11 Best Pharma and Biotech Stocks to Buy According to Jim Simons’ Euclidean Capital
In this article, we will discuss the 11 best pharma and biotech stocks to buy according to Jim Simons' Euclidean Capital. If you want to skip our detailed analysis of Simons' history, investment philosophy, and hedge fund performance, go directly to the 5 Best Pharma and Biotech Stocks to Buy According to Jim Simons' Euclidean Capital.
Jim Simons is the President of Euclidean Capital, a family office. He founded probably the most successful quantitative investment firm in the world, Renaissance Technologies, in 1982 and retired in 2010. Although, he still plays a role at Renaissance and profits from its funds. Renaissance Capital is one of the best-performing hedge funds in the world.
Euclidean Capital, based in New York, handles and invests all the assets owned by Jim Simons. The hedge fund of Jim Simons concentrates primarily on venture capital investments in the sectors of biological science, public health care, cybernetics, web technology, food, and biotech. The fund centralizes on investments in the United States as 70% of the portfolio companies are located in the United States. The firm’s 13F portfolio is valued nearly $298 million as of the end of the first quarter of 2021.
Medical, pharma and biotech stocks suffered strong scrutiny during 2020 and early 2021 because of CV-19; however, the instability generates interesting trading possibilities. 2020 was a remarkable year for the medical and pharmaceutical sector as several stocks recorded all-time highs. The new pandemic's beginning has rekindled interest in the pharmaceutical industry as a whole.
Health is the primary focus of every individual, and as such, pharma and biotech shares are mostly a good bet in the long term. On the other hand, companies like Annovis Bio, Inc. (NYSE: ANVS), Cassava Sciences, Inc. (NASDAQ: SAVA), and Atossa Therapeutics, Inc. (NASDAQ: ATOS) are good pharma and biotech stocks to invest in.
Annovis Bio, Inc. (NYSE: ANVS) is a clinical-stage drug platform company. On May 24, Annovis Bio announced that it launched an underwritten offering in which it publicly offered 1 million common stock at $50 per share. The net proceeds from the public offering will go towards general corporate purposes and the execution of the Phase 3 ANVS401 trail in Alzheimer's disease in persons with Down syndrome. Dallas-based investment firm Ikarian Capital is a leading shareholder in Annovis Bio, Inc. (NYSE: ANVS), with 193,368 shares worth more than $5 million. The company’s shares have gained a whopping 1,563.85% over the last 12 months.
Cassava Sciences, Inc. (NASDAQ: SAVA) currently has a $3.63 billion market capitalization and was able to deliver a 3,347.77% return in the past 12 months. On July 20, H.C. Wainwright analyst Vernon Bernardino raised the firm's price target on Cassava Sciences to $124 from $97 and kept a “Buy” rating. On March 23, Cassava Sciences, Inc. (NASDAQ: SAVA) posted earnings for the first quarter of 2021. It reported earnings per share of -$0.09, missing market predictions by $0.04. Marshall Wace LLP is the biggest stakeholder in the company, with 282,793 shares worth $12.71 million.
Atossa Therapeutics, Inc. (NASDAQ: ATOS) is a clinical-stage biopharmaceutical company that discovers and develops medicines in the areas of cancer and contagious diseases. On July 7, Atossa Therapeutics obtained a regulatory approval from HREC to start a clinical study of AT-H201 in Australia. The nebulized formulation, AT-H201, is being prepared as an inhalation therapy for critically ill COVID-19 patients. On May 14, Atossa Therapeutics, Inc. (NASDAQ: ATOS) posted earnings results for the first three months of 2021. The earnings per share was -$0.04, beating market predictions by $0.01. The company is getting the attention of the smart money, as 6 hedge funds tracked by Insider Monkey reported owning stakes in the company at the end of the first quarter of 2021, up from 3 funds a quarter earlier.
