NTLA - The 3 Most Undervalued Gene Editing Stocks to Buy in July 2024
2024-07-09 07:00:00 ET
InvestorPlace - Stock Market News, Stock Advice & Trading Tips
Artificial intelligence stocks will be the choice of growth-oriented investors for years to come. But if you’re a buy-and-hold investor with above-average patience, this is a time to look for undervalued gene editing stocks.
As the name suggests, gene editing companies offer the promise of altering the base instructions that the human body receives through its DNA. Since many life-threatening illnesses are genetically-based, the long-term implications of gene editing are profound.
Moreover, many of these therapies offer the potential for a perfect solution with possibly just one treatment.
But developing these therapies is time consuming, expensive and full of regulatory hurdles, albeit legitimate. So even though companies are in the clinical trial phase, the payoff may still be years away.
However, in the last 12 months, the first gene editing treatments have received approval by the U.S. Food & Drug Administration. Investors are starting to notice.
The good news is that there’s still time. Here are three undervalued gene editing stocks for investors to buy before this sector really explodes.
CRISPR Therapeutics (CRSP)
CRISPR Therapeutics (NASDAQ: CRSP ) is best-known for its proprietary CRISPR-Cas9 technology . The company partnered with Vertex Pharmaceuticals (NASDAQ: VRTX ) to get its lead candidate, CASGEVY, through the rigorous clinical trial stage.
That milestone was reached in December and again in January with CASGEVY now approved for treatment of sickle cell disease and beta-thalassemia.
However, after climbing nearly 53% since the announcement in December, CRSP stock is down about 19% for the year. The issues are cost and accessibility. Even as a one-and-done treatment, the current price tag is $2.2 million, and it’s not yet clear how many, and to what extent, it will be covered by insurance.
Furthermore, the treatment is only currently available at 25 authorized centers around the world.
Nevertheless, CASGEVY now gives gene editing viability. And CRISPR has a deep pipeline that includes potential treatments for diabetes and cancer . It’s a long game, but one that may be worth playing.
Intellia Therapeutics (NTLA)
In the world of gene editing, semantics matter. While CRISPR and Vertex were the first ones to get FDA approval of a gene editing therapy, Intellia Therapeutics (NASDAQ: NTLA ) was the first company to report clinical data that was supportive of the use of in vivo gene editing using CRISPR-Cas9 technology.
Being first hasn’t translated to an approved gene therapy. That’s one reason that NTLA stock is down about 26% in 2024.
That said, 20 out of 29 analysts give Intellia a “Strong Buy” rating with a consensus price target that’s more than 200% higher than its current price. The reason is the company’s lead candidate, NTLA-201, is used to treat transthyretin amyloidosis . It is a rare genetic disease that affects approximately 1.3 million patients.
However, investors are also eyeing the treatment for its potential to treat other genetic diseases including Alzheimer’s, Parkinson’s and Huntington’s. Intellia is partnering with Regeneron Pharmaceuticals (NASDAQ: REGN ) to bring the drug to market.
Beam Therapeutics (BEAM)
Beam Therapeutics (NASDAQ: BEAM ) is known for its base editing approach to gene editing. The layman’s distinction between base editing and CRISPR-Cas9 technology is that the latter acts like a pair of scissors that splices out the offending gene.
Beam’s approach is better thought of as using a pencil and eraser to “edit” the genetic sequence.
The company does not have an approved candidate yet but has three in late-stage trials. Furthermore, the company is funded through 2027 largely due to a lucrative partnership with Pfizer (NYSE: PFE ).
BEAM stock is down 13% in 2024. Plus, with 99% of the stock owned by institutions, it’s not going to have the volatility that can be common in biotech stocks .
That makes this a good time for patient investors to start a position. The stock has a consensus “Buy” rating with a price target that gives the stock more than 100% upside potential.
On the date of publication, Chris Markoch 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.
Chris Markoch is a freelance financial copywriter who has been covering the market for over five years. He has been writing for InvestorPlace since 2019.
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