Worries about resurging COVID-19 cases around the world, spurred in part by the rise of the highly transmissible Delta variant, helped send markets in a tailspin Monday.
The Dow dropped about 2.1% Monday, which marked the worst day for the index since October 28 last year, while the S&P 500 dropped 1.6% and the NASDAQ fell 1.1%.
The Centers for Disease Control and Prevention (CDC) said the number of new COVID-19 cases in the U.S. averaged about 26,000 per day over the last week, which is more than double what it was a month ago. Meanwhile, cases are rising everywhere from Japan, which is hosting the summer Olympics under strict quarantine rules, to Indonesia and across Europe.
The World Health Organization (WHO) recently found an 11.5% rise in global cases over the past week, and a 1% increase in related deaths. Cases in Europe increased 21% over the past week, while the Western Pacific region saw a 30% spike.
Interestingly, nearly a quarter of the global population has received at least a single dose of one of several COVID-19 vaccines. That represents over three billion doses administered so far, with close to 30 million more doses given worldwide each day. And it leaves a lot of room to grow the number of vaccinated people, particularly in countries that have received relatively few doses so far.
So, it’s little surprise then that some of the companies behind the COVID-19 vaccines have seen their stocks rise as a result.
Case in point: BioNTech SE (BNTX).
The German biotech company has collaborated with Pfizer Inc. (PFE) to develop a COVID-19 vaccine.
I recommended the stock to my Growth Investor subscribers back in May, ahead of its first-quarter earnings announcements. The company went on to report stunning sales and earnings.
Total sales surged to 2.05 billion euros, up from 27.7 million euros in the first quarter of 2020. First-quarter earnings per share came in at $5.35, which crushed analysts’ expectations for $3.76 per share by 42.3%.
In June, the company announced it will supply an additional 600 million doses of its COVID-19 vaccine to the European Union (EU). BioNTech has already shipped more than 450 million doses of its vaccine around the world, and it has agreements for more than 1.8 billion doses for 2021.
More recently, New Zealand announced that it has granted provisional approval for the BioNTech-Pfizer vaccine for children aged 12 to 15 years of age. The vaccine was also approved by Switzerland for use in this age group at the beginning of the month. Clinical trials have shown that the vaccine has a 100% efficiency in this age group.
An Exciting Pipeline
Interestingly, though, BioNTech is a biotechnology company that’s more focused on developing treatments for cancer. BioNTech was founded back in 2008 with a goal to better understand how patients’ cancer tumors are different and why individual treatments were necessary.
Primarily, BioNTech focuses on cancer immunotherapy that utilizes a patient’s own immune system—mRNA therapeutics, engineered cell therapies, antibodies and small molecule immunomodulators comprise the company’s vast pipeline. Since its founding, BioNTech has developed more than 20 products and treated more than 440 patients with 17 different tumors.
BioNTech currently has several candidates in clinical trials for breast cancer, ovarian cancer, prostate cancer, head and neck cancer, advanced melanoma, solid tumors and pancreatic cancer.
And this week, BioNTech announced it will further its goal of developing cancer therapies with the acquisition of a U.S.-based manufacturing plant from Kite, a subsidiary of Gilead Sciences Inc. (GILD), for an undisclosed amount.
The technology surrounding the deal involves neoantigen T-cell receptor cell therapy, which is a state-of-the-art approach to treating cancer. Scientists genetically modify an individual’s immune cells known as T-cells to boost their potency at finding and killing tumors.
The deal will be used to bolster the work underway in BioNTech’s early stage clinical trials with Genentech to treat melanoma and other solid tumors with the therapy.
News of the acquisition Monday sent BioNTech shares soaring over 6%. Since May 3, a week before the company reported earnings, the stock is up nearly 30%, compared to the S&P 500’s 4% gain and the NASDAQ’s 5.5% rise over the same timeframe.
The company also earns a “Strong Buy” and a Total Grade of “A” from my Portfolio Grader, as well as an “A” for its Quantitative Grade, which represents institutional buying pressure under the stock.
Given the success of its COVID-19 vaccine, and the potential of its cancer treatments, BioNTech is looking to reward its shareholders further.
Ahead of BioNTech’s second-quarter announcements, scheduled for August 9, Wall Street expects the company will bring in $8.86 per share in earnings, compared to $5.33 per share in the first quarter. Analysts expect revenue will climb 55.5% from the prior quarter to $3.8 billion. And in the past 90 days, six analysts increased their earnings estimates for the company.
As you know, positive analyst revisions typically precede future earnings surprises.
BioNTech is currently ranked No. 1 on my Top 5 recommendations on the Growth Investor Buy List.
And it’s not the only biotech company working on a COVID-19 vaccine I like right now. In fact, another biotech I’m recommending to Growth Investor subscribers that’s developing its own vaccine has climbed over 18% in the past week and is up over 89% so far this year.
Of course, I’m not only recommending biotech companies right now, My Growth Investor Buy List is also filled with fundamentally superior stocks in several of the most explosive sectors of the economy, like internet technology, semiconductors and artificial intelligence (AI). So, my Growth Investor Buy List represents the crème de la crème of growth stocks with strong sales and earnings. If you’re interested, you can click here now to get started.
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Note: The Editor hereby discloses that as of the date of this email, the Editor, directly or indirectly, owned the following securities that are the subject of the commentary, analysis, opinions, advice, or recommendations in, or which are otherwise mentioned in, the essay set forth below:
BioNTech SE (BNTX)