The world is trying to control the Coronavirus pandemic through quarantine and selective isolation. Is the potential vaccine generating excessive speculation in the pharmaceutical sector?
The pharmaceutical sector is one of the sectors that moves the most money around the world, especially in times of turbulence such as the current pandemic.
Are we currently engaged in wild speculation in the pharmaceutical sector? We will reflect on that question in today’s post.
Does Wall Street hate Bitcoin?
Wall Street is betting on a vaccine against the Coronavirus
Wall Street analysts are betting heavily on pharmaceutical companies that are among the first in the race to develop a coronavirus vaccine. And as companies have begun to reopen, it’s resulting in an increase in new cases of coronavirus, so the need for a vaccine is at an all-time high.
Naturally, pharmaceutical stocks have been on fire in recent months. From gene testing to the use of AI to accelerate drug development, all have helped pharmaceutical stocks climb north. But more importantly, the COVID-19 pandemic has illuminated the future of pharmaceutical players.
The iShares Nasdaq Biotechnology ETF (IBB) has risen more than 15% so far this year, after soaring 26% in the second quarter. Another ETF tracking the healthcare sector, the SPDR S&P Biotech ETF (XBI), rose an astonishing 44.6% in the second quarter to reach a record high in June. And that is just the beginning!
Moderna Inc.’s stock flies
After all, the shares of some of the major players in biotechnology have been rising lately. Moderna, Inc. shares rose to an all-time high of $81, once its COVID-19 vaccine showed a strong immune response.
Moderna’s shares have shot up a whopping 280% so far this year and its expected earnings growth for the next five-year period is 33.6%, compared to the projected profitability of the Medical-Biomedical and Bitcoin Evolution industry of 16.3%.
Once again, the only ones who will make money from the terrible pandemic we are going through is the pharmaceutical sector. It is worth clarifying that the development of the vaccine is more than necessary for everything to return to normal as soon as possible, but the big question arises: Is the wild speculation on Wall Street correct?
Seen from another perspective, is it possible to avoid speculation in the sector? Let us know what you think of the comment box.
I’ll say goodbye until tomorrow with this line from Josh Billings:
„Health is like money, we never have a real idea of its value until we lose it.“