Biotech stocks are stocks in medical device and drug development companies. The biotech stock sector usually refers to stocks in smaller drugmakers, while pharma stocks refer to larger companies. Another difference is that biotech products are derived from organic material, while pharmaceuticals are chemically-based. Despite these differences, the terms are often used interchangeably.
Most of the biotechs on this watchlist are small drugmakers capable of giant price swings. That’s one of the things that makes this sector appeal to a certain kind of trader…
These stocks can have meteoric rises that are unheard of outside of the shady penny stock realm. Look at the run Moderna Inc. (NASDAQ: MRNA) had from February 2020 to August 2021.
It gained about 2,500% in that time. Not even Tesla Inc. (NASDAQ: TSLA) matched that!
That’s the upside of biotech stocks. But these stocks have many downsides as well…
Here’s a big one: they’re liable to dilute at the first chance.
That makes them dangerous, but also ideal for the nimble trader. If you want to learn the SteadyTrade Team approach for trading these stocks, read on …
Table of Contents
- 1 What Does a Biotech Company Do?
- 2 Biotech Stocks in 2022
- 3 5 Biotech Stocks to Watch in November 2022
- 4 Best Biotech Stocks for November 2022
- 5 See the Stocks I’m Watching
- 6 Conclusion
- 7 One Platform. One System. Every Tool
What Does a Biotech Company Do?
Biotech companies develop drugs, treatments, and vaccines for a range of health issues. These stocks soared after vaccine developments stole the spotlight in 2020 and 2021.
But it’s not all sunshine and roses for biotech stocks. Drugs and therapies take a lot of time and money to develop. And it can go down the drain if the FDA doesn’t approve.
We’ve seen a steep dropoff in biotech stocks since 2021 ended. The SPDR S&P Biotech ETF (NYSEARCA: XBI), which tracks the sector, lost more than 32% since the start of 2022. The SPDR S&P 500 ETF Trust (NYSEARCA: SPY), which tracks the S&P, lost about 25% in that time.
So what makes these stocks watch-worthy? Why do so many traders love to trade them?
The right news or catalyst can spark big, volatile runs. If you’re prepared, you can swoop in with a plan and take the meat of the move. But with volatility comes risk, so you must be ready for the action.
Biotech Stocks in 2022
Again, biotech stocks are volatile — making indexes like the XBI and iShares Biotechnology ETF (NASDAQ: IBB) pretty much useless to day traders.
5 Biotech Stocks to Watch in November 2022
My top 5 biotech stocks to watch for November 2022 are:
- Peak Bio Inc. (NASDAQ: PKBO)
- Virax Biolabs Group Ltd. (NASDAQ: VRAX)
- Veru Inc. (NASDAQ: VERU)
- Spero Therapeutics Inc. (NASDAQ: SPRO)
- Moderna Inc. (NASDAQ: MRNA)
What’s different about this list? There are more pandemic plays than we’ve seen in a while!
This doesn’t mean that vaccines are back to being big catalysts …
It just means that trigger-happy traders are out of other good options.
At the beginning of November, things are looking unpredictable. Proven tickers like VERU and MRNA look better when the market is chopping sideways, waiting for what comes next …
The Fed announced another BIG interest rate hike at the start of the month. This dashed traders’ hopes for a reversal of this economy-cooling policy.
November 8’s election has also got traders spooked.
If you’re part of the SteadyTrade Team, you probably aren’t too worried. You know to wait for one of your preferred setups BEFORE you trade …
Like I always say, even in bad markets there will be one trade that works …
And once all the market uncertainty is worked out, you’re ready to capitalize on the green wave I see coming!
That’s what trading is. Don’t burn yourself out on low-potential plays. Be safe, and wait for the truly Grade-A setups …
There’s no guarantee that any of my watchlist picks will be tradeable. But if something happens, smart traders should be ready.
Best Biotech Stocks for November 2022
These are the top 5 biotech stocks to watch in November 2022 …
No, that doesn’t mean that I’ll trade them. Learn the patterns that work best for you — you might see a chance to use them with these stocks!
#1: Peak Bio Inc. (NASDAQ: PKBO)
My first biotech stock pick is Peak Bio Inc. (NASDAQ: PKBO).
PKBO made my weekly watchlist at the start of November …
It’s a trashy biotech SPAC that squeezed in a Friday chat pump. There was also some decent news …
It traded 18 million shares on a 6 million float … That’s 3 float rotations. The demand sent it up over 150% before it pulled into the close.
