TipRanks
2 “strong buy” penny stocks with big lead ahead
Does high risk mean high reward? Not necessarily, say Wall Street professionals. Specifically citing penny stocks, or stocks that are traded for less than $ 5 per share, analysts advise caution, as these names may still be in the early innings, or they may face an uphill battle that is very steep. Attracting investors with their banana price tags, these stocks may face oppressive headwinds or have weak fundamentals. However, analysts argue that there are early-stage companies that reflect promising opportunities, with low stock prices meaning that you get significantly more return on your investments. Furthermore, even what appears to be a lower appreciation of stock prices can result in massive percentage gains. The end result? Not all risks are created equal. To that end, professionals recommend taking some steps before making an investment decision. Using the TipRanks database, we removed two penny stocks that won a consensus rating of “strong buy” from the analyst community. Not to mention that each one offers enormous potential for appreciation. Oncolytics Biotech (ONCY) We will start with Oncolytics, a biotechnology company focused on using immunotherapy combinations as a cancer treatment. The company’s approach uses pelareorep, an immune-oncolytic virus, to deliver therapeutic agents that directly target the tumor and activate the immune system’s natural defenses. Oncolytics is conducting its various research programs in partnership with several of the big names in biotechnology, including Pfizer, Merck, Roche and Bristol-Myers Squibb. The company’s development pipeline is testing the compatibility of pelareorep in conjunction with the anti-cancer drugs of larger companies. To date, pelareorep has shown positive results by making early-stage breast cancer tumors more susceptible to checkpoint inhibitor therapy. The data showed that pelareorep induced a robust antitumor immune response in some types of breast cancer. There are three ongoing clinical programs related to breast cancer: The company’s AWARE-1 Phase 2 study, combining pelareorep with Roche’s Tecentriq anti-PD-L1 mAb, is evaluating the impact of the combination on the cancer response rate breast cancer and overall survival. Meanwhile, the BRACELET-1 Phase 2 study will assess the effectiveness of pelareorep in combination with Pfizer’s anti-PD-L1 mAb Bavencio in breast cancer. A third Phase 2 breast cancer study, IRENE, will assess pelareorep’s ability to improve triple-negative breast cancer outcomes. The study is evaluating the safety and efficacy of pelareorep in combination with retifanlimab. ONCY’s strong pipeline and $ 3.01 share price earned him substantial praise from Wall Street professionals. HC Wainwright analyst Patrick Trucchio delved deeply into Oncolytics and concluded that the company offers a good investment opportunity. “The lead compound of oncolytics, pelareorep (pela) … is about to demonstrate the potential to bring down the treatment paradigms for various types of cancer, in our opinion … We believe that it is the studies that are being carried out in cancer of breast (BrCa) that can generate substantial shareholder value in 2021 and beyond, ”said Trucchio. The analyst added: “Since the approval of the first OV T-VEC in 2015, there have been at least eight licensing or acquisition announcements, including Merck’s $ 394m acquisition by Merck in February 2018 and ViraTherapeutics’ € 210m acquisition by Boehringer Ingelheim in September 2018. Oncolytics has collaboration, supply agreements and combination agreements with many of the leading biopharmaceutical companies and organizations involved in cancer research … Positive data readings in any or all of the multitude of combination tests in progress with and ICI could catalyze a much higher valuation than recent mergers and acquisitions, in our opinion. “To this end, Trucchio values ONCY a Buy, and its $ 15 target price implies a robust valuation potential of a year of ~ 397%. (To see Trucchio’s history, click here) Moving on to the rest of the Street, other analysts are on the same page. With 5 purchases and no waiting or selling, the word on the street is that ONCY is a strong buy. Given its average price target of $ 8.51, an increase of ~ 182% may be reserved for investors. (See ONCY’s inventory analysis at TipRanks) Xeris Pharmaceuticals (XERS) Continuing with the biotechnology industry, let’s take a look at Xeris Pharmaceuticals. This company has an important advantage over many of its counterparts: it has an approved drug for use on the market. Gvoke, its self-administered glucagon injection device, was approved by the FDA in September 2019 for use by adults and children suffering from hypoglycemia (hypoglycemia) due to diabetes. The product has generated revenue for Xeris in the last 5 quarters and in 2H20 these revenues started to increase. In the company’s most recent quarterly report for 4Q20, Xeris showed an 11% sequential increase in Gvoke prescriptions and $ 7.1 million quarterly sales; sales of the auto-injection device for the full year totaled $ 20.2 million. In December 2020, the company also received a positive opinion from the European Medicines Agency on Oglou, the environmentally stable liquid glucagon used in Gvoke, as well as the European Commission’s authorization for marketing from February 2021. Xeris targets 4Q21 for the launch of Oglou in the European Union. The company is not resting on its Gvoke laurels. It has an active development channel, with several additional self-administered glucagon devices, as well as candidates for additional drugs under development for the treatment of diabetes and epilepsy. Analyst Difei Yang, writing from Mizuho, sees Gvoke as the key to Xeris’ way forward. “Gvoke continued to gain market share in the quarter (we estimate the recent weekly share to be ~ 16%) for legacy glucagon kits, but we note that the overall growth rate of the glucagon market has stagnated as a result of Covid-19. We anticipate a re-acceleration of the glucagon market in 2H21 with the reduction of Covid-19 and we expect Gvoke’s fundamentals to improve when the market’s growth rate increases, ”wrote Yang. Along with these comments, the analyst placed a buy rating for XERS shares and a target price of $ 14 which indicates room for 225% growth next year. (To see Yang’s history, click here) This is another action that Wall Street likes, as shown by the unanimous strong buying consensus rating derived from 3 recent positive reviews. Xeris shares are selling for $ 4.30 now, and their average price of $ 10.67 implies an upside of ~ 148% in 2021. (See XERS stock analysis at TipRanks) To find good ideas for stock trading with pennies at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that brings together all the capital insights from TipRanks. Disclaimer: The opinions expressed in this article are exclusively those of the analysts presented. The content should be used for informational purposes only. It is very important to do your own analysis before making any investment.