Various biotech stocks are in focus today, but Pacific Biosciences (NASDAQ:PACB) is one of the more notable names investors are watching right now. At the time of this writing, PACB stock is up 5% amid growing speculative interest in the sector.
Biotech names have been beaten up like other high-growth areas of the market. But alongside tech stocks, crypto and other more speculative segments, this group of stocks is finally seeing a nice rally. Today’s move is driven in part by macro forces and heightened mergers and acquisitions (M&A) activity in the sector, which has boosted valuations across the board.
In particular, retail investors appear to be diving into names like PACB stock following the high-profile short squeeze of Invitae (NYSE:NVTA) stock. Shares of Invitae ran up 300% following earnings when an apparent squeeze took hold.
However, retail investors aren’t the only ones jumping on PACB today. Cathie Wood is also snapping up the stock, adding more than 160,000 shares. For institution and retail investors, this is a strong vote of confidence for those considering Pacific Biosciences.
Let’s dive into whether this rally can be sustained or not.
Can PACB Stock Continue Its Ascent?
To be sure, the factors driving PACB stock today appear to be more on the speculative side. A short squeeze in a relevant company and buying activity from Cathie Wood aren’t really fundamental reasons to buy any stock. Thus, investors should take caution with such a run up in a short amount of time.
That said, should Pacific Biosciences report the kinds of numbers Invitae did, perhaps a surge is in order. This sector has been under pressure for some time. Accordingly, valuations look a lot better today than they have in a while.
Right now, PACB stock looks a little too speculative for my blood. But I’ll be watching shares closely from here. And I have a feeling many investors will do the same.
On the date of publication, Chris MacDonald did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.