Biotechnology Stocks

Biotechnology stocks are firms that are active in the sector and publicly traded. Biotechnology companies use applied biology for advancements in current methodologies in a variety of industries. The field uses living organisms and bio-processes in many sectors, such as medicine, engineering, agriculture and technology. Since there is a lot of research and development in this sector, small biotech stocks that can develop a new advancement in technology can become very wealthy firms and the stock price can move up sharply. Biotechnology stocks raise money in the public market to help fund this research.

Biotechs the Hottest Sector at This Time?

By Monday, December 1, 2014

Biotechs the Hottest Sector at This TimeOne of the hottest areas of the stock market over the last few years has been one of its most speculative. Biotechnology stocks, as evidenced by the NASDAQ Biotechnology Index, have been on a tear for the last three years.

This index was 1,000 at the end of 2011; it was 1,500 by the beginning of 2013; and now, it’s just shy of 3,200 for an al… Read More

Why I Like These Two Health Care Stocks

By Friday, August 29, 2014

If You Can Stand the Risk… Two Strong Healthcare StocksOne of the problems with pure-play biotechnology stocks is that they are 100% risk-capital securities in which the probability of success is entirely beyond your control.

But healthcare and related industry investments are very much worthwhile in an equity market portfolio for the simple reason that they can be so profitable.

One … Read More

Jumping on the Risk Bandwagon? Think Again

By Wednesday, August 20, 2014

The stock market has an underlying strength to it, seemingly only to be undone by geopolitical events. Fed action always has the potential to shock the system. Negative economic news isn’t fazing this market. On the back of a pretty decent second quarter, many corporate outlooks predict another year of decent growth, particularly with earnings. While the stock market retrenched recently, positive days are still led by the Dow Jones Transportation Average, the Russell 2000 Index, and the NASDAQ components, which are traditionally positive for broader sentiment. Some speculative fervor has come back to two stock market sectors that are traditionally volatile—biotechnology stocks and restaurant stocks. But there really isn’t an underlying trend to latch onto. Jumping on the bandwagon of risky stocks seems unwise considering the stock market is at an all-time record-high. This is a market where equity investors have to be highly selective and wait for the right opportunities to present themselves, if you’re considering new positions at all. This can be in the form of a specific sector theme (like oil and gas, for example) or looking for good companies that have retrenched for their own specific reasons. In any case, with the stock market at a record high, it’s difficult to find value, and new positions become entirely reliant on market momentum, not necessarily individual corporate achievement. There are very few companies that I would consider now, but within the context of a long-term stock market portfolio, investors want their money to be put to work. In equities, I still think that portfolio safety is the name of the game. This is a market that hasn’t experienced a material price correction for five years. There have been retrenchments and price consolidations, but no reset, no revaluation that would make stock market investors with cash want to jump into a marketplace still beset with huge monetary stimulus and strong balance sheets—a marketplace still extremely favorable to equities. Companies for consideration at this time that fit into my earnings (and dividends) safety list include Microsoft Corporation (MSFT), PepsiCo, Inc. (PEP), Johnson & Johnson (JNJ), and 3M Company (MMM). There should be exposure to oil and gas in this short list, too. Previously, I liked Kinder Morgan Energy Partners, L.P. (KMP), but with news that this high-yielding limited partnership is being bought out by Kinder Morgan, Inc. (KMI), I’m looking for a solid new pick in this sector. (See “This Company’s $70.0-Billion Acquisition a Boon for Investors.”) A lot of investors are more risk-tolerant than these mature enterprises might present. But institutional investors are still skittish; they are still buying earnings safety in this stock market. Accordingly, dividend-paying blue chips remain highly correlated to the broader market and for the investment risk, given that this market could experience a 20% correction at any time for a multitude of reasons, new buyers of equities should consider stocks offering earnings and dividends safety. In the equity market—which is a secondary market with a pricing mechanism subject to fear, greed, and the herd mentality—capital preservation is a worthy investment goal. So far in this bull market, blue chips have performed exceedingly well relative to the rest of the stock market and they are still where institutional investors want to be.The stock market has an underlying strength to it, seemingly only to be undone by geopolitical events. Fed action always has the potential to shock the system. Negative economic news isn’t fazing this market.

On the back of a pretty decent second quarter, many corporate outlooks predict another year of decent growth, particularl… Read More

Why You Shouldn’t Overhaul Your Portfolio Right Now

By Friday, August 15, 2014

Stocks Rolling Over Signal TroubleBiotechnology stocks and the Russell 2000 began rolling over at the beginning of July, followed by transportation stocks at the end of the month.

It’s definitely a signal that the stock market is tired, but after such a strong breakout performance in 2013, the market still hasn’t experienced a material price correction in quite … Read More

Why Exposure to Healthcare Sector Is a Must

By Friday, August 1, 2014

How These Companies Celebrate a Great QuarterIn what is on par with the course in today’s stock market, biotechnology firm Amgen Inc. (AMGN) posted double-digit revenue and earnings growth while raising its full-year outlook.

The kicker for this stock and its recent price strength was the news that the company plans to cut 12%–15% of its global workforce (2,400 to 2,900 emp… Read More