Genmab ADR (GMAB)

Our PAST TOP PICK with GMAB has triggered its stop at $24.  To remain disciplined, we recommend covering the position at this time.  Combined with our previous guidance, this will result in a net investment loss of 17%.  

Following recently released earnings, we reiterate GMAB as a TOP PICK.  The Danish based pharmaceutical company reported a 19% increase in revenues, thanks to a 54% increase in the sales of proprietary antibody treatments for cancer.  Cash reserves grew while shares were aggressively bought back.  It trades at 18x earnings, 3x book and supports a 17% ROE.  We continue to recommend a stop at $24, looking to achieve $37 — upside potential of 32%.  Yield 0%

GMAB is a biotech company based in the Netherlands producing human antibody treatments for cancer.  It collects a royalty agreement with J&J that pays $14.3 billion, of which over half originates from the US and the balance from Europe.   This is allowing for cash reserves to grow aggressively, while debt is retired.  Annual EPS growth exceeds 28% over the past five years and analysts see growth over 20% over the next five.  It trades at 16x earnings, 3.2x book and supports a 28% ROE.  We recommend setting a stop-loss at $24, looking to achieve $37 -- upside potential of 23%.  Yield 0%