5 Best Small-Cap Healthcare Stocks To Buy Now

In this article, we discuss 5 best small-cap healthcare stocks to buy now. If you want to see more stocks in this selection, check out 12 Best Small-Cap Healthcare Stocks to Buy Now. 

5. Supernus Pharmaceuticals, Inc. (NASDAQ:SUPN)

Number of Hedge Fund Holders: 21

Market Capitalization as of December 12: $1.904 Billion

Supernus Pharmaceuticals, Inc. (NASDAQ:SUPN) is a Maryland-based biopharmaceutical company focused on the development and commercialization of products for the treatment of central nervous system diseases in the United States. The company posted a Q3 revenue of $177.35 million, up 19.4% year-over-year, beating market consensus by $4.87 million. Supernus Pharmaceuticals, Inc. (NASDAQ:SUPN) raised its full-year 2022 total revenue guidance to $650 million-$680 million, from $640 million-$680 million previously. It is one of the best healthcare stocks to invest in. 

On October 11, Piper Sandler analyst David Amsellem maintained an Overweight rating on Supernus Pharmaceuticals, Inc. (NASDAQ:SUPN) but lowered the price target on the shares to $36 from $38. The company received a complete response letter from the FDA for SPN-830, its subcutaneous continuous apomorphine infusion pump, in patients with advanced Parkinson’s disease, the analyst told investors. The positive news was that the FDA did not voice any concerns about safety or efficiency, but “not-so-good news” was that the agency did cite chemistry, manufacturing, and control issues with the underlying device and drug product, said the analyst. He believes the letter “portends a significant delay,” though he assumes that the issues are eventually fixable.

According to Insider Monkey’s Q3 data, 21 hedge funds were bullish on Supernus Pharmaceuticals, Inc. (NASDAQ:SUPN), compared to 19 funds in the earlier quarter. Steven Boyd’s Armistice Capital is the largest position holder in the company, with 4.6 million shares worth $155.4 million. 

Here is what Third Avenue Management specifically said about Supernus Pharmaceuticals, Inc. (NASDAQ:SUPN) in its Q2 2022 investor letter:

“Supernus Pharmaceuticals, Inc. (NASDAQ:SUPN) will be highlighted in a future letter. Supernus was a notable healthcare investment as Fund Management has struggled to find investments in the Healthcare sector given stretched valuations. With the Healthcare sector down nearly 30% YTD, it provided an opportunity to add a healthcare company to the Fund.”

4. Arvinas, Inc. (NASDAQ:ARVN)

Number of Hedge Fund Holders: 22

Market Capitalization as of December 12: $1.945 Billion

Arvinas, Inc. (NASDAQ:ARVN) is a Connecticut-based clinical-stage biopharmaceutical company that is engaged in the discovery, development, and commercialization of therapies to degrade disease-causing proteins. On November 22, Arvinas, Inc. (NASDAQ:ARVN) announced early results from its Phase 2 cohort expansion portion of a Phase 1/2 study for protein degrader ARV-471 it co-develops with Pfizer Inc. (NYSE:PFE), indicating a clinical benefit rate of 38% among breast cancer patients. 

On December 5, investment advisory Citi maintained a Buy recommendation on Arvinas, Inc. (NASDAQ:ARVN) but lowered the price target on Arvinas, Inc. (NASDAQ:ARVN) to $72 from $88. Analyst Yigal Nochomovitz issued the ratings update. 

According to Insider Monkey’s data, 22 hedge funds were bullish on Arvinas, Inc. (NASDAQ:ARVN) at the end of the third quarter of 2022, with combined stakes worth $445.8 million, compared to 21 funds in the prior quarter worth $374.5 million. David Witzke and Michael Gregory’s Avidity Partners Management is the biggest position holder in the company, with 4.3 million shares worth $193.2 million. 

3. Revance Therapeutics, Inc. (NASDAQ:RVNC)

Number of Hedge Fund Holders: 23

Market Capitalization as of December 12: $1.773 Billion

Revance Therapeutics, Inc. (NASDAQ:RVNC) is a Tennessee-based biotechnology company that specializes in the development, manufacture, and commercialization of neuromodulators for various aesthetic and therapeutic indications in the United States and internationally. On November 8, Revance Therapeutics, Inc. (NASDAQ:RVNC) reported a Q3 revenue of $29 million, up 47.2% year-over-year, beating Wall Street consensus by $0.76 million. It is one of the best healthcare stocks to invest in. 

