Q1 earnings season is upon us, and the story so far seems to be a desperate one, with big brand stocks talking about historic shortfalls on both the top and bottom line data. But one sector seems to be a continued source of encouraging news about corporate performance: healthcare.
Most people don’t get dollar signs in their eyes when they think of healthcare stocks. But that’s probably short-sighted.
There are some remarkable growth and momentum plays in the space, and we are going to look at three interesting stocks fitting this description today: Inovio Pharmaceuticals Inc (NASDAQ:INO), ISW Holdings, Inc. (OTCMKTS:ISWH), and CytoDyn Inc (OTCMKTS:CYDY).
Inovio Pharmaceuticals Inc (NASDAQ:INO) has been in the news quite a bit lately based on the company’s work toward the development of a COVID-19 vaccine.
The company trumpets itself as a clinical stage biopharmaceutical company that develops active DNA immunotherapies and vaccines to prevent and treat cancers and infectious diseases. Its SynCon immunotherapy design has the ability to break the immune system’s tolerance of cancerous cells, as well as is intended to facilitate cross-strain protection against known, as well as new unmatched strains of pathogens, such as influenza.
Inovio Pharmaceuticals Inc (NASDAQ:INO) is involved in conducting and planning clinical programs of its proprietary SynCon immunotherapies for HPV-caused pre-cancers and cancers; prostate, breast, lung, and pancreatic cancers; hepatitis C virus; hepatitis B virus; human immunodeficiency virus; Ebola virus; middle east respiratory syndrome; and Zika virus.
Its partners and collaborators include MedImmune, LLC, The Wistar Institute, University of Pennsylvania, GeneOne Life Science Inc., Regeneron Pharmaceuticals, Inc., Genentech, Inc., Plumbline Life Sciences, Inc., the Parker Institute for Cancer Immunotherapy, Drexel University, National Microbiology Laboratory of the Public Health Agency of Canada, National Institute of Allergy and Infectious Diseases, United States Military HIV Research Program, U.S. Army Medical Research Institute of Infectious Diseases, National Institutes of Health, HIV Vaccines Trial Network, Defense Advanced Research Projects Agency, and Coalition for Epidemic Preparedness Innovations.
Shares have been acting very well over the past five days, up about 39% in that timeframe. Shares of the stock have powered higher over the past month, rallying roughly 71% in that time on strong overall action.
Inovio Pharmaceuticals Inc (NASDAQ:INO) generated sales of $279K, according to information released in the company’s most recent quarterly financial report. That adds up to a sequential quarter-over-quarter growth rate of -67.8% on the top line. In addition, the company has a strong balance sheet, with cash levels far exceeding current liabilities ($89.5M against $32M).
ISW Holdings, Inc. (OTCMKTS:ISWH) is a genuine emerging leadership player in the booming home healthcare space.
Home health spending is expected increase at a faster rate through 2027 than all other categories of care, according to a recent analysis from the Centers for Medicare & Medicaid Services (CMS) Office of the Actuary. Home health care spending is expected to reach more than $186 billion in 2027, according to the report. This is miles above any other category of health care service, including hospital inpatient care, physician and professional services, nursing facilities, prescription drugs, retail sales of medical products and literally everything else in the space.
But the stock has been flying under the radar in the market, and has only recently started to see a clear bid, with shares moving more than 150% higher in the past month.
That movement follows news from the company confirming a continuation of breakout financial performance for three consecutive quarters to close out 2019. And the company’s most recent communications suggest that streak will grow to at least five consecutive quarters with accelerating double-digit percentage growth on a sequential quarterly basis, which is extremely rare.
According to the most recent release from ISWH, “for the year ended December 31, 2019, ISW Holdings posted revenues of $527,151. Management notes that these results were achieved on accelerating sequential quarterly growth, with nearly half of those revenues appearing in Q4. Sequential growth in Q3 (versus Q2) was 26%. Sequential growth in Q4 (versus Q3) was 29%. The Company projects Sequential growth in Q1 2020 to come in at a new record level significantly outpacing Q4 2019 results.”
ISW Holdings, Inc. (OTCMKTS:ISWH) is also expanding: the company just announced that it is expanding outside of the state of Texas to as many as four other states, including a number of major population hubs (Las Vegas, Reno, Santa Fe, Phoenix, and The Villages). We wouldn’t be surprised to see the expansion continue to other areas with a similar profile.
Based on its recent jump in operational performance as well as its expansion move, we wouldn’t want to be short the stock in an environment where it continues to see sharp double-digit q/q growth despite the broad downturn.
CytoDyn Inc (OTCMKTS:CYDY) is a treatment play. We would distinguish this from vaccine plays like INO, NVAX, or the like. CYDY is more similar to GILD, which has recently been in the headlines due to its remdesivir anti-viral asset, which was originally developed for ebola some years ago.
CYDY is testing the efficacy of its HIV drug, leronlimab. So far, the company is actually riding a wave of positive momentum in terms of the direction of this narrative. As a result, shares of the stock are up as much as 900% in the past 3-4 months.
CytoDyn Inc (OTCMKTS:CYDY) promulgates itself as a late-stage biotechnology company that focuses on the clinical development and commercialization of humanized monoclonal antibodies to treat human immunodeficiency virus (HIV) infection.
Its lead product is PRO 140, a therapeutic anti-viral agent, which is in Phase IIb extension study for HIV as monotherapy, rollover study for HIV as a combination therapy, Phase IIb/III investigative trial for HIV, Phase Ib/II trial for triple-negative breast cancer, and Phase II trial for graft-versus-host disease. CytoDyn Inc is battling some balance sheet hurdles, with cash levels struggling to keep up with current liabilities ($1.2M against $29.7M, respectively).
