This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

A Time to Test Biotechs' Strength

Stocks in this article: BLUE EPZM XON AMGN ONXX NSTG PETX LPDX HTBX

Not bad for a platform company that is not yet profitable.

But Intrexon has a lot going for it. With a well-regarded biotech veteran, Randal Kirk, as its CEO, nine collaborations under way and programs not just in health care but also in food, energy and the environment, there is a lot for investors to be interested in.

Alan Mendelson, a partner with Latham & Watkins LLP, said that the story of an individual company matters a lot to investors. "Investors do bet on management teams. That helps a great deal. The science is important. If the company has licensing agreements, then that's validation from larger companies," he said.

But not all of the recent life sciences IPOs have done great. Medical device firms haven't even entered the fray this year, even though there were a few device IPOs in 2012. And diagnostics companies account for only three of this year's filings for IPOs, and the ones that began trading already, haven't exactly blasted out of the gate like the biotechs. NanoString Technologies Inc. (NSTG), which began trading June 26, priced below its expected range at $10 per share and hit a low of $7.01 since. LipoScience Inc. (LPDX) in January priced its IPO at $9 per share, at the bottom of a range that it had already dropped -- it was trading at a 60-day moving average of $6.55 per share at the end of July.

Other companies, like Aratana Therapeutics Inc. (PETX), which reformulates human drugs into animal therapies, postponed their IPOs, then priced significantly below the range they'd earlier indicated. And some very early-stage biotechs, like Heat Biologics Inc. (HTBX), have made their money, but are trading about even with their initial stock price.

Macro events also matter, according to Renaissance Capital. "We continue to believe U.S. IPO activity remains captive to underlying macroeconomic trends, as evidenced by the deeply discounted offerings that were completed in late June following the Fed announcement referring to chairman Ben Bernanke's comments that the central bank might start pulling back on asset sales . That said, companies are offering valuation haircuts rather than scrapping their deals altogether, indicating that demand for IPOs persists, albeit only at a reasonable price," according to the IPO report.

2 of 4

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,804.80 +26.65 0.15%
S&P 500 2,070.65 +9.42 0.46%
NASDAQ 4,765.38 +16.9840 0.36%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs