis of Fabry disease.
On April 26, 2023, FOLD announced that it had received a positive opinion from the European Medicines Agency’s (EMA) Committee for Medicinal Products for Human Use (CHMP) for its investigational drug miglustat, the enzyme stabilizer component of AT-GAA, a combination therapy for the treatment of Pompe disease.
The recommendation of miglustat treatment marketing permission could increase the company’s revenue stream in the future.
FOLD’s trailing-12-month gross profit margin of 88.28% is 58.6% higher than the industry average of 55.66%. Its trailing-12-month asset turnover ratio of 0.40x is 15.7% higher than the industry average of 0.35x.
FOLD’s net product sales increased 7.8% year-over-year for the fiscal year that ended on December 31, 2022, to $329.23 million. The company’s gross profit came in at $290.63 million, representing a 7.2% increase year-over-year.
Also, its total current liabilities came in at $139.08 million for the period that ended December 31, 2022, compared to $145.98 million for the period that ended December 31, 2021.
Analysts expect FOLD’s revenue to increase 19.4% year-over-year to $393.21 million in 2023. FOLD’s shares have gained 94.3% over the past year to close the last trading session at $12.18.
FOLD’s POWR Ratings reflect this promising outlook. The stock has an overall rating of B, equating to a Buy in our proprietary rating system. The POWR Ratings assess stocks by 118 different factors, each with its own weighting.
FOLD has a B grade for Growth. Within the Biotech industry, it is ranked #30 out of 379 stocks. Click here for the additional POWR Ratings for Sentiment, Value, Momentum, Stability, and Quality for FOLD.
POINT Biopharma Global Inc. (PNT)
PNT is a radiopharmaceutical company, develops and commercializes radioligands that fight cancer.
On April 24, 2023, PNT and Lantheus Holdings, Inc. (LNTH), a company dedicated to improving patient outcomes through diagnostics, radiotherapeutics, and artificial intelligence solutions that enable clinicians to Find, Fight, and Follow disease, announced the FDA had granted Fast Track designation for 177Lu-PNT2002 for the treatment of metastatic castration-resistant prostate cancer (mCRPC).
Fast track is a procedure aimed to speed the development and approval of medications to treat critical illnesses and solve unmet medical needs.
PNT’s trailing-12-month EBITDA and gross profit margin of 56.01% and 100% are significantly higher than the industry averages of 1.78% and 55.66%, respectively.
For the fourth quarter that ended December 31, 2023, PNT’s income from operation came in at $191.36 million, compared to a loss of $14.10 million in the previous-year quarter.
Also, its net income came in at $163.27 million, compared to a net loss of $14.20 million in the previous-year quarter. Its income per share came in at $1.53, compared to a loss per share of $0.16 in the previous-year quarter.
Street expects PNT’s revenue to increase 150% year-over-year to $70.09 billion in 2024. Over the past three months, the stock has gained 8% to close the last trading session at $8.15.
It’s no surprise that PNT has an overall B rating, equating to a Buy in our POWR Ratings system. It has a B for Sentiment, Value, and Quality. It is ranked #28 in the same industry.
Beyond what is stated above, we’ve also rated PNT for Growth, Stability, and Momentum. Get all PNT ratings here.
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FOLD shares were trading at $12.07 per share on Tuesday morning, down $0.11 (-0.90%). Year-to-date, FOLD has declined -1.15%, versus a 8.01% rise in the benchmark S&P 500 index during the same period.
About the Author: Rashmi Kumari
Rashmi is passionate about capital markets, wealth management, and financial regulatory issues, which led her to pursue a career as an investment analyst. With a master's degree in commerce, she aspires to make complex financial matters understandable for individual investors and help them make appropriate investment decisions.
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