Jim Simons of Renaissance Technologies
The pharmaceutical industry isn’t the only sector facing the volatility. The hedge fund industry that once used to post sterling gains is also feeling the reverberations of the changing financial landscape. The hedge fund industry’s reputation has been tarnished in the last decade, during which its hedged returns couldn’t keep up with the unhedged returns of the market indices. On the other hand, Insider Monkey's research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by more than 124 percentage points since March 2017. Between March 2017 and May 29, 2021, our monthly newsletter's stock picks returned 206.8%, vs. 91% for the SPY. Our stock picks outperformed the market by more than 115 percentage points (see the details here). That's why we believe hedge fund sentiment is a handy indicator that investors should consider. You can subscribe to our free newsletter on our homepage to receive our stories in your inbox.
Here are some of the 10 best pharma and biotech stocks to buy according to Jim Simons' Euclidean Capital. We picked these pharmaceutical stocks from the Q1 portfolio of Simons’ hedge fund.
Best Pharma and Biotech Stocks to Buy According to Jim Simons' Euclidean Capital
11. Rubius Therapeutics, Inc. (NASDAQ: RUBY)
Simons' Stake Value: $339,000 Percentage of Jim Simons' 13F Portfolio: 0.11% Number of Hedge Fund Holders: 11
Rubius Therapeutics, Inc. (NASDAQ: RUBY) is a clinical-stage biopharmaceutical company that concentrates on the development of red cell therapeutics for the medication of patients with serious diseases. It was founded in 2013 and ranks tenth on the list of 10 best pharma and biotech stocks to buy according to Jim Simons' Euclidean Capital. Rubius shares have gained about 250.25% over the last 12 months.
On June 23, Rubius Therapeutics, Inc. (NASDAQ: RUBY) declared that the first patient has been dosed in a new Phase 1 arm of the ongoing Phase 1/2 clinical trial of RTX-240 in combination with Merck's KEYTRUDA for the treatment of patients, with locally complicated solid tumors. RTX-240 strengthens the immune system. On May 10, Rubius Therapeutics, Inc. (NASDAQ: RUBY) posted earnings for the first quarter of 2021. It reported earnings per share of -$0.51, beating market predictions by $0.02.
The stock is a new arrival on Jim Simons' portfolio, as his hedge fund bought about 12,791 shares of Rubius Therapeutics, Inc. (NASDAQ: RUBY), worth $339. The company is getting the attention of the smart money, as 11 hedge funds tracked by Insider Monkey reported owning stakes in the company in the first quarter, up from 9 funds a quarter earlier.
Among the notable holdings of the most reliable pharma and biotech stocks as of the first quarter of 2021include Annovis Bio, Inc. (NYSE: ANVS), Cassava Sciences, Inc. (NASDAQ: SAVA) and Atossa Therapeutics, Inc. (NASDAQ: ATOS), Rubius Therapeutics, Inc. (NASDAQ: RUBY) is also one of the pharma and biotech stocks to buy.
10. Vir Biotechnology, Inc. (NASDAQ: VIR)
Simons' Stake Value: $1,326,000 Percentage of Jim Simons' 13F Portfolio: 0.44% Number of Hedge Fund Holders: 9
Vir Biotechnology, Inc. (NASDAQ: VIR) is a clinical-stage immunology company, which develops therapeutic goods to treat and prevent severe infectious diseases. It was founded in 2016, and it ranks tenth on the list of 10 best pharma and biotech stocks to buy according to Jim Simons' Euclidean Capital. Vir Biotechnology shares have returned investors more than 39% in returns year-to-date.
On July 15, Vir Biotechnology, Inc. (NASDAQ: VIR) declared that it dosed the first patient in the Phase 2 MARCH trial evaluating VIR-2218 in combination with VIR-3434 to treat patients with severe hepatitis B virus infection. On June 3, Baird analyst Joel Beatty initiated a coverage on Vir Biotechnology with a “Neutral” rating and a price target of $45.
Vir Biotechnology, Inc. (NASDAQ: VIR) is the latest addition in Jim Simons' hedge fund portfolio, as Euclidean Capital bought 25,864 shares of the company, worth $1.33 million. The company is getting the attention of the smart money, as 9 hedge funds tracked by Insider Monkey reported owning stakes in the company in the first quarter of 2021, up from 5 funds a quarter earlier.
