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3 Stocks on J.P. Morgan’s Radar for Over 60% Upside

3 Stocks on J.P. Morgan’s Radar for Over 60% Upside



In the final leg of 2020, does the market have what it takes to reach a record high? If you ask J.P. Morgan, the answer is yes.

According to strategist Dubravko Lakos-Bujas, the S&P 500’s earnings are bouncing back more quickly than expected thanks to the Federal Reserve’s accommodative monetary policy, global reopenings and long-term tech plays. He argues this earnings trend could power the index’s rally to a record 3,600, reflecting a 6% gain from current levels.

Tech is the key here. Although the space has had a rough going recently, the strategist sees the latest pullback as “healthy," noting that tech names are still relatively insulated from COVID’s economic impact. Tech profits could also potentially help offset earnings weakness in the broader market.

“As for COVID-19 sensitive companies, Q2 likely marked the bottom with earnings to see a sustained recovery as the economy rebounds, and consumer and corporate behavior gradually normalize,” Lakos-Bujas commented. What’s more, the firm expects improving demand and falling interest costs to drive a rebound in S&P 500 companies’ margins, with a full recovery potentially coming by the second half of 2021.

Bearing this in mind, we wanted to take a closer look at three stocks that have earned J.P. Morgan’s stamp of approval. Accompanying a bullish rating, the firm’s analysts believe each could climb at least 60% higher in the year ahead. Running the tickers through TipRanks’ database, we got all the details and learned what makes them such compelling plays.

PDC Energy (PDCE)

First up we have PDC Energy, which is the second largest oil and gas producer in the DJ Basin and has significant scale (182,000 net acres). Based on its standing in the space, J.P. Morgan is pounding the table on this name.

Firm analyst Arun Jayaram sees the company as one of the “positioned operators among the small to mid-cap E&Ps given that it pairs a strong free cash flow profile and relatively clean balance sheet with a cheap multiple.” Out of all the names in the firm’s E&P coverage universe, PDCE trades at the lowest 2021 EBITDA multiple and has the highest free cash flow yield.

Additionally, even though Colorado politics presents challenges given that it’s a purple state, or a swing state, the analyst believes these headwinds can be overcome.

“In our view, the stock appears to be discounting a significant haircut to its undrilled inventory from regulatory headwinds in Colorado consistent with the implementation of ‘hard’ 2,000 ft. setback rules. While we don’t expect potentially restrictive political measures in Colorado to go away, we see the current ~2.6x discount as too punitive, with just a half turn re-rate providing ~40% upside to shares,” Jayaram commented.

The analyst argues that the stock presents investors with a “rare opportunity” to snap up a name at a discount to PDP value. Shares are currently changing hands for only 73% of Jayaram’s PDP estimates, based on recent strip pricing.

“We view this as a compelling risk-reward given the growing likelihood the State could enforce ‘soft’ 2,000 ft. setbacks that would still provide PDCE with the ability to tap the lion’s share of its undrilled DJ Basin inventory, albeit with additional administrative hurdles in the permit process that could modestly raise the cost of doing business,” the analyst stated.

It should be noted that PDCE has approximately 400 DUCs or permitted wells in the DJ Basin, which could serve to buffer the operational risk for several years and provide leeway for the company to successfully navigate the changes to the permitting process, in Jayaram’s opinion.

With the “significant dislocation from the value of the underlying asset base,” Jayaram gives PDCE a place on J.P. Morgan's U.S. Equity Analyst Focus List as a value pick.

It should come as no surprise, then, that Jayaram sides with the bulls. To this end, he puts an Overweight rating and $23 price target on the stock. Investors could be pocketing a gain of 93%, should this target be met in the twelve months ahead. (To watch Jayaram’s track record, click here)

Are other analysts in agreement? They are. Only Buy ratings, 11, in fact, have been issued in the last three months. Therefore, the verdict is unanimous: PDCE is a Strong Buy. Given the $21.50 average price target, shares could jump 80% in the next year. (See PDCE stock analysis on TipRanks)

GeoPark (GPRK)

Moving on to another player in the energy game, GeoPark is a leading independent oil and gas company with oil and gas assets in Chile, Colombia, Brazil, Peru and Argentina. With a solid asset base in Colombia, which accounts for 81% of its production, J.P. Morgan sees big things in store for this oil play.

Writing for the firm, analyst Ricardo Rezende opined: “We recommend GPRK for investors looking for exposure to oil prices... we think the stock reflects long-term oil prices at $50/barrel (bbl), in line with the current the forward curve.”  