On November 16, investment advisory Barclays raised the firm’s price target on Revance Therapeutics, Inc. (NASDAQ:RVNC) to $37 from $35 and kept an Overweight rating on the shares after meeting with management. Analyst Balaji Prasad issued the ratings update. 

According to Insider Monkey’s data, 23 hedge funds were long Revance Therapeutics, Inc. (NASDAQ:RVNC) at the end of September 2022, with collective stakes worth $428 million, compared to 15 funds in the prior quarter worth $179.2 million. Brian Ashford-Russell and Tim Woolley’s Polar Capital is the biggest position holder in the company, with 4.46 million shares worth $120.4 million. 

Baron Funds made the following comment about Revance Therapeutics, Inc. (NASDAQ:RVNC) in its Q3 2022 investor letter:

“Shares of Revance Therapeutics, Inc. (NASDAQ:RVNC), an aesthetics-forward biotechnology company, contributed to performance in the quarter. Following several delays, the U.S. FDA finally approved Daxxify, the company’s longer-acting competitor to Botox in September. Unlike Botox, Daxxify contains a peptide that helps the toxin localize to the injection site and adhere to neurons. While the effect of Botox tends to fade in three to four months, Daxxify’s effects last on average six months. We think the longer duration of action is a key selling point for consumers. Revance is launching Daxxify to a select group of injectors over the next six months to gain real-world experience before a broader launch in the second quarter of 2023. We think consumer and injector demand is strong, and we expect to see meaningful uptake in the second half of 2023. Ultimately, we see Daxxify and Revance’s already launched RHA fillers capturing significant share in the fast-growing $4 billion-plus facial injectables market and supporting more than twice Revance’s current valuation.”

2. Fate Therapeutics, Inc. (NASDAQ:FATE)

Number of Hedge Fund Holders: 28

Market Capitalization as of December 12: $1.837 Billion

Fate Therapeutics, Inc. (NASDAQ:FATE) is a California-based clinical-stage biopharmaceutical company that develops programmed cellular immunotherapies for cancer and immune disorders worldwide. On November 16, Citi analyst Yigal Nochomovitz maintained a Buy recommendation on Fate Therapeutics, Inc. (NASDAQ:FATE) but lowered the price target on the shares to $80 from $87. The analyst updated his model following the Q3 results.

According to Insider Monkey’s Q3 data, Fate Therapeutics, Inc. (NASDAQ:FATE) was part of 28 hedge fund portfolios, compared to 23 in the prior quarter. Jeremy Green’s Redmile Group is the largest stakeholder of the company, with approximately 13 million shares worth $290.3 million. It is one of the best small-cap healthcare stocks to invest in as per smart hedge funds. 

1. BioCryst Pharmaceuticals, Inc. (NASDAQ:BCRX)

Number of Hedge Fund Holders: 34

Market Capitalization as of December 12: $1.957 Billion

BioCryst Pharmaceuticals, Inc. (NASDAQ:BCRX) is a North Carolina-based biotechnology company that discovers novel, oral, and small-molecule medicines. It is one of the best healthcare stocks to monitor. On November 1, BioCryst Pharmaceuticals, Inc. (NASDAQ:BCRX) reported a Q3 revenue of $75.8 million, up 84.9% year-over-year and beating market estimates by $1.02 million. Cash, cash equivalents, restricted cash, and investments came in at $462.6 million on September 30, 2022, compared to $203.9 million on September 30, 2021.

On November 2, Evercore ISI analyst Liisa Bayko upgraded BioCryst Pharmaceuticals, Inc. (NASDAQ:BCRX) to Outperform from In Line with a price target of $16, up from $14. The stock traded 11% lower after the company’s “sluggish quarter,” but the analyst sees this as an opportunity to buy the dip given the view that Orladeyo’s long-term prospects are intact despite some “short-term blips in numbers.” 

According to Insider Monkey’s data, 34 hedge funds were bullish on BioCryst Pharmaceuticals, Inc. (NASDAQ:BCRX) at the end of Q3 2022, compared to 31 funds in the earlier quarter. Julian Baker and Felix Baker’s Baker Bros. Advisors is the biggest position holder in the company, with 12.7 million shares worth $160 million.

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