Is Emergent BioSolutions (EBS) a Smart Long-term Buy?

Baron Discovery Fund recently published its third-quarter commentary – a copy of which can be downloaded here. During the third quarter of 2020, the Baron Discovery Fund returned 18.83% (institutional shares). This was 11.67% better than the Russell 2000 Growth Index, the Fund’s primary benchmark index. You should check out Baron Discovery Fund’s top 5 stock picks for investors to buy right now, which could be the biggest winners of 2021.

In the Q3 2020 Investor Letter, Baron Discovery Fund highlighted a few stocks and Emergent BioSolutions Inc. (NYSE:EBS) is one of them. Emergent BioSolutions Inc. (NYSE:EBS) is a specialty biopharmaceutical company. Year-to-date, Emergent BioSolutions Inc. (NYSE:EBS) stock gained 52.8% and on December 1st it had a closing price of $82.42. Here is what Baron Discovery Fund said:

“Emergent BioSolutions Inc. is a pharmaceutical company that provides vaccines and post-exposure treatments for extreme pathogens, including anthrax and smallpox, and emergency opioid overdose recovery drugs. During the quarter, Emergent was awarded numerous contracts from drug companies (Johnson & Johnson, Novavax, Vaxart, and AstraZeneca) and the U.S. Government (BARDA for Operation Warp Speed candidates), to help develop, and then ultimately provide volume production of COVID-19 vaccines. It is likely that Emergent is already producing vaccines in large volumes (it has contracts to produce hundreds of millions and up to a billion doses for various manufacturers), as Operation Warp Speed envisions producing vaccines “at risk” so that they will be ready to immediately ship to patients if and when the FDA approves them. We believe that Emergent will benefit for years from these COVID-19 programs and that it will grow other development and product revenues as well.”


In Q2 2020, the number of bullish hedge fund positions on Emergent BioSolutions Inc. (NYSE:EBS) stock increased by about 24% from the previous quarter (see the chart here), so a number of other hedge fund managers believe in EBS’s growth potential. Our calculations showed that Emergent BioSolutions Inc. (NYSE:EBS) isn’t ranked among the 30 most popular stocks among hedge funds.

The top 10 stocks among hedge funds returned 216% since the end of 2014 and outperformed the S&P 500 Index ETFs by more than 121 percentage points. We know it sounds unbelievable. You have been dismissing our articles about top hedge fund stocks mostly because you were fed biased information by other media outlets about hedge funds’ poor performance. You could have doubled the size of your nest egg by investing in the top hedge fund stocks instead of dumb S&P 500 ETFs. Below you can watch our video about the top 5 hedge fund stocks right now. All of these stocks had positive returns in 2020.

Video: Top 5 Stocks Among Hedge Funds

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Disclosure: None. This article is originally published at Insider Monkey.