We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
3 Under-$10 Drug Stocks Wall Street Analysts Recommend Buying
Read MoreHide Full Article
The year 2024 has been a mixed ride for the biotech industry. It started on a positive note, attracting investors’ attention in areas with great commercial potential, like obesity, immunology and gene therapy.
However, their interest started to wane in the second half of the year amid lower-than-expected third-quarter results, guidance cuts and pipeline setbacks. While Wall Street viewed Trump’s victory as an accelerant for M&A activity in the sector, the President-elect’s decision to nominate vaccine skeptic Robert F. Kennedy Jr. to run the Department of Health and Human Services concerned investors in biotech stocks. These factors have negatively impacted nearly all companies in the industry. Year to date, the biotech sector has declined nearly 14%.
Despite the above headwinds, we expect the biotech industry to remain a focal point for investors, driven by demand for innovative medicines. People could consider investing in biotech stocks for their high growth potential and resilience during economic downturns. The sector also benefits from M&A activity by pharma giants, which is expected to rise with the change in new administration.
Investing in low-priced stocks with the potential for a healthy return is a good idea. One of the safest options to capitalize on money-making opportunities is following Wall Street recommendations and their experts’ advice.
For this article, we have chosen three small biotechs — Allogene Therapeutics (ALLO - Free Report) , Rezolute (RZLT - Free Report) and Vanda Pharmaceuticals (VNDA - Free Report) . Each stock is priced below $10 with a solid Zacks Rank and robust average broker ratings. We have taken the help of the Zacks Stock Screener to select them.
Allogene Therapeutics
ALLO is developing allogeneic CAR T therapies for treating cancer, especially hematologic indications with high unmet needs. The most advanced candidate in its pipeline is cema-cel, which is being evaluated in the pivotal phase II ALPHA3 study as a frontline treatment for patients with large B cell lymphoma.
Apart from cema-cel, Allogene is also developing engineered allogeneic CAR-T cell therapy candidates for multiple myeloma and renal cell carcinoma in separate phase I studies. Management is also planning to explore the potential of allogeneic CAR-T cell therapies in autoimmune diseases and start an early-stage study with a new candidate in lupus/systemic lupus erythematosus indication by first-quarter 2025.
ALLO currently carries a Zacks Rank #2 (Buy). In the past 60 days, loss per share estimates for 2025 have narrowed from $1.46 to $1.34. Currently, Allogene has an average brokerage recommendation (ABR) of 1.61 on a scale of 1 (Strong Buy) to 5 (Strong Sell). ABR is the calculated average of actual recommendations made by brokerage firms and portends the stock’s potential. Based on these analyst projections, we expect an average price target of $9.17, suggesting a 390.37% upside to the current closing price of $1.95.
RZLT is a late-stage clinical biotech focused on improving outcomes for individuals with hypoglycemia caused by hyperinsulinism (HI). Rezolute’s lead pipeline drug is ersodetug (RZ358), which is being evaluated in the phase III sunRIZE study for congenital HI. Top-line data from this study is expected before the end of next year.
Rezolute has also initiated start-up activities for another late-stage study to evaluate ersodetug in patients with tumor HI. While patient enrolment is expected to start in first-half 2026, management expects to report top-line data from this study before 2026-end.
RZLT currently has a Zacks Rank #2. In the past 60 days, estimates for Rezolute’s 2025 loss per share have narrowed from $1.37 to $1.12. The stock has an ABR of 1.00. Based on analyst estimates, we expect a 180.87% upside to the current closing price of $4.44, indicating an average price target of $12.33.
Vanda Pharmaceuticals
VNDA is a commercial biotech company that generates revenues from the sale of its three commercial products — Fanapt, Hetlioz and Ponvory. Fanapt is approved in the United States for two indications — schizophrenia and acute treatment of manic or mixed episodes associated with bipolar I disorder. Hetlioz is approved to treat non-24-hour sleep-wake disorder and nighttime sleep disturbances in Smith-Magenis syndrome. Ponvory is an oral treatment approved to treat relapsing forms of multiple sclerosis.
Vanda also has a promising pipeline targeting multiple indications across the fields of neuroscience, immunology and oncology. By early 2025, management intends to submit regulatory filings with the FDA for two pipeline drugs — tradipitant (for preventing vomiting induced by motion sickness) and milsaperidone (for schizophrenia and acute bipolar I disorder indications).
VNDA currently has a Zacks Rank #2. In the past 60 days, estimates for Vanda’s 2025 loss per share have narrowed from 58 cents to 35 cents. The stock has an ABR of 1.67. Based on analyst estimates, we expect a 93.51% upside to the current closing price of $4.68, indicating an average price target of $9.25.
Zacks' 7 Best Strong Buy Stocks (New Research Report)
Valued at $99, click below to receive our just-released report predicting the 7 stocks that will soar highest in the coming month.