Among the notable holdings of the most reliable pharma and biotech stocks as of the first quarter of 2021include Annovis Bio, Inc. (NYSE: ANVS), Cassava Sciences, Inc. (NASDAQ: SAVA) and Atossa Therapeutics, Inc. (NASDAQ: ATOS), Vir Biotechnology, Inc. (NASDAQ: VIR) is also one of the pharma and biotech stocks to buy.
9. Beam Therapeutics Inc. (NASDAQ: BEAM)
Simons' Stake Value: $2,492,000 Percentage of Jim Simons' 13F Portfolio: 0.83% Number of Hedge Fund Holders: 18
Beam Therapeutics Inc. (NASDAQ: BEAM) operates as a biotechnology company, which develops DNA based editing technologies for the medication of human infections. It was founded in 2017 and is placed ninth on the list of 10 best pharma and biotech stocks to buy according to Jim Simons' Euclidean Capital. Beam shares have gained about 339.99% in value over the last 12 months.
On June 29, Wedbush analyst David Nierengarten raised the price target on Beam Therapeutics Inc. (NASDAQ: BEAM) to $149 from $114 and maintained an “Outperform” rating. On June 30, Beam Therapeutics declared that it entered into a five-year agreement with Apellis Pharmaceuticals, Inc. (NASDAQ: APLS) to develop medicines for complement-driven diseases. Beam will obtain a $50 million payment on signing the agreement and a $25 million payment one year later.
The stock is a new arrival on Jim Simons' portfolio, as his hedge fund bought about 31,131 shares of the company, worth $2.49 million. Beam Therapeutics Inc. (NASDAQ: BEAM) is also getting the attention of the smart money, as 18 hedge funds tracked by Insider Monkey reported owning stakes in the company in the first quarter of 2021, up from 14 funds a quarter earlier.
Among the notable holdings of the most reliable pharma and biotech stocks as of the first quarter of 2021include Annovis Bio, Inc. (NYSE: ANVS), Cassava Sciences, Inc. (NASDAQ: SAVA) and Atossa Therapeutics, Inc. (NASDAQ: ATOS), Beam Therapeutics Inc. (NASDAQ: BEAM) is also one of the pharma and biotech stocks to buy.
Baron Funds, in their first quarter 2021 investor letter, mentioned Beam Therapeutics Inc. (NASDAQ: BEAM). Here is what the fund said:
“Beam Therapeutics Inc. is a biotechnology company pioneering a novel technology called base editing, which allows for individual base pairs (the letters of DNA) to be modified. Shares fell along with other biotechnology stocks driven by a sudden rise in treasury yields. Early stage biotechnology stocks are particularly sensitive to interest rates because their cash flows are further in the future. We believe we are entering into a phase of significant advancement for the gene editing field that will eventually lead to curative therapies, and we think Beam has a unique platform technology.”
8. Constellation Pharmaceuticals, Inc. (NASDAQ: CNST)
Simons' Stake Value: $12,966,000 Percentage of Jim Simons' 13F Portfolio: 4.33% Number of Hedge Fund Holders: 26
Constellation Pharmaceuticals, Inc. (NASDAQ: CNST) is a biopharmaceutical company. The company was founded in 2008 and stands eighth on the list of 10 best pharma and biotech stocks to buy according to Jim Simons' Euclidean Capital. Constellation currently has a $1.63 billion market capitalization.
On May 10, Constellation Pharmaceuticals, Inc. (NASDAQ: CNST) posted earnings for the first quarter of 2021. It reported earnings per share of -$0.84, missing market predictions by $0.05. On June 2, Constellation made public its agreement with MorphoSys AG (NASDAQ: MOR), whereby MorphoSys will procure Constellation for $34 per share in cash for a total value of about $1.7 billion.
