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Strong Buy
IBD- Juno, Celgene Lead 5 Top Biotechs Nearing Buy Point05:43 PM ET Biotechs have not only shown resilience during bouts of volatility the past few months but they also remain a top group with many leading stocks setting up in bases. On Tuesday, biotech startupJuno Therapeutics (NASDAQ:JUNO) soared 15% in heavy trading following its late Monday announcement of a $1 billion deal with Celgene (NASDAQ:CELG). Celgene will pay $150 million upfront and buy 9.1 million Juno shares for 93 each, or $850 million, for the option to license Juno's chimeric antigen receptor (CAR) T cell cancer therapies. The 10-year deal also includes the option to buy up to 30% of Juno stock. Juno, which went public Dec. 19 at 24 a share, is off its highs but still up more than 120% from its offering price. The Seattle-based company, whose CAR-T therapies are still early stage, has yet to make money. Celgene, on the other hand, is a steady earnings producer. It has a five-year earnings growth rate of 27% and a 3 Earnings Stability Factor on a scale from 0 (most stable) to 99 (least stable). The biotech is one of five in the group with a best-possible 99 Composite Rating. The stock is shaping a handle on a cup base, with a potential buy point at 121.57. An up-down volume ratio above the neutral 1.0 level and a positive Accumulation/Distribution Rating indicate demand for shares. Celgene develops therapies to treat cancer and immune-inflammatory related diseases. Its best-seller Revlimid, which accounted for 65% of revenue last year, treats multiple myeloma. Gilead Sciences (NASDAQ:GILD), which also earns a 99 Composite, has pulled back to just below a 116.93 buy point cleared June 10. Its 98 Earnings Per Share Rating is among the highest in the biotech group. Gilead's drugs treat HIV, hepatitis and other diseases. Hepatitis C drugs Harvoni and Sovaldi account for more than half of its sales. The drugs have come under fire for their high price tag: Harvoni costs about $95,000 for a 12-week treatment and Sovaldi $84,000. Gilead shares took a hit in December after rival AbbVie 's (NYSE:ABBV) hep C drug won FDA approval. Since then, Gilead has acquired Danish drugmaker EpiTherapeutics. Enanta Pharmaceuticals (NASDAQ:ENTA), a maker of hepatitis C drugs and antibiotics, is building a cup with handle with a 47.38 buy point. In fact, the biotech developed ABT-450, one of three antiviral agents found in AbbVie's hep C drug cocktail. Analysts forecast the agent could generate $2 billion annually by 2017. Enanta, which has a 96 Composite, went public in March 2013 and has been profitable since 2010. Intrexon (NYSE:XON) has dipped below a 47.90 cup-with-handle buy point. The synthetic biology firm, which held its IPO in August 2013, designs, builds and regulates genes and cellular systems. It has yet to turn an annual profit, but its three-year sales growth rate is 121%. Other top-rated biotechs shaping bases include Biogen (NASDAQ:BIIB) (97 Composite) and United Therapeutics (NASDAQ:UTHR) (98 Composite). The biotech group ranked third in Wednesday's issue, vs. No. 6 three weeks ago. Read More At Investor's Business Daily: http://news.investors.com/investing-ibd-industry-themes/070115-759886-juno-celgene-lead-biotechs-near-buy-point.htm#ixzz3egs9WmN0 Follow us: @IBDinvestors on Twitter | InvestorsBusinessDaily on Facebook |
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