In just two days Exelixis (NASDAQ:EXEL) lost over 15% of its market cap.
The tumble for the once-hot biotech stock started last week with a downgrade of the stock by an analyst at Leerink Partners. According to the analyst, Mike Schmidt, it wasn’t over anything Exelixis did. The biotech company’s fundamentals still appear to be strong. Instead, the concerns were about the stock’s valuation.
Here are three reasons to buy the dip with EXEL.
Sales are booming for the company’s cabozantinib franchise.
In addition, its other approved drug, cobimetinib (marketed as Cotellic), could become a much bigger winner in the future.
“Pipeline replenishment” is another significant potential growth catalyst. The company is restarting its internal drug discovery programs. In addition, Exelixis is actively pursuing licensing candidates from other biotechs.