Investors are talking about the impact that artificial intelligence (AI) can have on their portfolios. But there's another sector offering a chance at life-changing returns. Gene editing technology is moving from hype to hope.
The seeds of gene editing technology were planted when the human genome was mapped out. Today, gene editing companies are beginning to use that knowledge to create treatments that can alter the base instructions received through DNA. This has profound implications for many illnesses and diseases with a root genetic cause. And many of the therapies being tested may be able to provide a solution with a single treatment.
What makes this sector even more appealing is that it may not only affect your financial well-being, but this technology could also save lives. However, like any sector, it's important to understand the risks involved.
In this special presentation, we're looking at seven gene editing stocks that appear to have the best chance to deliver treatments for transformational change.
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- CRISPR Therapeutics
- Intellia Therapeutics
- Caribou Biosciences
- Beam Therapeutics
- Cellectis
- bluebird bio
- Silence Therapeutics
#1 - CRISPR Therapeutics (NASDAQ:CRSP)
When you hear about gene editing, you’ll frequently hear about CRISPR-Cas9 technology. The visual picture of this technology is using a pair of scissors to splice out an offending gene.
CRISPR-Cas9 is the proprietary gene editing technology developed by CRISPR Therapeutics AG (NASDAQ: CRSP). And as one of the leading names in the sector, it should be one for investors to consider.
The company’s lead candidate, CASGEVY, received approval for the treatment of sickle cell disease from the U.S. Food & Drug Administration (FDA) in December 2023. In January 2024, the label for CASGEVY was expanded to include beta-thalassemia.
CRISPR is partnering with Vertex Pharmaceuticals Inc. (NASDAQ: VRTX) to market CASGEVY and the company will only receive 40% of the revenue Vertex generates from marketing the drug. The company also faces issues dealing with accessibility (there are only 25 treatment centers worldwide). And health insurers have yet to weigh in on how much of the drug’s $2.2 million price tag for one treatment they will cover.
Those are to be expected for a company that is first to market with a revolutionary treatment. But now that the company has opened the door, it may be time for investors to get involved.
About CRISPR Therapeutics
CRISPR Therapeutics is a gene-editing company focused on developing transformative gene-based medicines for serious diseases using its proprietary CRISPR/Cas9 platform. CRISPR/Cas9 is a revolutionary gene-editing technology that allows for precise, directed changes to genomic DNA. CRISPR Therapeutics has established a portfolio of therapeutic programs across a broad range of disease areas including hemoglobinopathies, oncology, regenerative medicine and rare diseases.
Read More - Current Price
- $47.74
- Consensus Rating
- Hold
- Ratings Breakdown
- 9 Buy Ratings, 8 Hold Ratings, 2 Sell Ratings.
- Consensus Price Target
- $75.63 (58.4% Upside)
#2 - Intellia Therapeutics (NASDAQ:NTLA)
It's appropriate to include Intellia Therapeutics Inc. (NASDAQ: NTLA) on a list of gene editing stocks. And it’s also important to include them immediately after CRISPR Therapeutics. Intellia uses CRISPR-Cas9 technology for its in vivo gene editing pipeline that is attempting to treat more conditions.
For example, the company’s lead candidate, NTLA-2001 is being developed as a potential treatment for Transthyretin Amyloidosis (ATTR). The company has reported clinical data supportive of its technology, but approval is still years away.
The good news for investors is that Intellia has partnered with Regeneron Pharmaceuticals inc. (NASDAQ: REGN) to bring NTLA-2001 to market. And there is some belief that NTLA-2001 may eventually be approved as a treatment for other genetic diseases such as Alzheimer’s Disease, Parkinson’s, and Huntington’s Disease.
The Intellia analyst forecast on MarketBeat gives NTLA stock a Moderate Buy rating with a $67.25 price target. That’s 215% above the stock’s closing price on August 7, 2024. And for those who place a value on such things, Cathie Wood’s ARK Invest fund increased its stake in the stock to 5.5% in the second quarter of 2024.
About Intellia Therapeutics
Intellia Therapeutics, Inc, a genome editing company, focuses on the development of curative therapeutics. The company's in vivo programs include NTLA-2001, which is in Phase 1 clinical trial for the treatment of transthyretin amyloidosis; NTLA-2002 for the treatment of hereditary angioedema; and NTLA-3001 for alpha-1 antitrypsin deficiency associated lung disease.
Read More - Current Price
- $21.51
- Consensus Rating
- Moderate Buy
- Ratings Breakdown
- 11 Buy Ratings, 4 Hold Ratings, 0 Sell Ratings.
