The flu epidemic currently sweeping the U.S. will only get worse, if recent headlines from the news media are right. As this story develops it should create speculation in flu vaccine stocks. For traders there is always an angle on playing such media hype, real or not, and this time should be no different. In recent years we have faced bird flu, swine flu, and all types of differing seasonal flus, and each time the small-cap flu vaccine stocks have had price pops. No matter the strain or name given to the flu, there is always a basket of stocks with vaccines that perform. Let' go over some possible candidates. The following stocks have vaccines that are currently undergoing trials for flu and should warrant your attention.
Novavax, Inc. (NVAX) is developing vaccine product candidate to protect against various circulating strains of pandemic influenza, including H1N1 and H5N1 influenza, as well as seasonal flu and respiratory syncytial virus (RSV). As you can see from its website, Novavax is heavily involved in the flu market and is an obvious candidate for a spike in buying interest in times such as now. The company has 11 ongoing flu trials. Novavax is breaking out from resistance today at $2.07 and could see a move to $2.44 in the near term. Next resistance on its chart is the $2.60 to $3 area.
iBio, Inc. (IBIO) is the most intriguing of the speculative flu plays as most traders seem unaware of its role in the flu market. Last July, iBio signed a global partnership with GE Healthcare. The companies formed a new global alliance to commercialize plant-based technologies for biopharmaceutical and vaccine manufacturing. In work funded by the Bill & Melinda Gates Foundation, iBio's pioneering plant-based technology has been used to produce an avian influenza vaccine candidate that recently completed a successful Phase I clinical trial. The iBioLaunch platform was also used to produce a candidate vaccine against H1N1 influenza, for which a human Phase I trial was successfully completed in March 2012. Speed to create vaccines is what is often needed, and that is what ibio does. The company has a downtrend breakout at $0.65 and could quickly see a move to the $1 area if the flu speculation continues to build. News out today that the flu vaccine is in short supply already plays into iBio's strengths, and is another strong reason for considering it now.
BioCryst Pharmacueticals, Inc. (BCRX) is always mentioned when there is a flu epidemic. The stock has been moving higher on this speculation over the last few days, despite the fact that in November it terminated its flu trial for "futility." The results are being analyzed now, and there could still be hope for the drug. The stock is breaking out from a resistance channel at $1.75 and has no real chart resistance until $2.
Last, we have Inovio Pharmacueticals, Inc. (INO). We discussed the prospects of the company in our article "Why Is It Reasonable For Inovio To Be $2," highlighting that among its many drugs are three trials for influenza in Phase 1 trials. Inovio has started off 2013 with a nice 25% move higher and is currently consolidating. Breakout here is $0.70.
This small basket of speculative flu stocks should give traders and investors a nice starting point for possible momentum in the coming days. There are a handful of other companies that focus on flu vaccines, but we have singled out these four as they appear to offer the best return potential. The flu story is starting to get more and more media attention, and that usually translates into stock price movement. Novavax and BioCryst have already begun their moves. iBio and Inovio should start their moves with them very soon.
Disclosure: I am long IBIO.