In addition, the company’s portfolio management approach to its assets (operations must be self-funding and prove their value on a standalone basis) and the fact that it recently grouped its operations into two segments, could “help the company rein in costs – an additional positive, especially in a low oil price environment,” according to Rezende.

That being said, Rezende argues “most of GeoPark’s current – and future – value lies in its Colombian operations.” Llanos-34, its “best asset”, is located in the country. This asset saw an average production of 26kboed in Q2 2020, with it also holding roughly 71% of net proved reserves.

GPRK has made a significant effort to expand its exposure to the areas around Llanos 34, with its holdings in the area now totaling over 1.4 million acres. As part of these efforts, it acquired five exploration blocks in partnership with Hocol (Ecopetrol), agreed with Parex to assume a 50% working interest in the Llanos 94 block and acquired Amerisur, an independent E&P whose most relevant block (CPO-5) is in the vicinity of Llanos 34.

The latter acquisition is the key to the company’s success, in Rezende’s opinion, as it “opened a new exploration region for GeoPark: Putumayo, a region closer to the border with Ecuador.”

Expounding on this, the analyst stated, “Llanos 34 and its vicinities, in our view, are much more important drivers to GeoPark’s investment case than any other blocks the company has a stake in. Also, a successful exploration campaign in areas that GeoPark recently incorporated and the ramp-up on CPO-5 are the other relevant triggers in the area. We see production in Colombia reaching 39.8 kbpd in 2023, compared to 28.5kbpd in 2018.”

All of this prompted Rezende to rate GPRK an Overweight (i.e. Buy) along with a $16 price target. This target conveys his confidence in GPRK’s ability to soar 119% in the next year. (To watch Rezende’s track record, click here)

Looking at the consensus breakdown, 2 Buys and no Holds or Sells have been published in the last three months. Therefore, GPRK gets a Moderate Buy consensus rating. Based on the $13.60 average price target, shares could surge 85% in the next year. (See GeoPark stock analysis on TipRanks)

iTeos Therapeutics (ITOS)

Making our way to the healthcare sector, iTeos Therapeutics is focused on the discovery and development of a new generation of highly differentiated immuno-oncology therapeutics. With its development pipeline boasting significant potential, J.P. Morgan thinks that now is the time to get in on the action.

Its two lead candidates, EOS-850 (an A2AR antagonist) and EOS-448 (an anti-TIGIT antibody), are targeting key mechanisms of cancer immunosuppression, and are in development alone as well as with other therapeutic combinations.

The A2A receptor, a key signaling component within the immunosuppressive ATP-adenosine pathway, has been shown to modulate immune responses in pathological conditions. As for the T-cell immunoreceptors with immunoglobulin (Ig) and ITIM domains (TIGIT) program, it is another receptor that certain cancer types use to sustain tumor growth.

Weighing in for J.P. Morgan, 5-star analyst Anupam Rama wrote: “We acknowledge that development in the adenosine and TIGIT classes are competitive with the likes of multiple large pharma/biotechs and SMID biotechs; that said, we still see iTeos as having multiple value-creating levers with both EOS-850 and EOS-448.”

These include the potential for the molecules to differentiate themselves over time within a particular target class. EOS-850 has demonstrated a differentiated PK/PD profile pre-clinically, with early responses looking encouraging. Based on this solid data, a Phase 1/2 trial was initiated for EOS-850 in patients with advanced solid tumors, both as monotherapy and in combination with standard of care therapies. Dose escalation in the combination arms of the study is expected to begin in Q3 2020, and data from the dose expansion monotherapy cohort is expected in 1H21. Rama sees these readouts as capable of driving major upside.

It should also be noted that a new formulation of EOS-850 with improved dissolution properties and good absorption under high pH conditions is expected to be available for a clinical bridging study in Q1 2021, with completion potentially coming in Q2 2021. Assuming a net initial price of $12,000 per cycle of therapy, Rama estimates peak global sales of $2-2.5 billion by 2039.

Additionally, EOS-448 has shown high binding affinity and that it actively engages FcyR, based on preclinical data. A Phase 1/2a study is now underway for EOS-448 in patients with advanced solid tumors, and preliminary results from the escalation phase are slated for release in 1H21, another potential catalyst, according to Rama. For this therapy, Rama believes peak sales could land at $3 billion.

“From current levels, execution on one product across a few indications or a combination of both products in more select go-forward indications has the potential to create meaningful value (via probability of success increase and/or peak revenue increases),” Rama said.

