In the face of the worst pandemic in more than a century, biopharmaceuticals mighty and minuscule have found themselves united against a common enemy in the novel coronavirus. The attention has proven especially valuable for small companies such as iBio (NYSEAMERICAN:IBIO). IBIO stock spiked by more than 1,800% between February and July. Now there’s a fever for ya.
While no one would say today that the vaccine race is over — another breakthrough could be announced before I finish writing this — it’s looking like midnight at the ball for most if not all of the Cinderellas. The first effective vaccine candidates from Pfizer (NYSE:PFE) and Moderna (NASDAQ:MRNA) stand on the cusp of reaching the general public.
For speculators who made a killing on IBIO stock, there’s no real losing the vaccine competition when you won the portfolio sweepstakes. Regardless, the time has arrived to reconsider iBio on merits without connection to Covid-19.
IBIO Stock and Life After the Novel Coronavirus
Perhaps you’re thinking, “Is such a thing even possible?” After all, tiny biotechs can go for decades without attracting any attention for their efforts. Cold as it sounds, some investors bet on stocks with tenuous connections to curing Covid-19 as the world searched high and low for a vaccine savior. Those who bought IBIO stock before the first half of 2020 ranked among the big winners.
And yet, the most recent big development for IBIO stock came on Dec. 2, when the company announced it had been selected by Belgium-based ATB Therapeutics to produce antibody-toxin fusion proteins for treating cancer. As a result, IBIO stock shot up 10% that day, and exemplifies just the kind of product-related progress that investors need to watch going forward.
This is, after all, a company that could literally fit in your portfolio: It has just four employees. So any good news on the cancer-fighting front is sure to bolster share prices. Meanwhile, the one analyst weighing in on IBIO stock remains bullish. They’ve set a 12-month price target of $2 per share, which would mark a one-third jump from the current share price of $1.48.
A Promising Therapeutic
To be fair, iBio may still find itself playing a supporting role in the overall landscape of Covid-19 treatment, even if there’s no silver bullet in sight at its Newark, Del. headquarters.
As reported in BioSpace, iBio has developed a decoy molecule as a therapeutic for Covid-19. It acts like an antibody and fools Covid-19 into thinking it’s part of a human cell. Though it’s not a vaccine in and of itself, it advances the battle against the virus — perhaps significantly. (It may also appeal to those who will resist any conventional vaccine regardless of its promise.)
If you were to ask me how the molecule works, I’d have to decode phrases like “recombinant protein made from human angiotensin converting enzyme.” This is a lot like telling a neophyte investor to “seek alpha via Fibonacci retracements that incorporate key ratios such as 23.6%.” Suffice to say, iBio could find leverage as part of a greater Covid-19 strategy, which even someone like me can understand.
Time to Think Small
As speculative Covid-19 stocks go, including IBIO stock, I feel we’re seeing an end to the astronomical run-ups that dominated so much of 2020. Moderna may still have some room to run given its remarkable achievements, whereas companies like Inovio (NASDAQ:INO) can’t land with a thud fast enough as far as I’m concerned.
Though never a serious contender, it played the PR spin game into a share price spike of near 900% in the first half of the year. Investors made out big, but patients were always a super long shot for any gain, as Inovio hasn’t brought a single product to market in its 41-year history.
Then you have companies such as iBio, which has already shown tangible commitment and progress on medical turf far afield from Covid-19. You can feel good about investing in IBIO stock for the company’s positive work. What’s more, iBio’s fate isn’t tied to a make-or-break pandemic product effort, which gives it room to grow in 2021.
And with shares priced where they are, there isn’t much of a downside to a tidy investment in IBIO stock — that is, if you’re willing to factor in a return to volatility. I agree with my InvestorPlace colleague Josh Enomoto when he advises that you should pass if you’re counting on some sort of Covid-19 comeback. That ain’t happening, kiddos. Absent of speculator fuel, IBIO stock is what it is and not the fantasy of investors out to pack in more pandemic profit.
If that sits well with you, put down the vaccine vial and consider giving it a shot.
On the date of publication, Lou Carlozo did not have (either directly or indirectly) any positions in the securities mentioned in this article.
