The big question in the minds of investors right now is where will inflation go? And the related follow-up question, of all, how far will the Fed increase rates in response? Possible answers cover the full range of possibilities, from President Biden’s happy talk about ‘zero percent inflation’, to market bears predicting a full-blown economic depression.
Count David Kelly, chief asset management strategist at JP Morgan, among the bulls. He is not convinced of doom, and sees the recent drop in inflation as a sign that the worst is behind us. While the current conditions are still tough, Kelly believes the stock market can and will show additional strength going forward. In his words, “I will invest solely in equities at this point as I think equities can move higher here.”
So let’s follow JPM a little further down this path. Stock analysts at the banking giant have picked two stocks they believe are poised to move up – by orders of 40% or more. In fact, it’s not only JPM experts who are praising these stocks. according to TipRanks Platform – He is rated as a strong buy by Street analysts. let’s take a closer look.
The first JPM pick is Beijin, a clinical-stage biopharmaceutical company that has, in its words, ‘an extensive and deep pipeline’ that takes a shotgun approach to the field of oncology. The company is developing a tremendous number of more than 50 drug candidates, both in-house and as a collaborative effort, to meet the treatment needs in approximately 80% of cancer malignancies. A pipeline that shapes what gives the company a competitive advantage over peers.
BeiGene is a truly international biotech firm, operating in Asia, Europe and the Americas, and boasting administrative offices in Beijing, China, Cambridge, Massachusetts, and Basel, Switzerland. From these offices, the company oversees its development activities, and commercialization activities for its line of approved commercial-stage products.
The major approved products are zanbrutinib, branded as Brukinsa, pamiparib, branded as Partruvix, and tiselizumab, branded under its own name. As a group, these drugs have been approved in several international jurisdictions for the treatment of various hematological cancers and solid tumors. BeiGene has been actively commercializing them for several years, and in 2Q22 the company realized $304.5 million in total sales revenue. This number included $128.7 million in sales from Brukinsa and $104.9 million in sales of tiselizumab in China. The company’s total revenue, which includes support fees, reached $341.6 million, compared to $150 million in the year-ago quarter.
Covering the stock for JPMorgan, analyst Zilling Chen believes BGNE presents a compelling risk reward. Kumar rates the stock as overweight (ie buy) with a $296 price target, meaning a 50% one-year bounce.
Supporting his bullish stance, Chen writes: “We view BeiGene shares as undermining asset/growth quality and highlight the stock as one of our top picks in the region … BeiGene has grown into a fully integrated biopharma company, with best-in-class clinical development capabilities, one of the largest and best oncology commercial platforms in China, and unmatched with global biopharma companies. Partnership prowess. We expect the Company’s 16 commercial assets and extensive pipeline to drive very attractive, diversified long-term growth. While we remain marginally below consensus on long-term sales, we see additional pipeline traction ahead of our projections. Huh … “
In total, 6 Wall Street analysts have paid attention to this biotech giant, and have left 5 buy recommendations against 1 hold for a strong buy consensus rating. The shares are priced at $192.77 and their $253.76 average price target indicates a ~29% increase in the coming months. ,View BGNE Stock Forecast on TipRanks,
Xenon Pharmaceuticals ,XENE,
The other stock we’re looking at is Xenon, another biopharma firm in the clinical stage. Xenon is working on new therapeutic agents in the field of neurology, seeking new drugs to treat neurological conditions with high unmet medical needs. The company pays special attention to the treatment of epilepsy.
Xenon has two major drug candidates in this area, XEN496 and XEN1101, in phase 3 and phase 2 testing, respectively. XEN496 is a Kv7 potassium channel opener, and is being investigated for a rare pediatric form of epileptic seizures. The company expects to complete the Phase 3 EPIK study of XEN496 during 2023.
However, the XEN1101 is the company’s lead drug candidate. It is currently undergoing several Phase 2 trials for focal onset seizure epilepsy (FOS), primary generalized tonic-clonic seizures (PGTCS), and major depression. Phase 2b X-TOLE trials, against FOS, are expected to be completed this year, and the company has two similar Phase 3 trials, X-TOLE2 and X-TOLE3, which are set to run upon completion of the current trial. Phase 3 trials will run in parallel and enroll up to 360 patients.
Xenon is also planning an X-ACKT Phase 3 trial to continue its study of XEN1101’s efficacy against PGTCS. This study will run concurrently with the X-TOLE tests.
Finally, Xenon has a Phase 2 X-Nova study underway to evaluate XEN1101 against major depressive disorder. Topline results from this X-NOVA study, which enrolled 150 patients, are expected in 2023.
jpm analyzer Tessa Romero sees XEN1101 as the major factor in this stock, and makes a clear case as to why: “Strong by primarily compelling Phase 2b X-TOLE data as well as positive physician response, we recommend XEN1101 as an adjunctive treatment regimen.” In its key indication of Focal Onset Seizure (FOS), we also see the potential for XEN1101 to work in patients with both focal and/or generalized seizures and combined Epilepsy indications estimate ~$1B in peak sales in the US alone (~$700M of which is FOS) where our estimates may prove to be conservative.”
“We believe there is an opportunity in XEN shares at current levels that undermines the ability of XEN1101 to expand beyond FOS to additional higher unfulfilled need signals,” the analyst said.
Romero shares XENE as an overweight (ie buy), and his $55 price target points to a 46% uptrend by the end of next year. (To see Romero’s track record, see click here,
Wall Street is clearly bullish on this biopharma, as all 8 recent analyst reviews are positive — leading to a unanimously strong buy consensus rating. The stock is selling for $37.57 and its $51 average price target suggests ~36% one-year upside potential. ,View Xenon Stock Forecast on TipRanks,
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Disclaimer: The opinions expressed in this article are those of featured analysts only. The content is to be used for informational purposes only. It is very important to analyze yourself before making any investment.