Is Celgene All Good as a Long-Term Investment?

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Celgene Corporation (NASDAQ: CELG), a multinational biopharmaceutical company based in Summit, New Jersey, primarily produces drug treatments for cancer and inflammatory diseases, and takes part in the detection, advancement, and commercialization of therapies intended to provide a breakthrough in the field of medicine.  Since its establishment in 1986, the company has been investing in research and progress, as well as providing products such as Thalomid (thalidomide), Revlimid (lenalidomide), Vidaza (azacitidine), Alkeran (melphalan), and Focalin (dexmethylphenidate hydrochloride), amongst many others.

When Promising Stocks Arise

A number of market analysts and shareholders were impressed with the performance of stocks in the healthcare sector in 2012.  This year, the company’s shares are likely to encounter several stresses from the currently recuperating global economy, primarily due to the fact that most companies have experienced numerous patent cliffs, and revenues have been varying from a reasonable to extreme rate.

Celgene maximized the affirmative forecast and analyst upgrades on Jan. 7, and it efficiently attained $91.40 early this week, which is somewhat higher than the stock’s five-year peak.  Of specific significance to the company’s eventual success and stock assessment are the potential hits that the pharmaceutical company has in store for the market.  One notable drug in the company’s pipeline is Abraxane, a cancer drug that is expected to receive approval and support from the Food and Drug Administration as a treatment for pancreatic cancer.

Conversely, shares of Acadia Healthcare (NASDAQ: ACHC), a healthcare provider, experienced stable increases a number of times in 2012, and its current rate costs $24.94.  The stock has progressed on top of its 20-day, 50-day, and 100-day average by a minor percentage.  Its stocks were held up over 3% on Tuesday subsequent to publicizing that it had obtained Greenleaf Center, a 50-bed inpatient psychiatric site in Georgia.

The shares of The Medicines Company (NASDAQ: MDCO) may currently be at a rate of 15% short of its all-time peak, but its stock is positive in accordance with its 20-day, 50-day, and 100-day average.  Moreover, the company’s shares moved closer to these means after increasing over 13% on Tuesday, which gives it its six-year peak. Competition may be a bit stiff for Celgene, but this only means that the medical industry is experiencing a hype that should be looked at a positive note for the many businesses involved.

Great Expectations

Recently, Celgene has released an encouraging forecast for 2013 which suggests that the company looks forward to revenues in of $5.50-5.60 for each share, which is 12%-14% higher than its expected profits of $4.90 for every share last year.  Furthermore, its net product returns for 2013 are expected to reach more or less $6 billion, which is 11.4% higher than that of the previous year. 

In fact, Celgene retains its visions even for the years to come.  It anticipates revenue for 2015 in the range of $8-$9 per share, while net product profits are estimated in the rate of $8-$9 billion.  The company also has a positive attitude for 2017, and it forecasts its net product earnings at $12 billion, while its adjusted revenue for every share is projected at $13-$14. Overall, it foresees great years ahead, which could be a great moral boost for investors.

Implications of the Trends

With Celgene’s extensive range of drugs and an excellent pipeline to introduce in the coming years, a good number of investors will consider this as a more promising means of participating in the biotech investing market. Although there may be risks involved in the many years ahead, these should not ruin Celgene’s position in the market as its performance shows that it's a safe and potentially valuable investment.


RhodoraDagatan has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. Is this post wrong? Click here. Think you can do better? Join us and write your own!

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