Investors are always hunting for the next big stock -- the dream stock whose price increases several times over when the market finally discovers it. It's easy to look back and discover the 10 best stocks of the past decade. But I'm more interested in the tools that can help me evaluate tomorrow's greatest companies.
Motley Fool CAPS offers a variety of resources to aid Fools in finding tomorrow's leaders. Our 150,000-member community is full of investors helping each other beat the market.
We'll enlist CAPS to screen for biotech companies, then get the story behind some of its more highly rated stocks. CAPS' nifty screener will help us find stocks with:
Then we'll tap the collective intelligence of our CAPS members to see whether these companies present real opportunities -- or whether the numbers fail to tell the true story.
Opinions with the numbers
Here are some of the more interesting stocks our screen returned.
|
Company
|
Revenue Growth Rate,
Past 3 Years
|
CAPS Rating
(out of 5)
|
|
Keryx Biopharmaceuticals (Nasdaq: KERX )
|
158.5%
|
***
|
|
VIVUS (Nasdaq: VVUS )
|
64.6%
|
***
|
|
Biogen Idec (Nasdaq: BIIB )
|
35.6%
|
***
|
Data and star rankings from CAPS as of Feb. 11.
Keryx Biopharmaceuticals
Keryx has shown good progress with its drug candidates in clinical trials recently, especially the news that its colon cancer drug, perifosine, showed a more than 60% improvement in overall survival in midstage trials. The company looks to begin late-stage trials in the second quarter, and is also working on other treatments for the drug that show promise. Top all this off with other expected late-stage trials for its kidney drug, Zerenex, and it's no wonder a solid following of CAPS investors see potentially brighter days ahead for the company.
At this point, about 91% of the 209 CAPS members rating Keryx Biopharmaceuticals see it outperforming the broader market.
VIVUS
Drugmaker VIVUS hopes to succeed in the lucrative weight-loss drug market, where attempts from others like Pfizer (NYSE: PFE ) and Merck (NYSE: MRK ) have fallen short. The company's shares shot to the moon last September when it released data from two phase 3 trials for its drug Qnexa, and many investors are hoping for a repeat performance. Similar to Arena Pharmaceuticals (Nasdaq: ARNA ) , VIVUS is awaiting an FDA decision for its weight-loss drug, which could come by the end of this year.
While approval isn't guaranteed, the company has tantalized some CAPS members with estimates that sales could surpass $1 billion, as a large percentage of the U.S. population is overweight or obese and looking for a solution. With the potential for the drug to reach blockbuster status -- and the indications it could help with other conditions like sleep apnea -- many CAPS members are bullish on VIVUS.
A total of 89% of the 251 CAPS members rating VIVUS have given the stock a thumbs-up.
Biogen Idec
While CAPS members still rate Biogen's smaller partner Acorda Therapeutics (Nasdaq: ACOR ) only one star after the approval of its multiple sclerosis drug, Ampyra, the community is much more bullish on Biogen itself. Biogen already has a couple of drugs that treat MS on its roster, and is seeking approval to market Ampyra -- which is approved to treat walking problems experienced by MS patients -- outside of the U.S. One of Biogen's MS drugs is Tysabri, which reached blockbuster status in 2009, but is facing an uncertain future due to a potentially deadly brain infection associated with it.
With activist investor Carl Icahn looking to expand his influence at the company, big changes could be looming, but that hasn't stopped roughly 93% of the 663 CAPS members rating Biogen Idec from voting for the stock to outpace the broader market.
Let 150,000 members be the jury
The collective wisdom of a huge pool of investors can help give context to a page of numbers from a stock screen. But individual investors are still the best judges of what to do with their own money. Fools should always perform their own due diligence.
Happily, it's easy to chime in with your own opinion. If you agree that these companies present dream opportunities -- or see more of a nightmare instead -- simply scroll down and add your thoughts in the comments box.
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