- Consensus Price Target
- $61.77 (187.2% Upside)
#3 - Caribou Biosciences (NASDAQ:CRBU)
Caribou Biosciences Inc. (NASDAQ: CRBU) is working on what it describes as the next generation of CRISPR genome-editing technology. The company has created its proprietary chRDNA genome-editing technology that according to Caribou improves upon CRISPR technology by making more precise genome edits.
CRBU stock is down 70% in 2024, which is typical of a stock with just a $171 million market cap. However, the stock has rallied somewhat after an earnings report in which it beat revenue and earnings expectations. The company also has a cash foundation over $370 million which is expected to keep it funded through the first quarter of 2026.
Since the report, the Royal Bank of Canada (NYSE: RY) reiterated its Outperform rating on CRBU stock with a $14 price target. That tracks with overall analyst sentiment which has a Moderate Buy rating on the stock with a $15 price target.
About Caribou Biosciences
Caribou Biosciences, Inc, a clinical-stage biopharmaceutical company, engages in the development of genome-edited allogeneic cell therapies for the treatment of hematologic malignancies in the United States and internationally. Its lead product candidate is CB-010, an allogeneic anti-CD19 CAR-T cell therapy that is in phase 1 clinical trial to treat relapsed or refractory B cell non-Hodgkin lymphoma.
Read More - Current Price
- $2.03
- Consensus Rating
- Moderate Buy
- Ratings Breakdown
- 3 Buy Ratings, 1 Hold Ratings, 0 Sell Ratings.
- Consensus Price Target
- $11.25 (454.2% Upside)
#4 - Beam Therapeutics (NASDAQ:BEAM)
Beam Therapeutics Inc. (NASDAQ: BEAM) offers an approach to gene editing called base editing, which is is distinct from CRISPR-Cas9 technology in that it acts as a pencil and eraser that edits a genetic sequence.
Even with several candidates in late-stage trials it may be several years before treatments are commercially available. However, a partnership with Pfizer Inc. (NYSE: PFE) is a key reason that Beam has $1.2 billion in cash, which the company reports will keep it funded through 2027.
Since bankruptcy is always a concern with small biotech companies, knowing Beam has a cash stockpile can be a reason to get involved with the stock. Analysts have a consensus Hold rating on the stock with a $43.33 price target that would be a 76% upside from the stock’s closing price on August 7, 2024.
About Beam Therapeutics
Beam Therapeutics Inc, a biotechnology company, engages in the development of precision genetic medicines for patients suffering from serious diseases in the United States. It develops BEAM-101 for the treatment of sickle cell disease or beta-thalassemia; and BEAM-302, a liver-targeting LNP formulation to treat severe alpha-1 antitrypsin deficiency; BEAM-201, an anti-CD7 CAR-T product candidate, which is in Phase 1/2 clinical trials for the treatment of refractory T-cell acute lymphoblastic leukemia/T cell lymphoblastic lymphoma; and BEAM-301, a liver-targeting LNP formulation for the treatment of glycogen storage disease 1a.
Read More - Current Price
- $25.62
- Consensus Rating
- Hold
- Ratings Breakdown
- 6 Buy Ratings, 7 Hold Ratings, 0 Sell Ratings.
- Consensus Price Target
- $44.18 (72.5% Upside)
#5 - Cellectis (NASDAQ:CLLS)
Cellectis S.A. (NASDAQ: CLLS) is a clinical-stage gene editing company that is tightly focused on oncology treatments. The company's pipeline is based on its proprietary gene-editing technology named TALEN. The goal is to identify gene-edited T-cells that express chimeric antigen receptors to target and eradicate cancer cells.
Although CLLS stock is down 32% for the year, it’s up nearly 2% in the 30 days ending August 6, 2024. Much of that is due to two orphan drug designations from the FDA. The first came on July 25 for its UCART22 product candidate for Acute Lymphoblastic Leukemia (ALL) treatment. The second came on August 1, when it received the same approval for its CLLS52 candidate.
But investors need to remember that receiving orphan drug designation is not comparable with receiving approval. Nor does it mean that any of these drugs will make it through the process. That means profitability is years away. Nevertheless, the Cellectis analyst forecasts on MarketBeat give the stock a Buy rating with an $8 price target. That’s 288% higher than its price on August 6, 2024.
About Cellectis
Cellectis SA, a clinical stage biotechnological company, develops immuno-oncology products based on gene-edited T-cells that express chimeric antigen receptors to target and eradicate cancer cells. The company is developing UCART19, an allogeneic T-cell product candidate for the treatment of CD19-expressing hematologic malignancies, such as acute lymphoblastic leukemia; ALLO-501 and ALLO-501A to treat relapsed or refractory for non-hodgkin lymphoma (NHL); and ALLO-715 for the treatment of multiple myeloma.
