LGND - 3 Must-Buy Biotech Stocks Before the Summer Rally Kicks Off

2024-05-20 06:00:00 ET

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Amid the rise of the digital innovation space, investors may want to consider biotech stocks to buy. Fundamentally, a rotation into the sector may occur, boding well for the ecosystem before the summer rally kicks off.

It really comes down to investors enjoying gargantuan returns in the technology industry. Yes, artificial intelligence is all the rage but there’s also the concern that the sector has moved too quickly. At the same time, risk-on sentiment appears robust, as evidenced by the continued support for cryptocurrencies.

Enticingly, few arenas outside of advanced health innovations can offer blistering return potential. Therefore, speculators ought to consider the below biotech stocks to buy.

Ligand Pharmaceuticals (LGND)

Based in Jupiter, Florida, Ligand Pharmaceuticals (NASDAQ: LGND ) engages in the development and licensing of biopharmaceutical assets worldwide. Per its public profile , Ligand’s commercial programs include Kyprolis and Evomela, both of which are used to treat multiple myeloma. Also, the company features Rylaze, a treatment for acute lymphoblastic leukemia or lymphoblastic lymphoma in adult and pediatric patients.

To be sure, Ligand offers myriad other product candidates that address a range of diseases and conditions, from diabetes to osteoporosis. Thanks to its pertinence, Wall Street analysts rate shares a unanimous strong buy . Further, the average price target stands at $121, with a high-side target of $144.

One factor that makes LGND stock stand out is its underlying financial performances. Over the past four quarters since the first quarter of 2024, the company’s average positive earnings surprise clocked in at 88%. For fiscal 2024, analysts anticipate earnings per share of $4.64 on sales of $137.79 million. Last year, EPS reached $6.09 on revenue of $131.31 million.

While Ligand’s trailing-year sales multiple is a bit high at 12.85X , its strong performance makes it one of the biotech stocks to buy.

Solid Biosciences (SLDB)

Headquartered in Charlestown, Massachusetts, Solid Biosciences (NASDAQ: SLDB ) is a life sciences specialist developing therapies for neuromuscular and cardiac diseases. Per its corporate profile , Solid’s lead product candidate is SGT-003, which is a gene transfer candidate for the treatment of Duchenne muscular dystrophy. It’s also developing a therapeutic called AVB-401 for the treatment of a certain type of cardiomyopathy.

Again, thanks to its wide relevance, analysts rate shares a consensus strong buy . This assessment breaks down as five buys and one hold. Further, the average price target comes in at $20.83. Notably, the most optimistic forecast calls for a per-share price of $40.

Last year, Solid posted a quarterly average surprise of 13.98%. Its only miss in 2023 occurred in Q4, when it incurred a loss per share of $1 whereas experts predicted a loss of 99 cents. For 2024, they’re looking for a loss of $2.66, which is a big improvement over last year’s loss of $4.83.

Also, while Solid is a pre-revenue enterprise, analysts are projecting a consensus sales target of $4.14 million this year. Therefore, SLDB is one of the biotech stocks to buy on the compelling pivot.

Atossa Therapeutics (ATOS)

Hailing from Seattle, Washington, Atossa Therapeutics (NASDAQ: ATOS ) is one of the smaller biotech stocks to buy. According to its corporate profile , Atossa only has 12 full-time employees. Still, the clinical-stage enterprise appears to show much promise. It’s developing medicines in the areas of unmet medical need in oncology for women; specifically breast cancer and other conditions. Its lead candidate is oral ( Z )-endoxifen, which is in Phase 2 trials to treat and prevent breast cancer.

Being a small-capitalization play, not too many analysts cover ATOS stock. Nevertheless, the few that do rate shares a unanimous strong buy . Moreover, the average price target stands at $5.33, representing a gargantuan return. Plus, the high-side forecast calls for a price per share of $6. Even the “downside” target of $4 is still a massive leap higher from the current market rate.

To be fair, Atossa is a pre-revenue enterprise. Further, experts aren’t projecting anything in the top line in either 2024 or 2025. Still, if the company succeeds in its clinical trials, ATOS could skyrocket. It’s one to keep on your watch list, especially if you’re a speculator.

On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines .

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