What’s more, both therapies are wholly owned by ITOS, which leaves “the potential for future strategic interest in both assets pending evolution of data,” in Rama’s opinion. On top of this, both assets have shown signals of activity in interesting but less-competitive indications.

Everything that ITOS has going for it convinced Rama to keep an Overweight (i.e. Buy) rating on the stock. Along with the call, he attaches a $40 price target, suggesting 61% upside potential. (To watch Rama’s track record, click here)

Turning now to the rest of the Street, other analysts echo Rama’s sentiment. 4 Buys and no Holds or Sells add up to a Strong Buy consensus rating. At $45, the average price target is more aggressive than Rama’s and implies 81% upside potential. (See ITOS stock analysis on TipRanks)

To find good ideas for stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.

Disclaimer: The opinions expressed in this article are solely those of the featured analysts. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.

The post 3 Stocks on J.P. Morgan’s Radar for Over 60% Upside appeared first on TipRanks Financial Blog.

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Family Of College Student Who Died From COVID-19 Vaccine Sues Biden Administration

Family Of College Student Who Died From COVID-19 Vaccine Sues Biden Administration

Authored by Zachary Stieber via The Epoch Times (emphasis…



Family Of College Student Who Died From COVID-19 Vaccine Sues Biden Administration

Authored by Zachary Stieber via The Epoch Times (emphasis ours),

The family of a college student who died from heart inflammation caused by Pfizer’s COVID-19 vaccine has sued President Joe Biden’s administration, alleging officials engaged in “willful misconduct.”

George Watts Jr. in a file image. (Courtesy of the Watts family)

U.S. Department of Defense (DOD) officials wrongly promoted COVID-19 vaccination by repeatedly claiming the available vaccines were “safe and effective,” relatives of George Watts Jr., the college student, said in the new lawsuit.

That promotion “duped millions of Americans, including Mr. Watts, into being DOD’s human subjects in its medical experiment, the largest in modern history,” the suit states.

The Public Readiness and Emergency Preparedness Act allows lawsuits against certain people if they have engaged in “willful misconduct” and if that misconduct caused death or serious injury.

COVID-19 vaccines are covered by the act due to a declaration entered during the Trump administration in 2020 after COVID-19 began circulating.

DOD’s conduct and the harm caused as alleged within the four corners of the lawsuit speaks for itself,” Ray Flores, a lawyer representing the Watts family, told The Epoch Times via email. “I have no further comment other than to say: My only duty is to advocate for my client. If the DOD conveys a settlement offer, I will see that it’s considered.”

The suit was filed in U.S. court in Washington.

The Pentagon and the Department of Justice did not respond to requests for comment.

Watts Suddenly Died

Watts was a student at Corning Community College when the school mandated COVID-19 vaccination for in-person classes in 2021. He received one Pfizer dose on Aug. 27, 2021, and a second dose approximately three weeks later.

Watts soon began experiencing a range of symptoms, including tingling in the feet, pain in the heels, numbness in the hands and fingers, blood in his sperm and urine, and sinus pressure, according to family members and health records.

Watts went to the Robert Packer Hospital emergency room on Oct. 12, 2021, due to the symptoms. X-rays showed clear lungs and a normal heart outline.

Watts was sent home with suggestions to follow up with specialists but returned to the emergency room on Oct. 19, 2021, with worsening symptoms despite a week of the antibiotic Augmentin. He was diagnosed with sinusitis and bronchitis.

While speaking to his mother at home on Oct. 27, 2021, Watts suddenly collapsed. Emergency medical personnel rushed to the home but found him unresponsive. He was rushed to the same hospital in an ambulance. He was pronounced deceased at age 24.

According to a doctor at the hospital, citing hospital records and family members, Watts had no past medical history on file that would explain his sudden death, with no known history of substance abuse or obvious signs of substance abuse. His mother described her son as a “healthy young male.”

Dr. Robert Stoppacher, a pathologist who performed an autopsy on the body, said that the death was due to “COVID-19 vaccine-related myocarditis.” The death certificate listed no other causes. A COVID-19 test returned negative. Dr. Sanjay Verma, based in California, reviewed the documents in the Watts case and said that he believed the death was caused by the COVID-19 vaccination.

Pfizer did not respond to a request for comment.

Watts Took Vaccine Under Pressure

The community college mandate included a 35-day grace period following approval by the U.S. Food and Drug Administration (FDA) of a COVID-19 vaccine.

