Tuesday's IBD 50 Stocks To Watch pick, biotech leader Intra-Cellular Therapy, is rebounding from support at a key chart level as it approaches a new buy point. That makes Intra-Cellular Therapies one of the best stocks to buy and watch right now.
Intra-Cellular specializes in small molecule drug treatments for neurological diseases, such as Alzheimer's, by targeting intracellular signals in the central nervous system.
Its chief drug, Caplyta, is approved for treating schizophrenia and conditions associated with bipolar disorder in adults. The drug is used as a primary treatment or in combination with lithium or FDA-approved drugs to treat mixed-feature disorders.
On Nov. 2, the company said revenue climbed 76% to $126.2 million during its fiscal third quarter. Analysts had expected revenue of $119.2 million. On an adjusted basis, Intra-Cellular lost 25 cents a share, narrowing from a per-share loss of 57 cents in the year-ago period.
The company's December-quarter results are due Feb. 22, so there's not a whole lot of time to build up a profit cushion. That increases the risk of buying the stock right now.
Biotech Eyes Buy Point
Because the company is unprofitable, and will remain so for the foreseeable future, Intra-Cellular stock has a weak Earnings Per Share Rating of 56 out of a best-possible 99, according to Investor's Business Daily's Stock Checkup. This rating takes into account earnings growth and profit stability over the past three years. The two most recent quarters are weighted more heavily.
Intra-Cellular stock shows a solid 90 out of 99 IBD Composite Rating, according to IBD Stock Checkup, due to strong stock price gains since late October. That places it among the best stocks to buy and watch.
Further, Intra-Cellular Therapies stock is rebounding from its 10-week moving average amid solid gains in recent weeks. Shares are forming a cup base with a 74.17 official buy point, according to IBD MarketSmith chart analysis. Shares slipped nearly 3% midday Wednesday, falling further away from the potential entry.
In December, the stock's relative strength line hit its highest level since May, but it has eased in recent weeks. Look for it hit a new high on the breakout day or shortly thereafter to confirm that Intra-Cellular Therapies is a stock market leader. Remember, the RS line measures a stock's price performance vs. the S&P 500 and is the blue line plotted on IBD Charts.
Best Stocks To Buy And Watch
Three recent IBD 50 Growth Stocks To Watch picks are among the best stocks to buy and watch.
| Company | Symbol | Buy point | Type of base |
|---|---|---|---|
| Royal Caribbean | 112.95 | Cup base | |
| Snowflake | 202.83 | Flat base | |
| Microsoft | 384.30 | Flat base |
Source: IBD Data As Of Feb. 13, 2024
Follow Scott Lehtonen on Twitter at @IBD_SLehtonen for more on the best stocks to buy and watch and the stock market.
