5 Reasons to Pick Emergent as an Investment-Worthy Stock

Emergent BioSolutions, Inc. EBS offers specialized products to health care providers and governments to fulfill the unmet medical needs as well as combat emerging public health threats. BioThrax is the company's key Biodefense product and is the sole vaccine to be marketed for general use in case of both pre-exposure prophylaxis and post-exposure prophylaxis of anthrax disease.

Let’s find out if this Gaithersburg, MD-based company will be a good investment in 2018. Here are five reasons to pick the stock this year.

Bullish Rank and Solid VGM Score: Emergent has a Zacks Rank #1 (Strong Buy) and a favorable VGM Score of A. You can see the complete list of today’s Zacks #1 Rank stocks here.

Back-tested results show that only stocks with a VGM Style Score of A or B when combined with a Zacks Rank of 1 or 2 (Buy), offer the best upside potential.

Shares Trended Up in a Year: After a rather difficult 2016, share price of the company has picked up in 2017. Shares of Emergent have outperformed the industry in a year’s time. The stock has surged 44.4% compared with the industry’s increase of 2.1%. The stock has seen the Zacks Consensus Estimate for 2018 earnings per share being raised from $2.17 to $2.36 over the last 30 days.

 

Deals and Acquisitions to Support Growth: Emergent has also been active in pursuing deals and acquisitions to drive growth.In October, the company completed the buyout of Sanofi's SNY ACAM2000 (Smallpox Vaccine), the only smallpox vaccine approved by the FDA. The company plans to assume responsibility of supplying the product in the United States. Strategic National Stockpile is under a 10-year contract with the Centers for Disease Control and Prevention.

During the same month, the company completed another contract with GlaxoSmithKline plc GSK to acquire raxibacumab, a fully human monoclonal antibody approved by the FDA for treatment and prophylaxis of inhalational anthrax. These deals and takeovers expand the company’s portfolio of revenue-generating products and are in sync with the company’s strategy to meet customer’s requirements.

Fast Expanding Manufacturing Capacity: The company expands its manufacturing capacity for BioThrax. In early 2017, the company received an approval for large-scale manufacturing of BioThrax from the German health regulatory authority. The company expects regulatory approval for BioThrax manufacturing facility across five European countries as well as Canada in 2018.

Bullish Outlook for 2017: The company has been consistently raising its guidance taking into consideration the recent acquisitions and increased expectations for BioThrax sales.

Emergent Biosolutions, Inc. Price

Emergent Biosolutions, Inc. Price | Emergent Biosolutions, Inc. Quote

Key Pick

Another top-ranked stock in the health care sector is AcelRx Pharmaceuticals, Inc. ACRX carrying a Zacks Rank of 2.

AcelRx has seen the Zacks Consensus Estimate for current-year loss per share being narrowed from $1.03 to 99 cents for 2018 over the last 30 days.

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