5 Micro-Cap Stocks to Buy According to Hedge Funds

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1. Mereo BioPharma Group plc (NASDAQ:MREO)

Number of Hedge Fund Holders: 24

Market Capitalization: $233 million

Mereo BioPharma Group plc (NASDAQ:MREO) is working on providing new therapies against life-threatening oncology and rare diseases without proper treatment options available. Through Alvelestat (MPH-966), the UK-based biopharmaceutical company is working on countering the impact of rare and life-threatening antitrypsin deficiency (AATD)-related lung disease. Phase 1b/2 clinical study is also being conducted to observe the impact of Alvelestat to counter limited lung function in patients suffering from COVID-19. If Alvelestat receives approval from the FDA for the treatment of limited lung function in COVID-19 then it could propel Mereo BioPharma Group plc (NASDAQ:MREO) to new heights.

On October 26, the US Food and Drug Administration has given Alvelestat Orphan Drug status. This means that as AATD is a rare disease and it would not be profitable to produce the therapy with the support of the government. According to Mereo BioPharma Group plc’s (NASDAQ:MREO) CEO, Dr. Denise Scots-Knight, the approval by the FDA reflects that there is a “significant and urgent unmet need” for the treatment of AATD. Mereo BioPharma Group plc (NASDAQ:MREO) expects to give an update on the progress of its research by the end of 2021.

Analysts at Needham and BTIG initiated coverage on Mereo BioPharma Group plc (NASDAQ:MREO) with a Buy rating and a $10 price target in May 2021. Chad Messer at Needham highlighted Etigilimab as the growth driver for Mereo BioPharma. Etigilimab attaches itself to the human TIGIT receptor and works towards enhancing the performance of the T-Cell and NK cell anti-tumor activity. Both analysts highlighted the diversified pipeline of Mereo BioPharma Group plc (NASDAQ:MREO) to provide potential upside to investors.

You can also take a peek at the 10 Best Stocks to Buy According to Billionaire Carl Icahn and 10 Best REIT Dividend Stocks According to Hedge Funds.

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