Successful investors frequently look for the next big thing. For many investors in 2023 that means looking at electric vehicle or clean energy stocks. Those are probably good bets if investors are looking for outsize gains in the next decade. Another option for investors looking for market-beating performance in the next 10 years is gene editing stocks.
The field of gene editing took off in earnest with the human genome project in the late 1990s. Scientists announced that work completed in 2022.
The next step is what to do with the information we have. The benefit of mapping the human genome is that as scientists understand how genes work, it will be easier to use technology to create cures that can deal with underlying problems created by problematic genes.
This means we may be years away from having treatments for diseases like cancer, diabetes, and Alzheimer's disease that today we can only dream of. The stocks of the companies that create these treatments are likely to soar. And that's why now is an ideal time for risk-tolerant investors to have these stocks in their portfolio or at least on their watchlist.
Quick Links
- CRSPR Therapeutics
- Editas Medicine
- Intellia Therapeutics
- Beam Therapeutics
- Apellis Pharmaceuticals
- Caribou Biosciences
- Poseida Therapeutics Inc.
#1 - CRSPR Therapeutics (NASDAQ:CRSP)
If you’re at all familiar with the field of gene editing, then you’ve probably heard of CRSPR Therapeutics (NASDAQ: CRSP). The company is the founder of the CRISPR/Cas9 gene editing platform. The CRISPR/Cas9 platform is being used for projects in the company’s own pipeline.
And CRSPR isn’t shy about forming its own partnerships like the one it has with Vertex Pharamaceuticals (NASDAQ: VRTX). The two companies are working together to bring CRSPR’s CTX110 candidate to market. This one-time treatment for sickle cell disease and beta-thalassemia has a large addressable opportunity.
That opportunity means the reward outweighs the risk. CRSPR Therapeutics is not yet profitable and will not be for some time. But in this sector, if you wait to invest until a treatment is commercially available, you’ll have missed the largest gains. That's why this mid-cap stock enjoys 71% institutional ownership and has a moderate buy rating from the analysts surveyed by MarketBeat.
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
- $47.26
- Consensus Rating
- Hold
- Ratings Breakdown
- 9 Buy Ratings, 8 Hold Ratings, 2 Sell Ratings.
- Consensus Price Target
- $74.94 (58.6% Upside)
#2 - Editas Medicine (NASDAQ:EDIT)
The next company on this list of gene therapy stock is Editas Medicine (NASDAQ: EDIT). The company is working on its own gene editing platform based on CRISPR technology. This is where things can get a little confusing. Many companies will use CRISPR technology, but they are not affiliated with CRSPR Therapeutics or its gene editing platform.
That’s the case with Editas which has its own pipeline of candidates that is based on CRISPR technology. And the company has its own partnerships in particular with Allergan (NYSE: AGN).
EDIT stock currently has a consensus rating of Hold from the analysts surveyed by MarketBeat. One reason for that may be the level of short interest in the small-cap stock which is more than 30% as of this writing. This isn’t unusual for companies in this space, especially before they have a therapy approved.
About Editas Medicine
Editas Medicine, Inc, a clinical stage genome editing company, focuses on developing transformative genomic medicines to treat a range of serious diseases. It develops a proprietary gene editing platform based on CRISPR technology. The company develops EDIT-101, which is in Phase 1/2 BRILLIANCE trial for Leber Congenital Amaurosis; and reni-cel, a clinical development gene-edited medicine to treat sickle cell disease and transfusion-dependent beta-thalassemia.
Read More - Current Price
- $2.41
- Consensus Rating
- Moderate Buy
- Ratings Breakdown
- 7 Buy Ratings, 6 Hold Ratings, 0 Sell Ratings.
- Consensus Price Target
- $9.08 (276.9% Upside)
#3 - Intellia Therapeutics (NASDAQ:NTLA)
Intellia Therapeutics (NASDAQ: NTLA) is another gene editing company that is using their own version of a CRSPR/Cas9 platform. In this case the company has several candidates in its pipeline. Two of its candidates, NTLA-2001 and NTLA-2002 delivered encouraging phase-one trial results in 2022.