The Moderna, Pfizer, and Johnson & Johnson vaccines were given emergency use authorization early in the pandemic. The FDA approved the Pfizer shot on Aug. 23, 2021. It was the first COVID-19 vaccine approval. But doses of the approved version of the shot, branded Comirnaty, were not available for months after the approval.

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Tyler Durden Fri, 06/02/2023 - 23:00

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US Sent Billions in Funding to China, Russia For Cat Experiments, Wuhan Lab Research: Ernst

US Sent Billions in Funding to China, Russia For Cat Experiments, Wuhan Lab Research: Ernst

Authored by Mark Tapscott via The Epoch Times…



US Sent Billions in Funding to China, Russia For Cat Experiments, Wuhan Lab Research: Ernst

Authored by Mark Tapscott via The Epoch Times (emphasis ours),

Hundreds of millions of U.S. tax dollars went to recipients in China and Russia in recent years without being properly tracked by the federal government, including a grant that enabled a state-run Russian lab to test cats on treadmills, according to Sen. Joni Ernst (R-Iowa).

Sen. Joni Ernst (R-Iowa) speaks at a Senate Republican news conference in the U.S. Capitol on March 9, 2022. (Anna Moneymaker/Getty Images)

Ernst and her staff investigators, working with auditors at the Government Accountability Office (GAO) and the Congressional Research Service, as well as two nonprofit Washington watchdogs—Open The Books (OTB) and the White Coat Waste Project (WCWP)—discovered dozens of other grants that weren’t counted on the federal government’s internet database.

While the total value of the uncounted grants found by the Ernst team is $1.3 billion, that amount is just the tip of the iceberg, the GAO reported.

Among the newly discovered grants is $4.2 million to China’s infamous Wuhan Institute of Virology (WIV) “to conduct dangerous experiments on bat coronaviruses and transgenic mice,” according to a May 31 Ernst statement provided to The Epoch Times.

The $4.2 million exposed by Ernst is in addition to previously reported funding to the WIV for extensive gain-of-function research by Chinese scientists, much of it funded in whole or part prior to the COVID-19 pandemic by National Institutes for Health (NIH) grants channeled through the EcoHealth Alliance medical research nonprofit.

The NIH has awarded seven grants totaling more than $4.1 million to EcoHealth to study various aspects of SARS, MERS, and other coronavirus diseases.

Buying Chinese Puppy Parts

As part of another U.S.-funded grant, hearts and other organs from 425 dogs in China were purchased for medical research.

These countryside dogs in China are part of the farmer’s household; they were mainly used for guarding. Their diet includes boiled rice, discarded raw food animal tissues, and whatever dogs can forage. These dogs were sold for food,” an NIH study uncovered by the Ernst researchers reads.

Other previously unreported grants exposed by the Ernst team include $1.6 million to Chinese companies from the federal government’s National School Lunch Program and $4.7 million for health insurance from a Russian company that was sanctioned by the United States in 2022 as a result of the invasion of Ukraine.

“It’s gravely concerning that Washington’s reckless spending has reached the point where nobody really knows where all tax dollars are going,” Ernst separately told The Epoch Times. “But I have the receipts, and I’m shining a light on this, so bureaucrats can no longer cover up their tracks, and taxpayers can know exactly what their hard-earned dollars are funding.”

The problem is that federal officials don’t rigorously track sub-awards made by initial grant recipients, according to the Iowa Republican. Such sub-awards are covered by a multitude of federal regulations that stipulate many conditions to ensure that the tax dollars are appropriately spent.

The GAO said in an April report that “limitations in sub-award data is a government-wide issue and not unique to U.S. funding to entities in China.”

GAO is currently examining the state of federal government-wide sub-award data as part of a separate review,” the report reads.

Peter Daszak, right, the president of the EcoHealth Alliance, is seen in Wuhan, China, on Feb. 3, 2021. (Hector Retamal/AFP via Getty Images)

The Eco-Health sub-awards to WIV illustrate the problem.

“Despite being required by law to make these receipts available to the public on the website, EcoHealth tried to cover its tracks by intentionally not disclosing the amounts of taxpayer money being paid to WIV, which went unnoticed for years,” Ernst said in the statement.

“I was able to determine that more than $490 million of taxpayer money was paid to organizations in China [in] the last five years. That’s ten times more than GAO’s estimate! Over $870 million was paid to entities in Russia during the same period!

Together that adds up to more than $1.3 billion paid to our adversaries. But again, these numbers still do not represent the total dollar amounts paid to institutions in China or Russia since those numbers are not tracked and the information that is being collected is incomplete.”

