Top 3 Biotech Holdings as Market Rewards Speculative Stock Picking
Market action remains strong with some significant pockets of speculative action.
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Market action remains strong on Tuesday morning with the Russell 2000 moving higher into new-high territory and some significant pockets of speculative action. It continues to be a great market environment for stock pickers focused on secondary stocks.
The Magnificent Seven MAGS is lagging with a pullback of 0.6% after leading on strength in Apple AAPL and Nvidia NVDA on Monday. I’m looking to add to my NVDA position as it pulls back. Key support is at the 50-day simple moving average at $176.25, but I’m not sure it will get there quickly.
The best action on my screens is biotechnology. This is my largest concentration, and it continues to look good. Unlike the technology sector, biotechnology has lagged badly for years, and it has a lot of ground to pick up.
My largest position currently is Harrow, Inc. (HROW), which has an Investor Day coming up this Friday. I believe strong guidance is likely. HROW is an eye care pharmaceutical company. It was founded in 2014 as an ophthalmic compounding pharmacy with no initial revenue. It has grown to dominate the ophthalmic compounding niche, holding approximately 35% market share. The company employs a distribution-focused business model to acquire and commercialize branded drugs, boasting an extremely strong pipeline.
My second largest position is BridgeBio Pharma (BBIO). BBIO is a commercial-stage biopharmaceutical company focused on genetic diseases and cancers with clear genetic drivers. A key product experiencing very strong sales is Attruby (acoramidis), an oral TTR stabilizer approved for ATTR-CM cardiomyopathy. UBS calls BBIO a "top pick" and has an $82 target. They are expecting three Phase 3 readouts in the next six months.
My third largest position is Xeris XERS, which was my top pick for 2025. I’ve discussed it many times and am quite pleased with its 125% gain this year. The stock is consolidating and has the potential for a positive response to third-quarter earnings when it updates its progress.
There are several other names on my radar on Tuesday, which I have discussed previously, such as Sound Hound AI SOUN, Ondas Holdings ONDS, Emergent BioSolutions EBS and Perpetua Resources PPTA.
It is a great market for stock pickers focused on smaller, more speculative names.
At the time of publication, DePorre was long HROW, BBIO, XERS, SOUN, ONDS, EBS, PPTA and NVDA.
