Days after Hillary Clinton’s 91-character tweet dismantled the biotech rally over price-gouging concern; the smart money is pushing back into the sector, as many names begin to find solid support.
As we mentioned here:
Even if Hillary won the election, it would take years for pricing changes and regulation to kick in. The value of that uncertainty is relatively low, creating quite a significant buy opportunity.
Pricing concerns aren’t new – they’re likely to make headlines for years to come. We must also consider that Clinton’s proposal is likely to include older policies that failed in the past. And we must consider the multi-year catalysts, as well.
More than 80 million baby boomers retiring over the next 20 years will fuel much of the boom. New healthcare laws, new drugs, new treatments and new coverage for 32 million Americans that didn’t have prior insurance make biotech attractive. Biotech has thrived after negative press before. I expect it to be no different this time.
With that knowledge, we’ve watched the IBB – for instance – bounce well off oversold lows of $290 to more than $309. With 80 million baby boomers, 32 million newly insured Americans and rampant advancements in drugs and technology, sector upside is unlimited.
The smart money is pushing back into biotech. Shouldn’t you?