MMR

2 Biotech Studs Under $10

Shares of Exelixis, Inc. (NASDAQ:EXEL) and Oncothyreon Inc (USA) (NASDAQ:ONTY) cost less than $10 -- and both have beaten the market

Sep 11, 2015 at 3:11 PM
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Since hitting a record high of $213.78 on May 20, the SPDR S&P 500 ETF Trust (NYSEARCA:SPY) has lost roughly 8.5%. Nonetheless, a number of stocks have performed very well during the last three-plus months, including plenty of stocks trading under $10 per share. Among the top outperformers under $10 are Exelixis, Inc. (NASDAQ:EXEL) and Oncothyreon Inc (USA) (NASDAQ:ONTY) -- both of which, not coincidentally, belong to the red-hot healthcare sector.

EXEL is currently resting at $5.88, up 85% since its close on May 20 -- in large part due to a successful late-stage study of its kidney cancer drug cabozantinib, as well as a recent thumbs up from Swiss regulators on its melanoma treatment cobimetinib. In fact, the shares have more than quadrupled in value in 2015.

Additional upside could be on the way, if the FDA gives EXEL's cobimetinib a nod in November, or if short sellers begin to hit the exits. Nearly one-quarter of Exelixis, Inc.'s float is sold short, representing over seven days of pent-up buying demand, at typical volumes.

Meanwhile, ONTY has tacked on more than 36% since late May to trade at $3.30, boosted by well-received data at the American Society of Clinical Oncology's (ASCO) meeting in early June. Year-to-date, the shares have shot up nearly 74%, with the broad-market swoon in August contained by their 20-week moving average.

The brokerage bunch apparently likes what it's seen out of Oncothyreon Inc, with 80% of analysts doling out "buy" or better ratings -- with not a single "sell" in sight. However, short interest has been ramping up in recent reporting periods, and now represents 11% of the equity's total float -- a six-day short squeeze, at the stock's average pace of trading.
 

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