Home Business Biotech Stock With 497% Growth, Positive Trial Results Nears Buy Zone

Biotech Stock With 497% Growth, Positive Trial Results Nears Buy Zone

darudemagJun 24, 2017Business, Money, UncategorizedComments Off on Biotech Stock With 497% Growth, Positive Trial Results Nears Buy Zone

With biotech stocks like Celgene (CELG), Regeneron (REGN) and Biogen (BIIB) spinoff Bioverativ (BIVV) on the move, cancer drug developer Exelixis (EXEL) may be on track for a new breakout.

After several days of big gains for the biotech sector, Regeneron and Bluebird Bio (BLUE) pulled back Friday, but Celgene and Bioverativ continued to climb.

Positive Phase 2 Trial Results

Boosted by FDA approval for its cabozantinib kidney cancer drug in April 2016, Exelexis has seen average revenue growth of 497% over the last four quarters.

Cabozantinib generated $68.9 million in Q1, a 657% year-over-year increase. Total first-quarter revenue was $80.9 million, up from $15.4 million in Q1 2016.

Earnings growth has ranged from 105% to 167% over the last three reports, but note that those gains are based on comparisons to year-over-year quarters with losses.

Exelixis’ share price has soared in recent days following more positive results from the so-called CABOSUN trial, comparing cabozantinib to sunitinib, used in PFE Sutent from Pfizer (PFE).

A blinded independent radiology review committee (IRC) found cabozantinib “demonstrated a clinically meaningful and statistically significant reduction in the rate of disease progression or death.”

In addition to cabozantinib, Exelexis co-promotes Cotellic (cobimetinib) in combination vemurafenib from Roche (RHHBY)-owned Genentech to treat metastic melanoma.

Demand for the stock is reflected in the B+ Accumulation/Distribution Rating, 1.4 up/down volume ratio and four quarters of rising fund ownership.

Exelixis holds the No. 9 rank among its biotech industry peers. Celgene holds the top spot.

Biotech Breakout Ahead?

Riding the biotech boom, Exelixis soared this week, with its relative strength line trending sharply higher. Volume has been well above average.

Exelixis made a huge run from a breakout last June, but the stock reset its base count in May when it undercut the low in the prior consolidation. That means its current cup-shaped pattern is considered a first-stage base.

The potential buy point is 24.95.

On Friday, Exelixis tried, but failed to join Celgene and Bioverativ in positive territory. The stock was down over 1% for the day, but still up around 24% for the week, closing near the top of the price range.

Look for biotechs to keep climbing and for Exelixis to jump past the entry in heavy volume. (Courtesy of Investor’s Business Daily)