We recently compiled a list of the 9 Best Gene Therapy Stocks to Buy Now and in this article, we discuss whether Intellia Therapeutics, Inc. (NASDAQ:NTLA) is the most promising gene therapy stock to buy now.
Gene therapy involves treating illnesses by modifying, replacing, or supplementing faulty or missing genes responsible for a disease. This approach has become a research focus area in fighting degenerative illnesses. The growing incidence of cancer and other chronic diseases worldwide is increasing the demand for gene therapy.
In 2023, the global gene therapy market reached a valuation of $7.74 billion. The market is expected to expand at a compound annual growth rate (CAGR) of 19.6% to reach a value of $38.76 billion by 2032. In 2022, North America led the global gene therapy market in terms of revenue and is expected to maintain this dominance throughout the forecast period. This leadership can be credited to the strong regulatory framework for developing cellular treatments and the presence of many biopharmaceutical companies in the region.
Meanwhile, Europe is expected to offer the most opportunities for growth in the gene therapy market in the coming years. Some factors driving this growth include advanced healthcare infrastructure and the availability of reimbursements across the continent.
As far as the vector types are concerned, the viral vector segment dominated the market in 2022 by capturing over 85% of the revenue share. This was due to advancements in physiochemical methods for gene therapies during preclinical and clinical trials aimed at treating various diseases. As these developments continue, the viral vector segment is projected to experience rapid growth in the following years.
Cathie Wood’s Confidence in Gene Therapy
The gene editing market has now gained mainstream attention and is attracting many famous investors. A prominent hedge fund investor, Cathie Wood, has shown strong confidence in this industry. Wood has been actively investing in innovative gene editing companies for many years.
Investors are becoming increasingly familiar with the term “CRISPR” – Clustered Regularly Interspaced Short Palindromic Repeats – as the industry sees an increase in companies using CRISPR-based technologies. According to a report by Cathie Wood’s ARK Invest, CRISPR can be considered the “breakthrough of the century.”
ARK Invest expects that CRISPR technology will soon show its potential in the agriculture sector and offer opportunities to improve the food supply. Meanwhile, in the field of medicine, CRISPR technology’s potential market for treating monogenic diseases is estimated at over $75 billion annually.
A scientist in the lab working on the cell and gene therapy research.
Our Methodology
To shortlist the best gene therapy stocks, we analyzed Insider Monkey’s database of 919 hedge funds as of Q1 2024. From this extensive dataset, we selected gene therapy companies that received significant interest from hedge fund investors. Our aim was to identify gene therapy stocks that hedge funds are particularly optimistic about. Furthermore, we looked at companies with strong product pipelines, positive analyst ratings, and high price targets to shortlist the most promising gene therapy stocks. The best gene therapy stocks have been ranked in ascending order of the number of hedge fund investors as of the first quarter of 2024.
“Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).”
Is Intellia Therapeutics, Inc. (NASDAQ:NTLA) the Most Promising Gene Therapy Stock to Buy Now?
Intellia Therapeutics, Inc. (NASDAQ:NTLA)
Number of Hedge Fund Holders: 29
Intellia Therapeutics, Inc. (NASDAQ:NTLA) is a clinical-stage biotechnology firm based in the United States. The company specializes in the development of innovative therapeutic solutions that use CRISPR-based technologies.
The company’s first program using CRISPR-based gene insertion, NTLA-3001, is forecasted to start human clinical trials this year. NTLA-3001 shows promise in restoring normal alpha-1 levels with just one treatment for patients with alpha-1 antitrypsin deficiency.
Moreover, Intellia Therapeutics, Inc. (NASDAQ:NTLA) plans to start patient dosing for a second clinical program too, this year. This program will focus on hemophilia B and use the company’s modular gene insertion platform in collaboration with Regeneron.
In its Q1 2024 earnings call, Intellia Therapeutics, Inc. (NASDAQ:NTLA) reported cash equivalent and marketable securities of $953.4 million. Meanwhile, the company’s collaboration revenue was recorded at $28.9 million during Q1, up from $12.6 million in the same period last year.
Overall, analysts are bullish on Intellia Therapeutics, Inc. (NASDAQ:NTLA) and think that the stock price could increase by over 150% this year. The bullish outlook is primarily being driven by the company’s two key expected phase 3 clinical trials this year. Intellia Therapeutics, Inc. (NASDAQ:NTLA) is being considered as one of the best gene editing companies.
As of Q1 2024, 29 hedge funds reported owning a stake in Intellia Therapeutics, Inc. (NASDAQ:NTLA), up from 28 in the previous quarter. ARK Investment Management is the leading hedge fund investor in the company, with a stake of over $302 million.
Overall, Intellia Therapeutics, Inc. (NASDAQ:NTLA) ranks 9th among the 9 best gene therapy stocks to buy now. You can visit 9 Best Gene Therapy Stocks to Buy Now to see the other gene therapy companies that are on the hedge fund radar.
While we acknowledge the potential of gene editing companies, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure. None. This article is originally published on Insider Monkey.