We came across a bullish thesis on AbCellera Biologics Inc. (ABCL) on Twitter by Jack Prescott. In this article, we will summarize the bulls’ thesis on ABCL. AbCellera Biologics Inc. (ABCL)’s share was trading at $2.94 as of Jan 16th. ABCL’s trailing P/E was 19.92 according to Yahoo Finance.
A data scientist standing in front of a large monitor presenting a drug discovery analysis.
AbCellera is a biotechnology company that specializes in antibody discovery using cutting-edge technologies, such as microfluidics and artificial intelligence (AI). The company’s platform is designed to rapidly identify and develop high-quality antibodies for therapeutic purposes. Through its microfluidics technology, AbCellera can efficiently screen millions of antibodies from humanized mice, identifying ideal candidates to target complex diseases like cancer.
The company’s approach distinguishes it from traditional biotech firms, which often focus on full drug development. Instead, AbCellera partners with biotech and pharmaceutical companies, helping them discover antibodies while earning royalties, milestone payments, and equity stakes. This asset-light model allows AbCellera to maintain a low cash burn while benefiting from high-profile partnerships. AbCellera’s collaborations with major players like Eli Lilly and Moderna further validate its platform, demonstrating its potential to contribute significantly to antibody-based therapeutics.
AbCellera rose to prominence during the COVID-19 pandemic, when it collaborated with DARPA to develop Bamlanivimab, the first monoclonal antibody therapy to receive FDA Emergency Use Authorization. Despite setbacks, such as the loss of EUA for COVID-related treatments, AbCellera’s ability to rapidly respond to health challenges has cemented its position as a key player in the biotechnology sector.
The company has a solid financial foundation, maintaining $700 million in cash and short-term investments with virtually no debt. AbCellera is further supported by $225 million in government grants from Canada, providing a liquidity cushion that extends its operating runway. With a market capitalization of around $830 million, AbCellera is currently trading below its cash value, making it an appealing investment.
AbCellera’s future prospects are also buoyed by its new GMP (Good Manufacturing Practice) facility, which was funded with over $100 million from the Canadian government. This facility will allow AbCellera to produce antibodies in-house and support clinical trials, further bolstering the company’s operations and providing opportunities to reduce operational costs.
With a pipeline of over 200 programs and collaborations with leading biotech and pharmaceutical companies, AbCellera continues to advance therapies in oncology and neuroscience, including a promising program targeting small cell lung cancer, which has received orphan drug designation from the FDA. This robust pipeline, combined with strategic partnerships, positions AbCellera as a strong contender in the biotechnology space.
Despite challenges such as the need to scale operations and navigate legal risks related to its technology, AbCellera’s leadership and financial strength provide a solid foundation for future growth. The company is well-positioned to continue expanding its capabilities and make significant strides in the development of new therapies.
AbCellera Biologics Inc. (ABCL) is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 13 hedge fund portfolios held ABCL at the end of the third quarter which was 16 in the previous quarter. While we acknowledge the risk and potential of ABCL as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than ABCL but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article was originally published at Insider Monkey.