The biotech sector has come down firmly from the highs of February as detrimental sentiment takes maintain. The sector had a serious increase of optimism from the success of the COVID-19 vaccines, making buyers keenly conscious of the potential of biopharma R&D engines. However from early this 12 months, medical trial, regulatory and entry setbacks have reminded buyers of the sector’s inherent dangers.
RBC Capital Markets not too long ago surveyed buyers to take the temperature of the market, a mixture of specialists/generalists and long-only/ long-short funding methods. Heading into the second half of the 12 months, buyers largely see the sector as undervalued (49%), a big change from the primary half of the 12 months when solely 20% rated it as undervalued. Round 41% of buyers now consider that biotech will underperform the S&P500 within the second half of 2021. Regardless of that view, 54% plan to keep up their place out there and 41% nonetheless plan to extend their holdings.
