ACADIA, Neurocrine, Alkermes Are Out Of Favor. Is It Time To Buy?

by Trefis Team
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Our indicative theme of Out Of Favor Healthcare Stocks is down by about -10% year-to-date, versus the S&P 500 which is up by about 8% year-to-date.  This theme includes healthcare and pharma companies that have shown strong historical revenue growth, improving fundamentals, and yet have not rallied much this year due to Covid-19, which has reduced doctor visits and delayed patients from seeking care. Considering the strong historical performance of these companies, and their focus on specialized therapeutic areas, they should offer solid returns in the medium to long-term as the pandemic wanes.   While  ACADIA Pharmaceuticals (ACAD) stock has remained almost flat year-to-date, Arrowhead Research (ARWR) and Ionis Pharmaceuticals, Inc. (IONS) have fared the worst and are down by about -22%. Below is a bit more on the companies in our Out Of Favor Healthcare Stocks theme and their relative performance.

ACADIA Pharmaceuticals (ACAD) is a biopharmaceutical company that develops drugs targeted at central nervous system disorders. The stock is almost flat year-to-date.

Neurocrine Biosciences (NBIX) is a biopharmaceutical company that develops treatments for neurological and endocrine-related diseases and disorders. The stock is down by about -5% year-to-date.

BioMarin Pharmaceutical (BMRN) is a biotech company focused on enzyme replacement therapies. The stock has declined -6% this year.

Alkermes (ALKS) is a biopharmaceutical company that focuses on drugs for diseases in the central nervous system including schizophrenia and multiple sclerosis. The stock is down by about -16% year-to-date.

Ionis Pharmaceuticals, Inc. (IONS) is a biotech company that specializes in discovering and developing RNA-targeted therapeutics. The stock has dropped -22% this year.

Arrowhead Research (ARWR) is a biopharmaceutical company that focuses on treatments for Hepatitis B and cardiovascular disease. The stock is down by roughly -22% this year.

What if you’re looking for a more balanced portfolio instead? Here’s a high-quality portfolio to beat the market, with over 100% return since 2016, versus about 55% for the S&P 500. Comprised of companies with strong revenue growth, healthy profits, lots of cash, and low risk, it has outperformed the broader market year after year, consistently.

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