In the US it is known for a long time: biotech is of vital importance and there is money to be made! Rudi Van den Eynde from Candriam comments: “In 2000, biotech was considered as a promising but risky sector. The fluctuations of the stocks were huge. In the mean time, the potential of biotech rose due to the emergence of big and profitable biotech companies. It is possible to build a stable investment portfolio. Biotech is less dependent on traditional economic parameters, though it remains a bit more volatile.”
Candriam obtained an average yearly return of 20,57% (compared to a NASDAQ biotech index of 17,65%). But mayby, biotech stocks are overrated?
Van den Eynde: “Biotech stocks tripled in the last three years, but this does not mean that they are overrated. The medical as well as the financial results are spectacular. Last year, 141 new biotech drugs were approved. There are a lot of breakthroughs for a lot of diseases. People are willing to pay for that, so a lot of money is made. Big biotech companies are listed at 18 to 25 times the profit they make. This is comparable to well-performing multinationals.”
Read the interview with Ward Capoen to get to know more about this topic.
