Editorial StaffRemember a year ago, when we all joked that 2020 could leave early, let’s just get into 2021? Well, 2021 is on its way out now, giving us a stock market at record highs and a Congress that can’t figure out how to pass the majority’s spending bills. It’s a situation seemingly designed for uncertainty and high volatility.
For investors, of all stripes, the key point is finding stocks that are set to gain, stocks that will thrive in today’s market environment. And with just two months left in 2021, that makes the analysts’ year end picks a place to look.
So let’s take a look at two Top Picks for Year End 21, from the analysts at B. Riley Securities. According to the TipRanks database, these are Strong Buy-rated stocks – and the analysts see them delivering returns starting at 40%, and working up from there. Let’s take a look at the details and find out what else makes a Top Pick.
Customers Bancorp (CUBI)
We will start with Customers Bancorp, the holding company behind Pennsylvania-based Customers Bank. The company has offices, operations, and branches in the states of Florida, Illinois, New Hampshire, New Jersey, New York, North Carolina, Rhode Island, and Texas, as well as Pennsylvania, and offers a full range of personal and commercial banking services. The bank has $19.1 billion in total assets, and even offers its customers a blockchain-based digital payment service.
Customers Bancorp has seen its revenues, earnings, and share price all gain steadily over the past couple of years. The stock has gained a whopping 312% in the past 12 months, a gain that includes a recent spike after the release of the 3Q21 earnings. In the third quarter, the company reported over $242 million at the top line, up 40% from the year ago quarter. EPS spiked from $1.72 in Q2 to $3.25 in Q3, a gain of 88%, and was also up 119% yoy.
One of CUBI’s major initiatives was the launch of its digital payment service, based on blockchain technology and allowing round-the-clock instant digital payments. The bank launched this initiative with TassatPay in October, through the launch of Customer Bank Instant Token (CBIT) on TassatPay’s platform. The launch makes CBIT available to B2B clients seeking the benefits of faster payments, and provides those benefits with the security of blockchain.
Customers Bancorp is the Top Pick of 5-star analyst Steve Moss, who says, “[We] believe the stock remains attractively valued ahead of its soft launch to provide real-time payments for crypto customers. CUBI remains active in adding and improving its fintech initiatives, which we believe should support a re-rating of the stock. Management indicated that demand for its real-time payments platform was greater than expected, which we believe bodes well for deposit growth in 4Q21 and 2022.”
Moss also notes that CUBI’s blockchain-based payment token is a major point of differentiation between the bank and competitors, as “CUBI will be [only] the third bank in the U.S. to offer real-time payment services to crypto-related customers.”
Moss’s comments back up his Buy rating, and his $80 price target indicates his confidence in ~40% one-year upside potential.
Overall, there are 4 recent analyst reviews on record for CUBI shares, and they break down 3 to 1 in favor of the Buys over Hold to give the stock its Strong Buy consensus rating.
Curis, Inc. (CRIS)
The second stock on our list of ‘Analyst Top Picks’ is a biopharmaceutical company. These medical research firms are on the cutting edge of high tech, developing new treatments for every disease imaginable. Curis keeps its focus on new cancer treatments, creating first-in-class therapeutics for a wide range of malignancies.
Curis is one of the fortunate few biotechs with both an active research pipeline and an approved drug on the market. Curis’ drug, Erivedge, is a treatment for basal cell carcinoma in the US and the EU. Basal cell carcinoma is a common skin cancer, and Curis has licensed the commercialization of Erivedge to Roche and Genentech while retaining royalty rights.
Those royalty rights bumped the company’s revenue up to $2.3 million in the second quarter of this year, flat year-over-year, and up slightly from the first quarter. EPS came in negative; the company ran a net loss of 12 cents per share, mainly to due to the high overhead inherent in biopharma research.
Curis has two leading drug candidates in early stages; CA-4948 is a IRAK4 inhibitor used in the treatment of hematologic cancers, while CI-8993 is proposed treatment for VISTA-expressing cancers. The first has presented investors with some bad news back in June. The company announced results of a safety and dose toleration study, which indicated that high doses (400 milligram and higher) showed toxicity, while a 300 milligram dose was selected for ongoing studies. The stock fell over 30% on news of the toxicity findings, and has yet to recover.
Analyst Justin Walsh, in pointing out why Curis is his Top Pick, writes of the sell-off during the summer: “We believe that the negative reaction was unwarranted and remain as confident as ever in the asset’s [CA-4948] potential in both leukemia and lymphoma.”
Walsh goes on at greater length about CI-8993, saying, “Additionally, the company is expected to release initial safety data from its VISTA-targeting asset in solid tumors by YE21. We believe that this readout represents a key derisking event for the asset because it will demonstrate whether the protocol amendments allow this previously abandoned asset to be tolerated by patients. Given that we believe investors largely ignore the VISTA-targeting asset, we see more potential for upside than downside on the data release.”
These comments support a Buy rating, and Walsh’s $22 price target implies a potential 12-month upside of 238% for the stock.
Judging by the consensus breakdown, opinions are anything but mixed. With 3 Buys and no Holds or Sells assigned in the last three months, the word on the Street is that CRIS is a Strong Buy.
Source: Yahoo Finance
