Biotech stock Regeneron Pharmaceuticals (REGN) is a case where investors tend to fall in love when the overall stock market crashes with tech stocks. IBD 50 stocks remain near the top of a buying zone after emerging from the new base in March and therefore remain among the rising stocks.
A positive sign is that the relative strength line of Regeneration is entering new high ground as market indicators are in trouble. A feature of strength-enhancing stocks amid market weakness.
Strong rating for watching growth stocks
There are other reasons why Taritown, the NY-based manufacturer of drugs for the treatment of eye diseases, inflammatory diseases and cancer. The stock carries a perfect 99 earnings per share rating. It measures the earning power of a company as opposed to everyone else in the market. Regeneron’s earnings have jumped 260%, 84% and 149% over the last three quarters to an equally impressive sales growth of 163%, 51% and 104%.
Regeneron’s relative strength rating and composite rating are also in the early 90’s, which is what you want to see in growth stocks.
According to IBD Stock Checkup, the stock is ranked No. 2 in the Biotech Group. The group ranks 111th out of IBD’s 197 industry groups in terms of stock price performance. The Biotech Industry Group’s ranking is below 40 or above what you would normally see in growth stocks, but the biotech sector is moving forward. Three weeks ago it was at 142 and six weeks ago it was at 168. The healthcare sector in general has been performing well lately.
The group has several other high-rated stocks that show strength. This helps offset the lower ranking of the group. The group includes other market-leading stocks Passira Biosciences (PCRX), Vertex Pharmaceuticals (VRTX) and Amphaster Pharmaceuticals (AMPH).
Growth faced tougher years than before
Regeneron’s growth rate is difficult to maintain for a long time. Wall Street analysts expect EPS to fall 1% in the first quarter of this year and 40% for the full year. Results next 4 May.
But to see this growth stock continues to work on new treatments.
The company on Monday Sanofi (SNY) has announced that the US Food and Drug Administration has accepted a supplementary biology license application for Dupixant for priority review of patients 12 years of age or older.
If adopted, it would be the first drug available in the United States to treat eosinophilic esophagitis. This chronic and progressive inflammatory disease damages the esophagus and is able to swallow. About 160,000 patients in the United States are being treated for the disease. Of those, about 48,000 have failed multiple existing treatments, the agency said.
The target of the FDA decision for this investigative use is August 3.
Regeneron stock rose above the flat-base buy point of March 16, 673.96, according to the Marketsmith chart analysis. It is now at the top of its buy zone, which goes up to 707.66.
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