Our Stock of the Week is Emergent BioSolutions (EBS). EBS is a turnaround biotechnology company that is becoming strongly profitable, although its key product lost its patent. EBS is now selling Narcan, a drug for heroin, fentanyl, and opium overdoses, over the counter without a prescription.
EBS also develops drugs and vaccines for public emergencies such as anthrax, typhoid fever, Ebola, botulism, monkeypox, and smallpox. It also has a skin decontamination kit that removes chemical warfare agents from the skin. Its customer base is both governments and consumers.
The company brought in turnaround expert Joseph Papa in February 2024. He closed several facilities, settled a lawsuit, refinanced debt, and streamlined operations. As a result, the company went from a large loss to a profit of $1.37 in the third quarter and is currently predicted to earn $2.07 in 2025, which is a forward PE of just 5x.
Technically, the stock is testing overhead resistance at around $11.75. It is a ‘go-to’ name for any public health emergency because of its ability to quickly develop vaccines and treatments.
As always, we will not chase the stock on Monday morning but will look to aggressively trade it as the chart develops.
This post is for educational purposes only! This is not advice or a recommendation. We do not give investment advice. Do not act on this post. Do not buy, sell, or trade the stocks mentioned herein. We WILL actively trade this stock differently than discussed herein. We will sell into strength and buy or sell anytime for any reason. We will actively trade into any unusual activity. At the time of this post, principals, employees, and affiliates of Shark Investing, Inc. and/or principals, clients, employees, and affiliates of Hammerhead Financial Strategies, LLC, directly or indirectly, controlled investment and/or trading accounts containing positions in EBS. To accommodate the objectives of these investing and/or trading accounts, the trading in these shares will be contrary to and/or inconsistent with the information contained in this posting.
