Biotechnology Stock Surges 20%, Approaching Key Buying Level

Biotechnology Stock Surges 20%, Approaching Key Buying Level

Ascending pharmaceutical company (ASND) is Tuesday’s pick for IBD 50 Stocks to Watch as it progresses to a buy pointst in a flat base. The stock’s superior sales growth helped it land on the elite list of growth stocks.




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Danish biotechnology develops treatments for cancers, endocrine diseases and other rare diseases. Its TransCon technology is a platform used to develop medicines combining biology and technology with the aim of improving efficacy, tolerability and comfort for caregivers.

Ascendis Pharma’s lead patented medicine in the United States, Skytrofa, is a pediatric human growth hormone used for the treatment of growth hormone deficiency in people over one year of age. It was approved for medical use in the United States in August 2021 and in the EU in January 2022.

On January 31, Ascendis announced that its Yorvipath, a treatment for parathyroid hormone replacement therapy, was now available. available in Germany and Austria.

Its pipeline of potential treatments includes thyroid therapies for adults, drugs for cancerous tumors and a drug for bone growth.

In January, Ascendis announced it and outside investors said Eyconisa company that develops, manufactures and sells its TransCon eye products.

Ascendis is based in Copenhagen, Denmark, and has offices in Germany and the United States. The stock belongs to the biotechnology group, which ranks 13th out of 197 IBD industry groups.

JPMorgan raised its price target from 165 to 167 and maintained its overweight on growth stocks on Tuesday.

Biotech growth stocks climb into a base

Ascendis Pharma is in a Second step flat base with a buy point of 161. Shares are about 9% below the buy point.

The growth stock is above its 50-day moving average after several tests of the line as the base developed. He recovered his 21-day exponential moving average on March 26. line of relative force is bumpy but has a sideways trend.

Stocks have gained about 19% in 2024 and 40% since breaking out of a cutting base in early December.

Huge sales growth expected to continue

Ascendis Pharma has not had a profitable year since 2018, according to Market increase. This is common among biotechnology companies because they invest heavily in research and development and may spend years working on products before they reach their markets.

Its quarterly losses are decreasing and going in the right direction.

But its sales have seen considerable growth. Revenue growth exploded with a 520% ​​increase in the fourth quarter, announced on February 7. Sales soared 239% to 701% over the previous four quarters.

Quarterly sales are expected to grow 136% in the first quarter, with estimates of 90% and 158% in the following two quarters, according to MarketSurge.

Growth stock has a respectable 84 Composite score but dull 33 Earnings per share as it continues to record losses. It is Accumulation/distribution rate of A- indicates fairly significant institutional buying over the past 13 weeks.

Mutual funds hold 75% of growth stocks, with 386 funds holding stocks in March, up from 265 in December.

Follow Kimberley Koenig for more stock market news on X/Twitter @IBD_KKoenig.

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