Image: Bigstock
3 Under-$10 Drug Stocks Wall Street Analysts Recommend Buying
The year 2024 has been a mixed ride for the biotech industry. It started on a positive note, attracting investors’ attention in areas with great commercial potential, like obesity, immunology and gene therapy.
However, their interest started to wane in the second half of the year amid lower-than-expected third-quarter results, guidance cuts and pipeline setbacks. While Wall Street viewed Trump’s victory as an accelerant for M&A activity in the sector, the President-elect’s decision to nominate vaccine skeptic Robert F. Kennedy Jr. to run the Department of Health and Human Services concerned investors in biotech stocks. These factors have negatively impacted nearly all companies in the industry. Year to date, the biotech sector has declined nearly 14%.
Despite the above headwinds, we expect the biotech industry to remain a focal point for investors, driven by demand for innovative medicines. People could consider investing in biotech stocks for their high growth potential and resilience during economic downturns. The sector also benefits from M&A activity by pharma giants, which is expected to rise with the change in new administration.
Investing in low-priced stocks with the potential for a healthy return is a good idea. One of the safest options to capitalize on money-making opportunities is following Wall Street recommendations and their experts’ advice.
For this article, we have chosen three small biotechs — Allogene Therapeutics (ALLO - Free Report) , Rezolute (RZLT - Free Report) and Vanda Pharmaceuticals (VNDA - Free Report) . Each stock is priced below $10 with a solid Zacks Rank and robust average broker ratings. We have taken the help of the Zacks Stock Screener to select them.
Allogene Therapeutics
ALLO is developing allogeneic CAR T therapies for treating cancer, especially hematologic indications with high unmet needs. The most advanced candidate in its pipeline is cema-cel, which is being evaluated in the pivotal phase II ALPHA3 study as a frontline treatment for patients with large B cell lymphoma.
Apart from cema-cel, Allogene is also developing engineered allogeneic CAR-T cell therapy candidates for multiple myeloma and renal cell carcinoma in separate phase I studies. Management is also planning to explore the potential of allogeneic CAR-T cell therapies in autoimmune diseases and start an early-stage study with a new candidate in lupus/systemic lupus erythematosus indication by first-quarter 2025.
ALLO currently carries a Zacks Rank #2 (Buy). In the past 60 days, loss per share estimates for 2025 have narrowed from $1.46 to $1.34. Currently, Allogene has an average brokerage recommendation (ABR) of 1.61 on a scale of 1 (Strong Buy) to 5 (Strong Sell). ABR is the calculated average of actual recommendations made by brokerage firms and portends the stock’s potential. Based on these analyst projections, we expect an average price target of $9.17, suggesting a 390.37% upside to the current closing price of $1.95.
You can see the complete list of today’s Zacks #1 Rank stocks here.
Rezolute
RZLT is a late-stage clinical biotech focused on improving outcomes for individuals with hypoglycemia caused by hyperinsulinism (HI). Rezolute’s lead pipeline drug is ersodetug (RZ358), which is being evaluated in the phase III sunRIZE study for congenital HI. Top-line data from this study is expected before the end of next year.
Rezolute has also initiated start-up activities for another late-stage study to evaluate ersodetug in patients with tumor HI. While patient enrolment is expected to start in first-half 2026, management expects to report top-line data from this study before 2026-end.
RZLT currently has a Zacks Rank #2. In the past 60 days, estimates for Rezolute’s 2025 loss per share have narrowed from $1.37 to $1.12. The stock has an ABR of 1.00. Based on analyst estimates, we expect a 180.87% upside to the current closing price of $4.44, indicating an average price target of $12.33.
Vanda Pharmaceuticals
VNDA is a commercial biotech company that generates revenues from the sale of its three commercial products — Fanapt, Hetlioz and Ponvory. Fanapt is approved in the United States for two indications — schizophrenia and acute treatment of manic or mixed episodes associated with bipolar I disorder. Hetlioz is approved to treat non-24-hour sleep-wake disorder and nighttime sleep disturbances in Smith-Magenis syndrome. Ponvory is an oral treatment approved to treat relapsing forms of multiple sclerosis.
Vanda also has a promising pipeline targeting multiple indications across the fields of neuroscience, immunology and oncology. By early 2025, management intends to submit regulatory filings with the FDA for two pipeline drugs — tradipitant (for preventing vomiting induced by motion sickness) and milsaperidone (for schizophrenia and acute bipolar I disorder indications).
VNDA currently has a Zacks Rank #2. In the past 60 days, estimates for Vanda’s 2025 loss per share have narrowed from 58 cents to 35 cents. The stock has an ABR of 1.67. Based on analyst estimates, we expect a 93.51% upside to the current closing price of $4.68, indicating an average price target of $9.25.