NTLA-2001 is being developed to treat transthyretin (ATTR) amyloidosis. This is a progressive genetic condition for which there is no treatment aside from those to manage symptoms. Intellia is partnering with Regeneron Pharmaceuticals, Inc. (NASDAQ: REGN) to bring NTLA-2001 through clinical trials.
NTLA stock is down over 53% in the last 12 months and the stock dropped approximately 20% in December 2022 after announcing a public stock offering. However, with the stock up over 17% in 2023, investors may believe the company has enough cash to get its candidates through the clinical trial stage without raising more capital in a rising interest rate environment.
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
- $13.12
- Consensus Rating
- Moderate Buy
- Ratings Breakdown
- 12 Buy Ratings, 6 Hold Ratings, 0 Sell Ratings.
- Consensus Price Target
- $54.94 (318.7% Upside)
#4 - Beam Therapeutics (NASDAQ:BEAM)
To this point, we’ve put the focus on companies that are using some form of CRISPR/Cas9 technology. Beam Therapeutics, Inc. (NASDAQ: BEAM) takes a different approach to gene editing. Specifically, Beam is engaged in base editing.
In the human genome, there are four types of bases found in DNA that form the “letters” that make up our genetic code. A “point mutation” occurs when these base pairs are “misspelled.” Point mutations are frequently a marker for the disease. Beam Therapeutics is attempting to use a “molecular pencil” to erase and rewrite these point mutations as opposed to splicing it out.
The company’s lead candidate, BEAM-101 is being developed to treat sickle cell disease and beta-thalassemia and is in ealry clinical trials. That means it will likely still be years before investors can plan on meaningful revenue and earnings.
BEAM stock has a Moderate Buy rating from the analysts surveyed by MarketBeat and has 76% institutional ownership.
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
- $24.49
- Consensus Rating
- Moderate Buy
- Ratings Breakdown
- 8 Buy Ratings, 4 Hold Ratings, 0 Sell Ratings.
- Consensus Price Target
- $44.91 (83.4% Upside)
#5 - Apellis Pharmaceuticals (NASDAQ:APLS)
Apellis Pharmaceuticals, Inc. (NASDAQ: APLS) is a mid-cap company that is flying under the radar of many investors in this space. Apellis focuses on C3, the central protein of the complement cascade. The complement cascade is the part of the body’s immune system that fights off infection. When this is overactivated, it can attach and destroy healthy cells which can lead to a number of diseases.
In July 2021, Apellis announced a collaboration with Beam Therapeutics to leverage that company’s base editing technology in an effort to develop new precision therapies for the eye, liver, and brain.
However, Apellis has a robust stand-alone pipeline including several that are in late-stage trials. It has to be stated that the company is still not profitable and is not likely to be anytime soon. But Apellis does enjoy significant institutional ownership of over 80% and is currently trading 30% below its consensus price target of over $70 per share.
About Apellis Pharmaceuticals
Apellis Pharmaceuticals, Inc, a commercial-stage biopharmaceutical company, focuses on the discovery, development, and commercialization of therapeutic compounds through the inhibition of the complement system for autoimmune and inflammatory diseases. It offers EMPAVELI for the treatment of paroxysmal nocturnal hemoglobinuria, C3 glomerulopathy and immune complex membranoproliferative glomerulonephritis, and hematopoietic stem cell transplantation-associated thrombotic microangiopathy; and SYFOVRE for treating geographic atrophy secondary to age-related macular degeneration and geographic atrophy (GA).
Read More - Current Price
- $27.49
- Consensus Rating
- Moderate Buy
- Ratings Breakdown
- 13 Buy Ratings, 6 Hold Ratings, 0 Sell Ratings.