The news gives PKBO “the right, without the obligation” to sell a California-based VC firm up to $100 million of its common stock over a period of 36 months. There’s no indication of the price they have “the right” to sell their stock at.
The last stock this particular VC gave a similar right to is the even sketchier biotech United Health Products, Inc. (OTCPK: UEEC).
Just one more eyebrow raiser — $100 million is about twice PKBO’s market cap. So either this deal will never happen or it will mean a heck of a lot of dilution.
If you’re trading PKBO the right way, you know that none of this matters. I’m looking for a break of $9.50 with risk in the low $9s.
#2: Virax Biolabs Group Ltd. (NASDAQ: VRAX)
My second biotech stock pick is Virax Biolabs Group Ltd. (NASDAQ: VRAX).
VRAX started out as a COVID testing provider. It saw the way the wind was blowing in August, and got into the monkeypox sector with a PCR test.
Now they’re multi-tasking with a 3-in-1 RSV-Influenza-COVID rapid test. This news briefly reversed the slump they’ve been in ever since August …
We developed a trading plan on the SteadyTrade Team’s morning webinar. But VRAX didn’t hit the entry of $2.73.
That’s OK, you know the golden rule of trashy biotechs …
If it dies, it dies.
That’s exactly what happened the next day. They immediately did an offering, and tanked their stock again.
That isn’t what I’m looking at. The volume that poured in with this catalyst made for their third day ever with 50 million shares traded!
One thing I know — they haven’t forgotten how to release exciting PR.
#3: Veru Inc. (NASDAQ: VERU)
My third biotech stock pick is Veru Inc. (NASDAQ: VERU).
VERU is one of our old favorites. As much as I like to bash COVID as a catalyst, these stocks have been moving.
It gained 45% on November 7 with a triple-threat of catalysts — FDA headlines, in a hot sector, and a former runner. But I’m looking at an even more important one …
The last time VERU traded 25 million shares, it kicked off a five-day run.
This time, we have some mixed messaging. But price always has the final word.
VERU’s November 7 news showed positive results in trials for its COVID-19 drug …
But FDA regulators flagged the small sample size and a high death rate in the placebo group, making a wider implementation hard to predict. These concerns had been raised before, and didn’t stop the rally.
VERU is applying for emergency-use authorization for its new drug. An FDA recommendation panel will give its opinion November 9. While the panel’s recommendations aren’t binding, they are usually followed by the FDA.
#4: Spero Therapeutics Inc. (NASDAQ: SPRO)
My fourth biotech stock pick is Spero Therapeutics Inc. (NASDAQ: SPRO).
Talking about former runners, I don’t forget a stock that trades 200 million shares in a day too soon …
That’s how the market reacted to SPRO’s partnership deal with GSK in September. It had a leg up from under $1 into the $2 range that day, and hasn’t come down since.
The news drawing volume in the past few days doesn’t compare. SPRO announced that it will have an earnings call on November 14, jolting the stock up 10% in premarket on November 8 …
It gave those gains back as the market opened.
Zacks predicts good earnings for that call. If market optimism returns, this might be a good catalyst.
#5: Moderna Inc. (NASDAQ: MRNA)
My fifth biotech stock pick is Moderna Inc. (NASDAQ: MRNA).
AKA — the sector leader of pandemic plays.
This isn’t just the least sketchy biotech out there …
This is also a stock that’s gained nearly 40% since October 20!
If you want to avoid the biggest mistake in biotech stocks, trading MRNA is a loophole.
MRNA is extremely unique in the world of biotechs. They invented a new kind of vaccine against the biggest health crisis in the last 100 years …
That means that even disappointing earnings can’t bring this stock down. It’s able to follow bad news with a catalyst that turns market sentiment around.
MRNA is still trending up on November 4 news of another Health Canada vaccine authorization. When you’re the sector leader, there’s always room to grow.
See the Stocks I’m Watching
This was just my list for biotechs in November. But every week I put together a list of the hottest stocks in the market.
And I include a detailed analysis of each pick. That way you can follow my thought process and learn to pick stocks yourself.
I’m not going to be around forever, so you better study up to be self-sufficient.
In the biotech sector, the right catalyst can supercharge stock runs. That’s great news for prepared traders. But you have to know what to watch … like trial results or FDA approvals.
Start your 2-week trial today of both today — only $17!
And remember, this is a list of stocks to watch — not trade recommendations. Always do your own research and make your own plans.
Biotech stocks can come with a lot of fun momentum, but you’ve gotta be ready for it. That all starts with your watchlist. Get crackin’!
What do you think of my November biotech list? Are we watching any of the same stocks? Let me know with a comment below!