Beam Shares Have Tripled Since Early February

·3  min de lectura

- By Barry Cohen

If analysts are even close to being on target, it may be time for early investors to cash in on their shares of Beam Therapeutics Inc. (NASDAQ:BEAM). The stock of the Cambridge, Massachusetts-based biotechnology company closed at $67.68 Monday, up over 12% for the day and more than tripling since early February.

While the five analysts following the company still have it as a buy or strong buy, they assign the stock an average target price of $43. That's 35% below Monday's close, but keep in mind the experts have missed badly on the stock so far. In mid-May, I reported that analysts had set the target price of only about $31. At the time, Beam was trading at about $21.50, nearly $10 lower than it was selling at just days after its February initial public offering.

There doesn't appear to be any earth-shattering news to account for the stock's meteoric rise. Beam scientists continue to work on a novel approach to gene editing, hoping to use a chemical reaction to convert one of the four building blocks of a gene into a new, functioning one.

The company is applying its expertise to treat several diseases, including acute myeloid leukemia, sickle cell disease and vision loss caused by a form of macular degeneration. It is collaborating with privately-held Verve Therapeutics on a treatment for coronary artery disease.

In an early November news release, Beam called 2020 a year of significant progress.

"Since the start of the year, we've named three development candidates from our portfolio, now including BEAM-201, our multiplex editing program for the treatment of T-cell acute lymphoblastic leukemia," CEO John Evans said.

He added that in the second half of 2021, the company will ask the Food and Drug Administration for permission to begin human testing of its treatment for sickle cell disease.

Beam Shares Have Tripled Since Early February
Beam Shares Have Tripled Since Early February

Shares of Beam and Editas Medicine Inc. (NASDAQ:EDIT) both rose substantially in early August on rumors of a merger between the two. Stem Cell TV wrote that a link-up might make sense given the two companies already have an agreement to work together on genetic medicines, but nothing materialized. That was probably because Beam would be bringing a lot more to the table, with very little to gain.

FierceBiotech reported that more than half of the genetic errors associated with disease result from a single-letter change in the bases that form the human genome. Given that there are 33,000 point mutations identified as being tied to genetic diseases, the potential application of Beam's technology is massive.

Beam is one of several companies co-founded by gene-editing scientists David Liu and Feng Zhang, as well as Harvard Medical School professor J. Keith Joung.

Disclosure: The author has no position in any of the companies mentioned in this article.

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This article first appeared on GuruFocus.