Leerink Is Back On Board The Biotech Train

Leerink has restarted coverage on eight large-cap biotech stocks following a prolonged period of share price underperformance. In a new report, analyst Geoffrey Porges explained why now is the time to buy back into biotech, but investors still must be selective.

Porges pointed out that the selloff has sent many top stocks plummeting to or near all-time lows in terms of revenue and earnings multiples.

“This sell off has occurred in an environment of relatively solid operating performance and strong industry fundamentals; we remain very positive about the industry’s research productivity, returns on capital, commercial efficiency and regulatory prospects,” Porges explained.

Related Link: Is Big Pharma Hinting At A SMID-Cap Biotech Rally?

Many of the large-cap biotech names are currently in transition periods for their business, in which they are making heavy investments in external acquisitions and portfolio diversification. Leerink prefers innovative names that are at the beginning of a growth cycle with focused portfolios and transparent balance sheets.

Leerink names the following Outperform-rated stocks as its top picks:

• Alexion Pharmaceuticals, Inc. (NASDAQ: ALXN)
• Regeneron Pharmaceuticals Inc (NASDAQ: REGN)
• Vertex Pharmaceuticals Incorporated (NASDAQ: VRTX)
• Gilead Sciences, Inc. (NASDAQ: GILD)

In addition, the firm set Market Perform ratings for the following:

• Celgene Corporation (NASDAQ: CELG)
• Biogen Inc (NASDAQ: BIIB)
• Medivation Inc (NASDAQ: MDVN)
• Amgen, Inc. (NASDAQ: AMGN)

Disclosure: The author holds no position in the stocks mentioned.

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