4 Biotech Stocks That Could Keep Beating Wall Street

The biotechnology industry has lagged the S&P 500 so far this year, but most of the industry participants haven’t disappointed investors. The above-average performance of the industry has primarily been driven by mergers and acquisitions, initial public offerings, collaborative operations, introduction of biosimilars and new job vacancies.

The Zacks Medical - Biomedical and Genetics industry, which majorly consists of biotechnology stocks, has moved up just 2.2% year to date versus the Zacks S&P 500 composite’s gain of 22.6%. However, the major biotech ETFs and indexes have put up an impressive performance year to date. Among others, the SPDR S&P Biotech ETF (XBI) and ProShares Ultra Nasdaq Biotechnology (BIB) have surged 17% and 23.7%, respectively, so far this year.  

In fact, biotechnology stocks are a good investment irrespective of how the markets are performing. Investors can thus take a look at a few that have performed remarkably well so far in 2019.

M&As, IPOs, and Collaborations Keep Sector in Focus

The sector has been in the limelight since the beginning of this year. In January, Bristol-Myers Squibb Company (BMY - Free Report) announced that it will acquire Celgene Corporation (CELG - Free Report). This was followed by Takeda Pharmaceutical Company Limited’s (TAK - Free Report) acquisition of Shire in the same month.

In February, Eli Lilly and Company’s (LLY - Free Report) acquisition of Loxo Oncology made headlines. There were many other M&As announced during the period.

The number of initial public offerings has also been overwhelming this year. In fact, biotech IPOs have been rising steadily over the last few years.

Biotech firms require extensive financing, especially as they advance in their research. Going public is a great way to take care of the financing they need. It not only gives a company solid ground but also makes it more visible for acquisitions and collaborations. Adaptive Biotechnologies Corporation (ADPT - Free Report), NGM Biopharmaceuticals, Inc. (NGM - Free Report) and Alector, Inc. (ALEC - Free Report) are some biotech companies that went public this year.

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