3 “Perfect 10” Stocks to Snap Up Now
Contributor Jul 28, 2020 7:08PM EDT
Wall Street is sending mixed signals. While the S&P 500 is up 45% from its March lows, the market was choppy throughout most of June and July. On top of this, new COVID-19 cases are being reported at an alarming rate and trade tensions between the U.S. and China are flaring. What does all of this mean? The investing game has changed, so new strategies are needed to keep up with the new rules.
TipRanks has a tool that offers more than just an evaluation on a fundamental and technical basis. Providing a more comprehensive stock analysis, the Smart Score pulls together 8 commonly used predictive metrics, and collates all of the data into a single numerical score. This score ranges from 1 to 10, with 10 being assigned to the names most likely to outperform.
Using TipRanks’ database, we pinpointed three stocks that have earned the enviable “Perfect 10” Smart Score. Let’s dig a bit deeper into the details.
Arrowhead Pharmaceuticals (ARWR)
Through its versatile drug discovery and development platform designed using its patented technologies, Arrowhead Pharmaceuticals develops therapies that target intractable diseases by silencing the genes that cause them. Given its impressive development pipeline, some members of the Street believe that it’s time to take another look at this Perfect 10.
Currently, Phase 1 studies of ARO-APOC3 and ARO-ANG3 are fully enrolled, with updates potentially being provided at the European Society of Cardiology in late August, American Heart Association in November and the National Lipid Association meeting in December. Writing for Piper Sandler, five-star analyst Edward Tenthoff has been impressed by ARWR thus far.
Looking at interim Phase 1 multi-dose data on ARO-APOC3, the therapy was able to generate a 95% reduction in TG. Additionally, ARO-ANG3 demonstrated an LDLc reduction of 39-42% in hypercholesterolemia patients on top of background therapy and a TG reduction of 79% in hypertriglyceridemia patients. Not to mention, the safety and tolerability profile was robust.
Weighing in on the implications, Tenthoff stated, “Clean safety and lipid lowering will enable initiation of pivotal trial starts of ARO-APOC3 in Multifactorial Chylomicronemia (MCM) syndrome and a Phase IIb study of ARO-ANG3 in mixed dyslipedemia by 1H:21. Amgen could report Phase I AMG-890 data and start a Phase II study triggering a milestone.”
Even though COVID-19 forced the company to halt the Phase 2/3 SEQUOIA and open-label Phase 2 AROAAT2002 studies of ARO-AAT, both have now been restarted. The AROAAT2002 study is assessing pre- and post- ARO-AAT treatment biopsies to measure histological liver disease activity over two years, with ARWR potentially releasing six-month biopsy data from the first cohort at AASLD. “While histological changes are not expected at this point, observation of reduction in production of pathological misfolded AAT protein would indicate drug activity,” Tenthoff added.
The company also has other ongoing clinical activity including Phase 1 studies for ARO-HSD to treat NASH, ARO-HIF1 in kidney cancer and ARO-ENaC for cystic fibrosis, and thus, the deal is sealed for Tenthoff. In addition to reiterating an Overweight rating, he kept his $80 price target as is. A twelve-month gain of 65% could be in store, should the analyst’s thesis play out in the year ahead. (To watch Tenthoff’s track record, click here)
Judging by the consensus breakdown, other analysts also like what they’re seeing. 5 Buys and a single Hold add up to a Strong Buy consensus rating. Based on the $64.17 average price target, the upside potential comes in at 33%. (See ARWR stock analysis on TipRanks)