Biotech and pharmaceutical research are the hottest growing sectors in the global business market, brought into the public eye by the onset of the COVID-19 pandemic.
Buoyed by a huge war chest, which some analysis suggests could exceed $1.7 trillion in 2022, the top companies in the field are poised to make a lot of huge moves - M&A deals, dividend payments to shareholders, and large share buybacks.
That's all great news for shareholders, but there's another, lesser known event that gets my attention - insider buying.
These purchases frequently precede a performance spike in a company's stock, and biotech seems to be unusually consistent in this regard. One analysis by researchers from Cowen found that in the year following insider purchases, biotech stocks outperformed the NASDAQ Biotech Index by an average of 19.5%.
The pick I have for you today is a development company with a large number of treatment candidates in clinical and preclinical trials, and whose recent moves toward commercialization, along with a large wave of insider buying, suggest that it's an ideal time for investors to get in.
Read on for the ticker...
Execs Own a Quarter of This Firm's Shares
Alpine Immune Sciences Inc. (NASDAQ: ALPN) is an R&D company specializing in the development of therapies and treatments for inflammatory and autoimmune disorders, as well as certain types of cancers. Their approach primarily involves advanced protein engineering, aiming to improve the body's immune response to a wide variety of diseases.
This is the same kind of technology that led to the development of the mRNA COVID-19 vaccine, and represents a new type of disease treatment with enormous potential.
Its last earnings report showed it at $8.52 million in revenue for the quarter, a year-over-year increase of 345%. Biotech firms can often languish and burn cash if their products spend too long in trials, but Alpine's recent deal with Horizon Therapeutics Plc. (NASDAQ: HZNP) for exclusive rights to commercialize and distribute its preclinical candidates suggests that it's on the verge of bringing something to market.
This could be why we're seeing such high-volume insider purchasing. Insiders currently own 26.5% of total shares, and the past six months have been a whirlwind, with purchases in excess of $5 million.
The shares are currently trading around $7, down from a high of $13.89 at the start of the year. With a wide variety of director-level executives and board members doubling down on the stock, it's very likely we're going to see it bounce back at least to that level in the near future. This is the best time to get in and take advantage of the potential for quick profits.
One of the reasons that biotech is exploding is because of a recent wave of technological development. What we've seen so far is pretty impressive, but there's something coming down the road that could totally revolutionize biotech- along with pretty much every other industry on Earth.
I'm talking about quantum computing, which allows a computer to reach beyond the "ones and zeroes," "yes or no" of regular binary and think in terms of "maybe." The upshot is that this will allow computers to tackle problems and crunch data in a way that we previously thought was impossible, as much as 158 million times faster than conventional machines.
This sector is projected to bring in $8 trillion in new wealth over 2022 and beyond. Investors who move now can grab a "ground-floor" stake in this game-changing tech - here's how...
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About the Author
Garrett Baldwin is a globally recognized research economist, financial writer, consultant, and political risk analyst with decades of trading experience and degrees in economics, cybersecurity, and business from Johns Hopkins, Purdue, Indiana University, and Northwestern.