PDS Biotechnology (PDSB) Stock Falls Off Its Highs, Buy at a Discount

Mohit Oberoi, CFA - Author

Jun. 8 2021, Published 8:56 a.m. ET

PDS Biotechnology (PDSB) stock fell over 26 percent on June 7 but was trading higher in pre-market on June 8. The stock has risen 339 percent YTD and 600 percent over the last year. With the stock now coming off its highs, should you buy the dip in PDSB stock?

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PDS Biotechnology is a clinical-stage biopharma company focusing on cancer immunotherapy based on the Versamune platform. The company was established in 2005 and is still in the pre-revenue stage, which means that it isn't making any revenues currently.

PDS Biotechnology to be added to Russell Microcap Index

PDS Biotechnology announced that it will be added to the Russell Microcap Index on June 28. Usually, the news of inclusion in an index triggers a buying spree in a stock. After a stock is included in the index, the ETFs tracking the index have to buy the stock in accordance with its weightage in the index.

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What happened to PDSB stock?

PDSB stock fell sharply on the news of its inclusion on the index. However, the stock was trading higher in pre-market on June 8 after it released the interim data from the Phase 2 trial led by the National Cancer Institute. Markets reacted positively to the trial results.

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“The achievement of a 67% tumor reduction among all HPV16-positive cancer patients including both CPI naïve and CPI refractory patients continues to strengthen the evidence supporting continuing clinical investigation of novel Versamune® platform’s potential ability to induce high levels of tumor-specific CD8+ killer T-cells,” said Dr. Lauren Wood, PDS Biotech Chief Medical Officer.

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PDSB stock valuation

Since PDS Biotechnology isn't making any revenues or earnings currently, we can't value it based on traditional metrics. However, the company’s market capitalization is only about $210 million, which could increase multifold if its product can be commercialized.

PDS Biotechnology stock forecast

According to the estimates compiled by MarketBeat, five analysts are covering PDS Biotechnology stock and all of them have a buy or equivalent rating. The stock’s consensus target price of $10.22 is a premium of 8.7 percent over its closing prices on June 7.

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Earlier in June, H.C. Wainwright raised its target price on PDSB stock from $8 to a street high of $20. The brokerage has been bullish on PDSB stock for quite some time and the stock hasn’t disappointed over the last year. In May, Chardan Capital had also raised PDSB stock’s target price from $10 to $11.

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PDSB stock on Reddit

PDS Biotechnology stock isn't very popular on Reddit groups. Meanwhile, BlackBerry, Clover Health, and AMC Entertainment are currently hot discussion topics on Reddit group WallStreetBets. The group has been successful in triggering a massive short squeeze in AMC Entertainment stock.

pds biotechnology pdsb stock price
Source: TIKR

PDSB stock versus 50-day SMA

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Should you buy PDS Biotechnology stock?

Like all clinical-stage biotech companies, PDS Biotechnology is a risky bet. The company is focusing on the fast-growing cancer care industry. If the company is successful with its endeavors, it could be a long-term winner. Things are moving in the right direction, which is exemplified by the trial results released on June 8.

Inclusion in the Russel Microcap index will also help bring credibility to the stock. The iShares Russell Microcap ETF tracks the index and has assets of over $1.4 billion.


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