We recently published a list of the 7 Best Performing Long Term Stocks in 2024. In this article, we are going to take a look at where Avidity Biosciences, Inc. (NASDAQ:RNA) stands against the other best performing long term stocks in 2024.
After the latest 50 basis point rate cut by the Federal Reserve, the market has been performing well. All of the major market indices have been in the green since then and experts are taking it as a good sign.
We discussed the Fed’s rate cut in our article about the best day trading stocks. Here is an excerpt from the article:
“…the Federal Open Market Committee (FOMC) chose to lower its policy interest rate by 50 basis points, a move intended to ease monetary policy. Powell explained that this action reflects growing confidence that labor market strength can be maintained, while inflation continues to decrease toward the Fed’s target. Powell emphasized the Fed’s flexibility in its approach and noted that future rate changes will depend on incoming data and the evolving economic landscape.
When questioned about the likelihood of future rate cuts, Powell said that each decision would be data-driven and made on a meeting-by-meeting basis. The Summary of Economic Projections (SEP) suggests a federal funds rate of 4.4% by the end of the year, with further reductions expected in the years ahead, which points to expectations of lower inflation and slightly higher unemployment.”
Understanding the Current Stock Market Optimism
Lead writer for Markets Live at The Wall Street Journal, Gunjan Banerji also shares the market’s optimistic sentiment as she explained in an interview with CNBC on September 25. Banerji discussed the growing optimism in the stock market despite ongoing bullish sentiment for the past few years. She highlighted how the recent rate cut by the Federal Reserve boosted market confidence, with the VIX (volatility index) dropping to its lowest levels and other indicators like high-yield bonds and options showing continued belief in the rally.
Dominic Chu of CNBC expressed concerns about potential market overconfidence, given the calmness amid geopolitical risks, the upcoming U.S. presidential election, and consumer spending challenges. Banerji acknowledged these risks but emphasized that much of the market’s optimism is tied to the Fed’s actions, with people reassured by the larger-than-expected rate cut.
Finally, Banerji pointed out a broadening of the market rally beyond the tech sector and mentioned the strong performances in sectors like energy and materials, and record highs from companies like Caterpillar and McDonald’s, which indicates a healthier, more diverse market rally.
Our Methodology
For this article, we used stock screeners to identify nearly 60 mid to mega-cap stocks with year-to-date share price returns of over 100%. Next, we narrowed our list to 7 stocks with the highest average analyst price target upside, as of September 24. We also added the hedge fund sentiment around each stock which was taken from Insider Monkey’s database of over 900 elite hedge funds. The stocks are sorted in ascending order of their upside potential.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Is Avidity Biosciences, Inc. (NASDAQ:RNA) the Best Performing Long Term Stock in 2024?
Avidity Biosciences, Inc. (NASDAQ:RNA)
Average Analyst Price Target Upside: 39.77%
Stock Price Performance YTD: 380.35%
Number of Hedge Fund Holders: 31
Avidity Biosciences, Inc. (NASDAQ:RNA) is a biopharmaceutical company focusing on the innovative delivery of RNA therapeutics. The company employs its proprietary Antibody Oligonucleotide Conjugates (AOC) platform, which combines the targeting capabilities of monoclonal antibodies with the precision of oligonucleotide therapies.
Due to the platform, the company is able to deliver treatments directly to challenging tissues, addressing the underlying causes of various diseases. Currently, the company is concentrating on rare muscle disorders, with ongoing clinical programs for conditions such as myotonic dystrophy type 1 (DM1), facioscapulohumeral muscular dystrophy (FSHD), and Duchenne muscular dystrophy (DMD).
In Q2, 31 hedge funds had investments in Avidity Biosciences (NASDAQ:RNA), with positions worth $991.516 million. VenBio Select Advisor is the top investor in the company as of Q2 and has a stake worth $265.729 million.
It showed encouraging results as it posted a GAAP EPS of -$0.65 in Q2, which exceeded analyst expectations by $0.14. The company also generated revenue of $2.05 million.
A notable development came in June when the company launched the global Phase 3 HARBOR trial for del-desiran, targeting DM1. This trial is a significant step forward, especially following the FDA’s Breakthrough Therapy designation granted in May 2024, which recognizes the potential of del-desiran to provide substantial benefits over existing treatments.
The company is also advancing its efforts with del-brax (AOC 1020), targeting FSHD. It plans to advance the initiation of registrational cohorts after reporting remarkable reductions in DUX4 regulated genes, alongside trends showing functional improvements and a favorable safety profile in participants. Such results highlight the platform’s capability to address genetic disorders effectively.
Additionally, Avidity Biosciences’ (NASDAQ:RNA) del-zota is undergoing a Phase 1/2 trial known as EXPLORE44, which has demonstrated significant improvements in dystrophin production and exon 44 skipping in DMD patients.
The company is expanding its focus to neuromuscular diseases. The company plans to broaden its horizons by introducing its first target from a precision cardiology pipeline in the fourth quarter of 2024. The expansion shows its focus on addressing multiple serious health conditions and diversifying its therapeutic offerings.
11 analysts have given Avidity Biosciences (NASDAQ:RNA) a Buy rating. As of September 24, the average price target of $61.50 has an upside of 39.77% to the stock’s current price. It ranks 3rd on our list of the best performing long term stocks in 2024.
Overall, RNA ranks 3rd on our list of the best performing long-term stocks in 2024. While we acknowledge the potential of RNA as an investment, our conviction lies in the belief that 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 RNA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
Read Next: $30 Trillion Opportunity: 15 Best Humanoid Robot Stocks to Buy According to Morgan Stanley and Jim Cramer Says NVIDIA ‘Has Become A Wasteland’.
Disclosure: None. This article is originally published at Insider Monkey.