Jim Simons' Euclidean Capital currently owns 554,325 shares of Constellation Pharmaceuticals, Inc. (NASDAQ: CNST) worth $12.97 million. Havens Advisors is the biggest stakeholder in the company, with 67,963 shares worth $2.30 million.
Among the notable holdings of the most reliable pharma and biotech stocks as of the first quarter of 2021include Annovis Bio, Inc. (NYSE: ANVS), Cassava Sciences, Inc. (NASDAQ: SAVA) and Atossa Therapeutics, Inc. (NASDAQ: ATOS), Constellation Pharmaceuticals, Inc. (NASDAQ: CNST) is also one of the pharma and biotech stocks to buy.
7. RAPT Therapeutics, Inc. (NASDAQ: RAPT)
Simons' Stake Value: $16,335,000 Percentage of Jim Simons' 13F Portfolio: 5.46% Number of Hedge Fund Holders: 13
RAPT Therapeutics, Inc. (NASDAQ: RAPT) is a clinical-stage immunology-based biopharmaceutical company, which focuses on discovering medicines for oncology and inflammatory diseases. It was founded in 2015 and is ranked seventh on the list of 10 best pharma and biotech stocks to buy according to Jim Simons' Euclidean Capital. RAPT currently has a $968.17 million market capitalization and was able to deliver a 30.38% return in the past 12 months.
On June 21, Piper Sandler analyst Edward Tenthoff initiated a coverage on RAPT Therapeutics, Inc. (NASDAQ: RAPT), rating it as “Overweight,” with a price target of $61. On June 14, RAPT Therapeutics (NASDAQ: RAPT) declared positive topline results from Phase 1b trial of RPT193 monotherapy in Atopic Dermatitis.
The hedge fund chaired by Jim Simons holds 735,801 shares in RAPT Therapeutics, Inc. (NASDAQ: RAPT) worth $16.34 million. It is the second-largest holding of the New York-based fund. Perceptive Advisors is the company’s most significant stakeholder, with 2.48 million shares worth $55 million.
Among the notable holdings of the most reliable pharma and biotech stocks as of the first quarter of 2021include Annovis Bio, Inc. (NYSE: ANVS), Cassava Sciences, Inc. (NASDAQ: SAVA) and Atossa Therapeutics, Inc. (NASDAQ: ATOS), RAPT Therapeutics, Inc. (NASDAQ: RAPT) is also one of the pharma and biotech stocks to buy.
6. Foghorn Therapeutics Inc. (NASDAQ: FHTX)
Simons' Stake Value: $16,623,000 Percentage of Jim Simons' 13F Portfolio: 5.56% Number of Hedge Fund Holders: 8
Foghorn Therapeutics Inc. (NASDAQ: FHTX) is mainly in the business of pharmaceutical preparations. The company was founded in 2015, and it stands sixth on the list of 10 best pharma and biotech stocks to buy according to Jim Simons' Euclidean Capital. Foghorn currently has a $363.67 million market capitalization.
On May 17, Foghorn Therapeutics Inc. (NASDAQ: FHTX) announced that the first patient has been dosed in a first-in-human medical trial of FHD-286 in metastatic uveal melanoma. FHD-286 is the first drug competitor directly aiming the chromatin regulatory system to enter clinical trials.
Euclidean Capital holds 1.26 million shares in Foghorn Therapeutics Inc. (NASDAQ: FHTX), worth over $16 million, representing 5.56% of their portfolio. There were 8 hedge funds in our database that held stakes in Foghorn Therapeutics at the end of the first quarter of 2021, the same as the quarter earlier.
Among the notable holdings of the most reliable pharma and biotech stocks as of the first quarter of 2021include Annovis Bio, Inc. (NYSE: ANVS), Cassava Sciences, Inc. (NASDAQ: SAVA) and Atossa Therapeutics, Inc. (NASDAQ: ATOS), Foghorn Therapeutics Inc. (NASDAQ: FHTX) is also one of the pharma and biotech stocks to buy.
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Disclosure: None. 11 Best Pharma and Biotech Stocks to Buy According to Jim Simons' Euclidean Capital is originally published on Insider Monkey.
