My Top Pick for 2025 Delivers the Goods
This low-priced biotechnology company posted a blow-out earnings report; also, my small caps are moving.
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The market is off to a positive start on Thursday morning as Apple AAPL drives the Magnificent Seven MAGS to another strong move. Breadth is approaching three-to-one positive, and there is a long list of big moves in smaller stocks as small-cap earnings are rolling in.
I’m focusing on some big moves in various small caps I follow, such as Nebius Group (NBIS), Emergent BioSolutions EBS, ADMA Biologics ADMA, and Delcath Systems DCTH. I’m actively trading these names, but am particularly pleased with the action in Xeris Biopharma XERS, which was my top pick for 2025.
XERS is hitting new multi-year highs this morning following a very strong earnings report. Revenue jumped 49% year-over-year to a record high, beat earnings per share estimates, and raised guidance. This news pushed the stock out of a trading range, and it should now start to appear on the radar of momentum traders who look for strong growth as well as relative strength. The stock is still a good value, and I will continue to look for opportunities to accumulate more.
Xeris is particularly interesting now as it transforms from a speculative penny stock to a momentum play driven by strong fundamentals. There is a whole new category of buyers now, which should help keep it moving as it delivers positive results.
The great thing about small-cap earnings is that they help to create a new shopping list. I’m particularly intrigued by Delcath Systems DCTH, which offers a unique cancer treatment. The company had a very good report, but there is some pricing pressure on its very high-margin drugs due to changes in Medicare. I believe the company will more than make up for the pressure on margins with increased sales.
There is some selling into strength in the indices this morning, but this is a stock pickers environment right now with all the small-cap earnings news that is hitting.
At the time of publication, DePorre was long NBIS, EBS, ADMA, DCTH, and XERS.
