Drop in these 3 stocks is a ‘buying opportunity’, analysts say
The investing game is seldom straightforward. While there is no doubt that investors would like the choices that make up their portfolios always increase, the reality is more complicated. There are times when even the stocks of the world’s most successful companies have taken a downward trajectory for one reason or another. While it isn’t fun to watch a stock you own drift down, any savvy investor knows that while the fundamentals of the company are strong to begin with, pullback is often a gift in disguise. This is where the chance for good returns really comes in. “Buy the Dip” is not a cliché for no reason. With that in mind, we scoured the TipRanks database and picked out 3 names that have recently headed south, especially those identified by connoisseurs as representing a buying opportunity. Additionally, all 3 are classified as strong buys by analyst consensus and are expected to generate at least 70% of the gains over the next 12 months. Here are the details. Flexion Therapeutics (FLXN) Let’s first take a look at Flexion, a pharmaceutical company specializing in the development and commercialization of therapies for the treatment of musculoskeletal pain. The company currently has two drugs in preliminary clinical trials, but one that has already been approved by the FDA; Zilretta is an extended-release corticosteroid for the management of osteoarthritis knee pain. The drug received regulatory approval in 2017 and Flexion holds the exclusive worldwide rights. FLXN stock has found 2021 difficult and is down 30% year-to-date. However, “recent weakness,” according to Northland analyst Carl Byrnes, has created a “one-time buying opportunity.” Like many biopharmaceuticals, Flexion’s marketing efforts were hit hard at the height of the pandemic last year, as closures and restrictions impacted its operations. However, Byrnes predicts that Zilretta will show “stellar growth in 2021 and beyond.” “We remain confident that demand for ZILRETTA will continue to grow, supported by product awareness and positive clinical experiences of patients and healthcare professionals, augmented by improvements in interactions with healthcare professionals and deferral of total knee arthroplasty (TKA) surgical procedures, ”says the analyst. mentionned. Byrnes expects 2021 Zilretta sales to grow 45% year-over-year to $ 125 million, then grow another 50% to $ 187.5 million the following year. This income growth will go hand in hand with a massive appreciation in stocks; Byrne’s price target is $ 35, which suggests a ~ 339% rise over the next 12 months. Needless to say, Byrne’s rating is an outperformance (i.e. a buy). (To see Byrnes’ track record, click here) Except for one Hold, all of Byrne’s colleagues agree. With 9 buys, FLXN stock enjoys a Strong Buy consensus rating. While not as bullish as Byrne’s target, the average price target of $ 20.22 is still set to produce impressive returns of 153% within the 12-month time frame. (See FLXN stock market analysis on TipRanks) Protara Therapeutics (TARA) Staying in the pharmaceutical industry, we then have Protara. Unlike Flexion, biotechnology focused on cancer and rare diseases does not yet have approved therapies. However, the picture should soon become clear regarding the timing of a BLA (Biologics License Application) for TARA-002, the company’s experimental cell therapy for a rare pediatric indication – lymphatic malformations (LM ). TARA-002 is based on the immunopotentiator OK-432, currently approved as Picibanil in Japan and Taiwan for the treatment of multiple cancer indications as well as LM. Currently, Protara is seeking FDA acceptance that TARA-002 is comparable to OK-432. If all goes according to plan, the company anticipates a potential BLA filing in H2: 2021 and potential approval in H1: 2022. Protara shares have fallen 40% since the start of the year. That said, Guggenheim analyst Etzer Darout believes the stock is significantly undervalued. “We estimate peak risk-adjusted sales at ~ $ 170 million (75% PDS) in the US alone (exclusive to biologics until 2034-2035),” the analyst said. 5 stars. “The company has presented an ‘additional study scenario’ that estimates a US launch in 2022 and an ‘additional registration study’ scenario that estimates a 2023 launch and we see current levels as a buying opportunity. before regulatory clarity on LM. In addition, Tara is expected to submit an IND (new investigational drug) for a phase 1 trial for TARA-002 in 2H21 for the treatment of muscle non-invasive bladder cancer (NMIBC). Darout notes that 80% (~ 65,000) of all patients with newly diagnosed bladder cancer have this specific condition, of which about 45% “are high grade and have unmet needs.” The company also owns IV Choline, a Phase 3 ready asset, for which the FDA has already granted both orphan drug designation and accelerated designation for IFALD (liver disease associated with intestinal insufficiency). Based on all of the above, Darout rates TARA a buy and has a target price of $ 48 for the stocks. The implication for investors? Up a strong 225%. (To view Darout’s track record, click here) Overall, with 3 recent buy ratings under its belt, TARA is getting a strong buy from an analyst consensus perspective. The action is also supported by an optimistic average price target; at $ 43.67, stocks are expected to appreciate about 198% over the coming year. (See TARA stock market analysis on TipRanks) Green Thumb Industries (GTBIF) Last but not least is Green Thumb, one of the leading cannabis MSOs in the United States (multi-state operator). This Chicago-based company is a mainstay of the booming cannabis industry, with the second-highest market cap in the industry and impressive growth over the past year. In 2020, revenue increased 157% from 2019, reaching $ 556.6 million. That said, despite another excellent quarterly statement in March and a good position to capitalize on other states legalizing cannabis, the stock fell recently after the company was hit by a damning Chicago Tribune article. According to the Chicago Tribune, the company is the subject of a Fed investigation into “pay-to-play” payments relating to the cannabis licensing in Illinois. Against these allegations, GTBIF management stated that the allegations were unfounded and that there was no factual evidence to support them. In addition, the company stressed that it had not even been contacted by the authorities about this matter. Who to believe, then? It’s an easy choice, according to Scott Fortune of Roth Capital. “We believe these tenuous claims create an opportunity to own the best-in-class trader currently at 25% of recent highs,” the 5 atar analyst said. “In our view, GTI’s activities and execution history are not at risk in terms of seemingly baseless charges. We will continue to monitor any additional new evidence that may emerge, but we believe the allegations are unfounded. We believe the upside opportunity remains compelling at these levels. According to Fortune’s $ 45 price target, stocks will change hands for a 70% premium within a year. Fortune odds remain a buy. (To look at Fortune’s track record, click here) The negative news hasn’t done much to dampen the enthusiasm around this action on Wall Street. Analyst consensus attributes GTBIF a strong buy, based on 12 unanimous buys. The average price target, at $ 47.71, suggests a rise of 79% over the next 12 months. (See GTBIF Stock Market Analysis on TipRanks) To get great ideas for stocks traded at attractive valuations, visit TipRanks Best Stocks to Buy, a newly launched tool that brings together all the information about TipRanks stocks. Disclaimer: The opinions expressed in this article are solely those of the featured analysts. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.