Biotech stocks can provide sudden and magnificent returns, but they can be just as unforgiving. How can you decide which biotech stocks are worth investing in? We looked into it further.
We ran a screen of biotech stocks that are showing insider buying. If anyone knows what's going on with a company, it has to be the people who work there.
Many analysts follow insider buying trends exactly for that reason. Their transactions are closely monitored and can tell us a lot about where the business is heading.
Business section: investing ideas
If insiders are buying the stock of the biotech company they’re working for, they have to either think that the stock is undervalued or that something big is going to happen, like a drug getting FDA approval.
The final list from our screen follows. It shows biotech companies with market caps over $300 million and insider buying over the past six months. Do you think the insiders know something nobody else does?
List sorted by market cap. (Access free, interactive tools to analyze these ideas.)
3. Halozyme Therapeutics
4. ZIOPHARM Oncology
Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the stocks mentioned above. Analyst ratings sourced from Zacks Investment Research.
Disclosure: Kapitall's Danny Guttridge does not own any of the shares mentioned above. Insider data sourced from Yahoo! Finance; all other data sourced from Finviz. The Motley Fool has a disclosure policy.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.