Mizuho: these two biotech stocks are worth buying right now
- Selim Syed sees a more than 20% upside in Gilead Sciences stock.
- The Mizuho analyst explains why Cytokinetics is a buy right now.
- The SPDR S&P Biotech ETF is now down about 45% year-to-date.
Biotech is one of the hardest hit sectors this year, with the SPDR S&P Biotech ETF now down 45% year-to-date. Still, a Mizuho analyst says the following two stocks are worth buying.
Syed sees significant upside in Gilead Sciences
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Gilead trades close to our DCF values. It’s currently the best in class on a free cash flow yield basis. So, we like it primarily on valuation, but it’s hard to pinpoint what catalyst will get this stock going.
Syed has a price target of $75 a share on Gilead Sciences that represents a more than 20% upside from here. A week ago, GILD reported market-beating results for its fiscal Q1.
Syed’s favourite small-cap biotech stock
Cytokinetics has a drug for a cardiovascular disease. It trades at about $3.50 billion. The clinical data so far seems to support valuation that could be much higher than where it’s currently trading.
CYTK is down nearly 25% versus the start of the year. In late 2020, Bristol Myers Squibb bought a similar clinical stage biopharmaceutical company, MyoKardia, for $13 billion.