Jun.15 — U.K. Prime Minister Boris Johnson makes a direct intervention into the Brexit talks today. He’ll hold a video call with three EU presidents in a bid to rejuvenate attempts to find a deal. Negotiations have struggled to make progress since March with neither side shifting dramatically from their starting positions. Bloomberg’s Maria Tadeo reports on “Bloomberg Daybreak: Europe.”
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Shares of Clinuvel Pharmaceuticals Limited (ASX: CUV) are trading nearly 3% up today with investors looking to the healthcare sector for value. Prior to the March market correction, Clinuvel’s share price was trading above $29 and are yet to regain these levels.
Clinuvel has spent the last 15 years developing its product, Scenesse; the world’s first systematic photoprotective drug. Scenesse is used to treat Erythropoietic Protoporphyria (EPP) which is a metabolic genetic disorder causing intolerance to light.
EPP patients suffer painful reactions and burns from exposure to direct light, which means they must avoid it at all times. Reactions can occur after just a few minutes of exposure and last days or weeks. The disorder is rare, affecting around 10,000 people worldwide and causes social isolation and anxiety.
The Scenesse drug provides EPP patients with photoprotection and the ability to lead a “normal” life. Prior to the creation and regulatory approval of Scenesse in Europe in 2014 and the US in 2019, EPP had no approved treatment.
Clinuvel has progressed from the R&D phase into the commercialisation phase with FY17 being the first year of commercial operations and the first profitable year. Its profits rose in FY18 and FY19, with the December 2019 period seeing Clinuvel eighth consecutive half-year profit. Its earnings per share increased from 18 cents in 2017 to above 30 cents in 2019.
Clinuvel paid its first dividends to shareholders in FY18 and FY19. The company is debt-free and has cash and equivalents of over $60 million. The share price has increased by around 700% over the last 5 years, taking Clinuvel into the S&P/ASX 200 (ASX: XJO) in June last year.
Clinuvel hopes to specialise in creating treatments for rare genetic conditions. And beyond 2020 it is seeking to evolve into a diversified pharmaceutical company.
Clinuvel plans to take Scenesse to new regions to develop a paediatric formulation. A clinical trial is also underway to evaluate Scenesse for the treatment of vitiligo as a repigmentation agent.
Clinuvel has strong cash flow and an ambition to deliver new products which provide treatment to multiple patient groups. Investors with an eye on the Clinuvel share price will be interested to see if it can sustain long-term growth and evolve into an integrated biopharmaceutical company.
For more shares to consider in your ASX portfolio, take a look at our free report below.
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Motley Fool contributor Kate O’Brien has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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After a reasonably subdued morning of trade, the S&P/ASX 200 Index (ASX: XJO) fell heavily in the afternoon to end the day notably lower.
The benchmark index tumbled a disappointing 2.2% to 5,719.8 points.
Australian investors were selling off shares this afternoon after U.S. futures took a sharp turn.
At present, futures contracts are pointing to the Dow Jones opening the day 3.3% lower, the S&P 500 starting the week with a 2.8% decline, and the Nasdaq index opening 2.3% lower.
According to CNBC, stock futures fell heavily amid signs of a second wave of coronavirus cases in the United States as the economy reopens. This follows a spike in cases late last week in a number of states.
President and chief investment strategist, Ed Yardeni, from Yardeni Research, believes that investors got ahead of themselves in respect to the reopening.
Mr Yardeni said, courtesy of CNBC, that: “The meltup may need to take a break, as sentiment has turned too bullish too rapidly. Now that reopening is happening, there’s fear of suboptimal results: less social distancing triggering a second wave of the virus, followed by another round of lockdowns.”
Though, another lockdown seems unlikely based on what Treasury Secretary Steven Mnuchin told CNBC late last week. Mnuchin suggested that shutting down the economy again wasn’t viable and would only “create more damage.”
Unfortunately for Australian investors, we have a tendency to follow the lead of U.S. markets regardless of what is happening over here. This means that if the U.S. does struggle with a second wave, it could weigh on our market in the near term.
However, I wouldn’t let this put you off investing. In fact, I would suggest you look to see if you like the look of any of the shares that have pulled back notably over the last few days.
Companies like Aristocrat Leisure Limited (ASX: ALL) and EML Payments Ltd (ASX: EML), for example, have fallen heavily since last week. I think this could be a buying opportunity for long term-focused investors. I feel both shares trade on attractive multiples relative to their long term earnings growth potential.
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James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Emerchants Limited. The Motley Fool Australia has recommended Emerchants Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
The post Why the ASX 200 tumbled lower on Monday and 2 shares to buy appeared first on Motley Fool Australia.
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