- Over the last year, the biotechnology and pharmaceuticals index has been the second-worst performer in the FTSE350 Index.
- Healthcare stocks are a risky investment as these biotechnology firms work on breakthrough scientific research, which has a high probability of failure.
Since the Covid-19 pandemic crippled the world, people have hardly discussed anything else other than health. Most of the big pharma giants are now household names, especially those who are somehow related to Coronavirus treatment or testing. However, all were not that lucky, as over the last year, the biotechnology and pharmaceuticals index has been the second-worst performer in the FTSE350 Index.
One of the reasons for investors shunning this sector could be that the smaller healthcare stocks are a risky investment as these firms work on breakthrough scientific research, which has a high probability of failure.
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Here we will discuss four smaller healthcare stocks that have given a one-year return of over 50 per cent. A look at four such stocks:
Angle Plc (LON: AGL)
The stocks of the liquid biopsy company have given a 1-year return of 65.4 per cent. On 11 May, the company announced the results of a new research on triple negative patients having breast cancer. The study analysed circulating tumour cells (CTCs) harvested by the company’s Parsortix system, and it was discovered that it could help in monitoring cancer patients in real time and provide information of “druggable targets" that could be useful for next line therapy in case of a relapse.
The company reported a revenue of £0.8 million for the year ended 31 December 2020 compared to revenue of £0.6 million a year ago. The company reported a loss of £11.6 million, which takes into account planned investment, compared to a loss of £7.6 million a year ago. Its cash and cash equivalents and short-term deposits were at £28.6 million compared to £18.8 million a year ago.
The shares of the company were at GBX 110.58, down by 0.27 per cent on 12 May at 09:06 GMT+1.
Alexion Pharmaceuticals Plc (LON:0QZM)
The Massachusetts-based drug maker would be taken over by the pharma behemoth AstraZeneca PLC. The company said that the necessary approvals by the majority shareholders for the acquisition were given on Tuesday. The company said that it expects the takeover to be completed in the third quarter of 2021. The takeover was sealed at a deal of $39 billion in December.
The company had a one-year return of 71.94 per cent and closed at USD 119.37 on 11 May.
Renalytix AI Plc (LON: RENX)
The AI-enabled in vitro diagnostics firm has given a one-year return of 204.99 per cent. Last month, the company furthered its partnership with Joslin Diabetes Centre to integrate the new biomarkers created by its researchers for the treatment of kidney diseases into its KidneyIntelX platform.
For the second quarter of 2021, the company reported $0.4 million in revenue from pharmaceutical services. The operating expenses of the company were at $8.8 million compared to $2.7 million in the same period a year ago. Research and development expenses increased to $1.4 million from $1.1 million in 2019 to $2.5 million.
The shares of the company were trading at GBX 1,005, down by 0.99 per cent on 12 May at 09:05 GMT+1.
EKF Diagnostics Holdings Plc (LON: EKF)
The healthcare company’s revenue jumped 45 per cent to £65.3 million for the year ended 31 December 2020 compared to £44.9 million a year ago. Its gross profit was up 58 per cent to £37.4 million compared to £23.7 million a year ago. Its adjusted EBITDA was up 113 per cent to £25.5 million compared to £12 million a year ago.
The shares of the company have given a one-year return of 77.08 per cent and were trading at GBX 70.60, up by 3.82 per cent on 12 May at 09:18 GMT+1.