Adam Andrzejewski, founder and chairman of OTB, told The Epoch Times, “When following the money at the state and local level, the real corruption exists in the subcontractor payments. At the federal level, the existing system doesn’t even track many of those recipients.

“Without better reporting, agencies and appropriators don’t truly understand how tax dollars were used. We now know that taxpayer dollars are traded further downstream than originally realized with third- and fourth-tier recipients. These transactions need scrutiny. Requiring recipients to account for where and how they actually spend each dollar creates a record far better than agencies are capable of generating.”

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Tyler Durden Fri, 06/02/2023 - 19:40

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OraSure Technologies’ CFO Makes Bold Insider Purchase, Reigniting Investor Confidence

Executive Kenneth McGrath’s $500,000 buy read as promising signal about future for diagnostic test developer OraSure Technologies (NASDAQ:OSUR) saw…




Executive Kenneth McGrath’s $500,000 buy read as promising signal about future for diagnostic test developer

OraSure Technologies (NASDAQ:OSUR) saw a stock price re-rate on Thursday, climbing 11% after investors became aware of its CFO Kenneth McGrath buying shares in the diagnostic test developer.  This latest rally in OSUR stock, gives traders and investors hope that the strong momentum from the beginning of 2023 might return.

OSUR shares had mounted an impressive 54% rally for 2023 through to May 10, when the first-quarter results update spooked investors. 

The CFO’s trade was initially spotted on Fintel’s Insider Trading Tracker following the filing with the Securities and Exchange Commission.

Big Holdings Boost

In the Form 4 filing, McGrath, who assumed CFO duties in August 2022, disclosed buying 100,000 shares on May 30 in the approved trading window that was open post results.

McGrath on average paid $4.93 per share, giving the total transaction a value just shy of $500,000 and boosted his total share count ownership to 285,512 shares.

The chart below from the insider trading and analysis report for OSUR shows the share price performance and profit made from company officers in previous transactions:

OraSure Technologies

Prior to joining OraSure, McGrath had an impressive eight-year tenure at Quest Diagnostics (NYSE:DGX), where he rose to the position of VP of Finance before departing. This is the first time that the CFO has bought stock in the company since August 2022. It is also worth noting that the purchase followed strong Q1 financial results, which exceeded Street forecasts.

Revenue Doubles

In its recently published Q1 update, OraSure Technologies told investors that it generated a whopping 129% increase in revenue to $155 million, surpassing analyst expectations of around $123 million. 

Notably, the revenue growth was driven primarily by the success of OraSure’s COVID-19 products, which accounted for $118.4 million in revenue for the quarter and grew 282% over the previous year.

The surge in revenue for this product was largely driven by the federal government’s school testing program, which led to record test volumes. However, it is important to note that demand for InteliSwab is expected to decline in Q2 2023, prompting OraSure to scale down its COVID-19 production operations. As part of its broader strategy to consolidate manufacturing, the company plans to close an overseas production facility.

While the COVID-19 products division has been instrumental in OraSure’s recent success, its core business delivered stable flat sales of $36.6 million during the quarter. 

In terms of net income, OraSure achieved an impressive result of $27.2 million, or $0.37 per share, in Q1, marking a significant improvement compared to the loss of $19.9 million, or a loss of $0.28 per share, in the same period last year. This result exceeded consensus forecasts of $0.16 per share. As of the end of the quarter, the company held $112.4 million in cash and cash equivalents.

Looking ahead to Q2, OraSure has provided revenue guidance in the range of $62 to $67 million, reflecting the lower order activity from the US government with $25 to $30 million expected sales for InteliSwab. The declining Covid related sales have been a core driver of the share price weakness in recent weeks.

While sales are likely to fall in the coming quarters, one positive for the company is its low debt balance during this period of rising cash rates. The chart below from Fintels financial metrics and ratios page for OSUR shows the cash flow performance of the business over the last five years.

OraSure Technologies

Analyst Opinions

Stephen’s analyst Jacob Johnson thinks that outside of Covid, OSUR continues to execute on several cost and partnership initiatives which he believes appears to be bearing fruit. Johnson pointed out that three partnerships were signed during the quarter.

The analyst thinks that the ex-Covid growth story will be the new focus for investors from now on. The brokerage maintained its ‘equal-weight’ recommendation and $6.50 target price on the stock, matching Fintel’s consensus target price, suggesting OSUR stock could rise a further 29% in the next 12 months. 

The post OraSure Technologies’ CFO Makes Bold Insider Purchase, Reigniting Investor Confidence appeared first on Fintel.

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