- Consensus Price Target
- $51.06 (85.7% Upside)
#6 - Caribou Biosciences (NASDAQ:CRBU)
Finding a cure for cancer remains elusive despite the progress made. I’ve included Caribou Biosciences, Inc. (NASDAQ: CRBU) on this list because they are laser-focused on finding cancer treatments. Caribou focuses on chimeric antigen receptor T cell therapy (CAR-T).
In CAR-T cell therapy, engineered molecules called chimeric antigen receptors (CARs) identify and destory antigens found in lymphoma cells. The company has candidates to treat blood cancer in stage 1 trials. And the company is also working on getting candidates to treat solid tumors into clinical trials.
The company is also partnering with AbbVie Inc. (NYSE: ABBV) to develop additional CAR-T cell therapies that can be enhanced with CRISPR gene editing technology.
However, as an illustration of how volatile these stocks can be, Caribou posted positive results in its Stage 1 trial but CRBU stock still dropped. Still, Caribou receives a Buy rating from the analysts surveyed by MarketBeat with a price target that is 265% above its current level.
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
- $1.96
- Consensus Rating
- Buy
- Ratings Breakdown
- 3 Buy Ratings, 0 Hold Ratings, 0 Sell Ratings.
- Consensus Price Target
- $11.25 (474.0% Upside)
#7 - Poseida Therapeutics Inc. (NASDAQ:PSTX)
The last gene editing stock on this list is another small-cap play. Poseida Therapeutics Inc. (NASDAQ: PSTX). Like Caribou Biosciences, Poseida focuses on using CAR-T technology to find a treatment for cancer. However, whereas Caribou is in clinical trials with treatments for forms of blood cancer, Poseida is addressing solid cell tumors.
Unlike many of the stocks on this list, 2022 was a great year for PSTX stock. The stock is up 88% in the last 12 months and 27% in 2023. And analysts surveyed by MarketBeat give the stock a 99% upside.
That being said, the company is years away from having a commercially available product and short interest in PSTX stock rose sharply in January 2023. Still, for investors who have a risk appetite for clinical-stage trial companies, Poseida is one for the watchlist.
About Poseida Therapeutics
Poseida Therapeutics, Inc, a clinical-stage biopharmaceutical company, focuses on developing therapeutics for patients with high unmet medical needs. The company's development candidates for Heme Malignancies includes P-BCMA-ALLO1, which is in Phase I trial to treat patients with relapsed/refractory multiple myeloma; P-CD19CD20-ALLO1, which is in Phase I trial for treating B cell malignancies and other autoimmune diseases; P-BCMACD19-ALLO1, an allogeneic, off-the-shelf CAR-T product candidate in preclinical development for treating multiple myeloma; and P-CD70-ALLO1 under preclinical development to treat hematological indications.
Read More - Current Price
- $2.72
- Consensus Rating
- Buy
- Ratings Breakdown
- 2 Buy Ratings, 0 Hold Ratings, 0 Sell Ratings.
- Consensus Price Target
- $15.00 (451.5% Upside)
If you're like many investors, you may understand the benefit of gene editing, but may not be sure how to research the science behind these companies. One way around that is to invest in an exchange-traded fund (ETF) that provides exposure to gene editing companies.
Fans of Cathie Wood may want to look at the ARK Genomic Revolution ETF (NYSEARCA: ARKG). This fund includes at least two companies (CRSPR Therapeutics and Vertex Pharmaceuticals) that are listed in this presentation.
Two additional options for investors are the Global X Genomics & Biotechnology (NYSEARCA: GNOM) and the Invesco Dynamic Biotechnology & Genome ETF (NYSEARCA: PBE).
Whatever option you choose, you don't have to go it alone. MarketBeat provides an extensive library of tools that can help you research and keep track of all the stocks in your portfolio or on your watchlist. Many of these tools are free to any investor. And when you upgrade to a MarkeBeat All-Access membership, you'll enjoy a range of enhanced research tools including access to our stock screeners.
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