IBB Returns to Positive: How Did Its Holdings Perform?

The markets gained on May 1, 2016. The Dow Jones Industrial Average gained ~0.7% but still closed below 18,000. The iShares NASDAQ Biotechnology ETF (IBB) followed the market trend and gained 1.1% after a five-day losing streak, a positive beginning for May. IBB gained 2.7% during April. IBB outperformed the SPDR S&P 500 ETF (SPY), which rose by 0.8% on May 2, 2016.

The above chart gives information about the prices, returns at various intervals, 12-month target prices, and moving average prices of IBB, SPY, and a few holdings of IBB. The iShares NASDAQ Biotechnology ETF (IBB) closed at $270.94 and was trading below its 20-day moving average. Year-to-date, IBB is down by 19.9%. Approximately 1.9 million shares were traded, against the three-month average trading volume of ~2.4 million shares per day.

Sarepta Therapeutics (SRPT), NewLink Genetics (NLNK), and MannKind (MNKD) were the top gainers on May 2, 2016, with returns of 26.3%, 8.7%, and 7.4%, respectively. Sarepta Therapeutics moved up as the stock was upgraded to “outperform” by Oppenheimer, raising the target price of the stock to $60. This represents an upside of more than 322%. Last week, the FDA rejected eteplirsen for the treatment of Duchenne’s muscular dystrophy.

Sarepta Therapeutics closed at $17.92 and was trading below the 20-day moving average price. Year-to-date, the stock is down by 53.6%. Though Oppenheimer raised the target, the median analyst estimated target price is $10. Four analysts have recommended to “buy,” five analysts have recommended to “hold,” and five analysts have recommended to “sell.” Sarepta has a book value of $4.17 per share. With its current price, the stock is trading at a price-to-book value of 4.3x. Sarepta has a weight of ~0.1% in IBB’s portfolio.