Read More - Current Price
- $2.30
- Consensus Rating
- Buy
- Ratings Breakdown
- 2 Buy Ratings, 0 Hold Ratings, 0 Sell Ratings.
- Consensus Price Target
- $8.00 (247.8% Upside)
#6 - bluebird bio (NASDAQ:BLUE)
Gene editing stocks are about balancing risk and reward.
In December 2023, bluebird bio Inc. (NASDAQ: BLUE) became the second company to have a gene editing treatment approved by the FDA with LYFGENIA. LYFGENIA is for patients 12 years and older with sickle cell disease and a history of vaso-occlusive events. The treatment, along with the company’s other investigational candidates, combines gene addition with an autologous hematopoietic stem cell transplant (HSCT).
You would think this would have the company’s stock soaring. But BLUE stock is down 72% in the last 12 months and 29% in 2024, despite the FDA approval. And as of August 6, 2024 the stock is trading at a 52-week low near $1.
The question is why? The answer may simply be that bluebird bio is a tiny company with just a $102 million market capitalization. Small-cap stocks have lagged the market for several years and BLUE stock is being heavily shorted with a short interest ratio of over 28%.
About bluebird bio
bluebird bio, Inc, a biotechnology company, researches, develops, and commercializes gene therapies for severe genetic diseases. Its product candidates for severe genetic diseases include ZYNTEGLO (betibeglogene autotemcel) for the treatment of transfusion-dependent ß-thalassemia; lovotibeglogene autotemcel for the treatment of sickle cell disease (SCD); and SKYSONA (elivaldogene autotemcel) to treat cerebral adrenoleukodystrophy.
Read More - Current Price
- $0.58
- Consensus Rating
- Hold
- Ratings Breakdown
- 4 Buy Ratings, 7 Hold Ratings, 1 Sell Ratings.
- Consensus Price Target
- $4.74 (721.3% Upside)
#7 - Silence Therapeutics (NASDAQ:SLN)
Silence Therapeutics plc (NASDAQ: SLN) is another small-cap stock to consider in the gene editing sector. Like bluebird bio, SLN stock is down 21.45% in the last three months. However, it started from a stronger base and is still up 215% in the last 12 months.
With the company’s proprietary mRNAi GOLD platform, Silence Therapeutics is tackling gene editing through a process known as gene silencing. This is a way to use the body’s natural suppression of gene expression to treat diseases. Instead of introducing new genes into the body, it uses already-existing biological processes without permanently altering DNA. Silence’s pipeline includes two candidates in clinical trials and three that are in the pre-clinical stage.
SLN got a brief lift in June 2024 when it reported strong topline results for its lead candidate, Zerlasiran (SLN360), which is in Phase 2 clinical trials. However, the recent sell-off in the broader market has the stock almost where it began the year. Nevertheless, analysts give the stock a consensus Buy rating with a $61.50 price target, which would give investors a 265% upside.
About Silence Therapeutics
Silence Therapeutics plc, a biotechnology company, focuses on the discovery and development novel molecules incorporating short interfering ribonucleic acid (siRNA) to inhibit the expression of specific target genes in hematology, cardiovascular, and rare diseases. The company's mRNAi GalNAc Oligonucleotide Discovery platform consists of precision engineered product candidates designed to target specific disease-associated genes in the liver.
Read More - Current Price
- $18.23
- Consensus Rating
- Buy
- Ratings Breakdown
- 5 Buy Ratings, 0 Hold Ratings, 0 Sell Ratings.
- Consensus Price Target
- $57.20 (213.8% Upside)
Given the transformative potential of the technology, investing in gene editing stocks offers an opportunity for building generational wealth. However, it's important to understand the risks involved. Developing these therapies takes time. A single clinical trial stage can take between one and five years with many regulatory hurdles to clear.
It's also expensive. Many of these companies rely on partnerships with other companies to ensure they have enough cash on hand to get a treatment through clinical trials. It also means that many of these companies may fail.
And the handful of treatments that are commercially available are revealing a new concern. Health insurance companies are now deciding when - and at what price - to cover these treatments, which could have a profound impact on availability.
All of this means the payoff in gene editing stocks may still be years away. But investors with an appetite for speculative stocks with the potential for massive upside may want to start watching some of these companies. When you put your watchlist on MarketBeat, you'll get real-time updates on news that affects that stock.
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