Neurocrine Biosciences
Neurocrine Biosciences
NBIX
1.52% 24%- Shares are forming a flat base with a buy point of 109.36
- Stock held on to its 50-day line in down market last week
- Relative Strength Rating is 93 of 99; Composite Rating is 97
Industry Group Ranking
Emerging Pattern
Flat Base
One of three positive chart patterns to look for when doing technical analysis. It usually occurs after a stock has advanced off of a “cup with handle” or “double bottom” pattern. The “flat base” moves straight sideways in a fairly tight price range for at least five weeks and does not correct more than 15%.
Neurocrine Biosciences (NBIX) is the IBD Stock Of The Day as market uncertainty shakes plenty of leading equities — but not NBIX stock.
XAccording to FactSet, Neurocrine shares closed 4% off their 52-week high last week. Meanwhile, the sector — which includes biotech and pharmaceutical stocks — was more than 42% off its 52-week high. RBC Capital Markets analyst Brian Abrahams is watching a number of catalysts for Neurocrine.
The company makes a treatment for the movement disorder tardive dyskinesia called Ingrezza. In the second quarter, Ingrezza generated $350 million in net sales. This year, sales are expected to surge 28% to $1.45 billion. Still, analysts are watching for what's next from Neurocrine, which is testing an array of treatments for neurodegenerative diseases.
Schizophrenia treatment could be an interesting longer-term catalyst, says Abrahams. The company just unveiled its testing strategy for an experimental approach to the disease.
The results are still two years off, but "it will continue to be one of the key focus areas in Neurocrine's pipeline development to drive long-term growth and diversification beyond Ingrezza," Abrahams said in a report to clients.
NBIX Stock: Trailing In Schizophrenia
Abrahams has a sector perform rating on NBIX stock.
Neurocrine is coming from behind in schizophrenia. Karuna Therapeutics (KRTX) — another highly rated biotech stock — and Cerevel Therapeutics (CERE) are both ahead in testing schizophrenia treatments.
Neurocrine is running a midstage study of 213 patients testing four different doses. It will measure the change in symptoms after six weeks. Abrahams notes Neurocrine is targeting a different receptor tied to the disease from Karuna. This could lead to different side effects, he said.
"Whether this would lead to higher potency and perhaps a better therapeutic window is still to be determined," he said.
He has a 93 price target on NBIX stock. In afternoon trades on today's stock market, shares sank 1.5% to 101.93.
Neurocrine Outplays The Market
Neurocrine shares held onto their 50-day moving average last week, though slumped into that line on Monday. NBIX stock is forming a flat base with a buy point at 109.36, MarketSmith.com shows.
Bullishly, shares have a strong Relative Strength Rating of 93. This puts NBIX stock's performance over the past 12 months in the top 7% of all stocks, according to IBD Digital. Its technical and fundamental measures are in the leading 3% with a Composite Rating of 97.
Neurocrine is also an IBD Tech Leader.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
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