What about Editas? By TipRanks
Stocks that allow gene editing have become very popular in recent years. There have been some interesting breakthroughs in recent years by various companies using CRISPR technology for editing the genomes patients.
This breakthrough, and the possible growth opportunities that these technologies can have for healthcare, has made gene editing stocks one of the best growth play on the market.
Cathie Wood, growth investing expert and guru agrees. Two of her key holdings are Intellia Therapeutics, (NASDAQ:), and Editas Medicine (NASDAQ)
Wood has a larger holding called Intellia. Editas is also outperforming it.
Editas is a great stock right now. EDIT stock rose after Intellia released its breakthrough trial data this year. This gene editing stock could produce its own set of similar-effective study data.
Let’s take a look at why EDIT stock could be a more risky, but better-reward investment. This stock is not my favorite. (See Editas Medicine stock charts on TipRanks)
Editas’ robust Pipeline
As per Editas Medicine’s website, the company will be manufacturing two kinds of gene modification medicines: in vivo, and ex vivo.
Already, eight projects have been launched by the Massachusetts-based company. This includes both gene editing medicine and cell therapy drugs. Editas will commercialize treatment for cancers, ocular disorders and other blood diseases.
Only two of the projects currently in development are at the beginning of clinical trials. It can take a long time to introduce a drug, with little chance of success. Even if the drug is developed after a few years, there’s no guarantee if the treatments would overcome the hurdles posed by FDA.
If the company’s portfolio of drugs succeeds, then this stock could be a compelling investment. There is a significant amount of risk with this stock.
Decent Foundations, At Least until 2023
Editas Medicine’s latest corporate presentation revealed that the company has sufficient funds to continue its operations through 2023. As per the latest earnings report published by the company, its cash and cash equivalents stood at $723 million, up by $211 million from the last sequential quarter.
The company’s minimal revenues are largely dependent on its development collaborations. Editas Medicine raked in approximately $6.5 Million revenue during the first quarter of 2021.
During the same period, this company had to incur expenses worth $63.4 million for R&D and administrative purposes. Editas Medicine is just another early-stage biotech company. Even though it is expensive, Editas Medicine does not generate any income. However, the stock offers tremendous potential.
It appears that the speculative boom in high-risk stocks is what caused the dramatic rise in EDIT stock this year. This stock is one that investors seem to be giving more credence to right now. It has the potential for gene editing stocks providing long-term healthcare.
Right now, there are many gene editing options. Competition is heated in this area.
Editas seems like an attractive high-risk/high-reward investment. Its potential pipeline seems attractive. Only two of the company’s projects are in clinical trial stages.
Stocks that gene edit genes were first introduced to the market around five-years ago. Trials only just started. This could be ground-floor territory for investors hoping for a better future. Alternatively, the FDA may decide to restrict gene editing stock from the majority of growth that investors expect.
Editas has been approved by FDA for Phase 1 and 2, which will be conducted on patients with sickle cells. This disease can only be treated with a bone marrow donation. It is possible that these clinical trials will yield impressive results in the very near future.
Wall Street’s Take
According to TipRanks analyst ratings consensus Editas has been rated a Moderate buy. There are eight analyst ratings. Six Buy recommendations and two Hold recommendations.
The average Editas price target is $60.71. Price targets of analysts can range anywhere from $40 to $80 per shares.
The Bottom Line
EDIT stock has fluctuated dramatically over the past three years, and there’s significant risk associated with this stock. The company’s status as a hyper-growth business may be attractive to long-term, growth-oriented investors.
This means that it is dependent on each investor’s risk profile in today’s market.
Disclosure: Chris MacDonald didn’t hold any position at the time this article was published
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