We recently published a list of 10 Best Multibagger Stocks To Buy Heading into 2025. In this article, we are going to take a look at where Mind Medicine (MindMed) Inc. (NASDAQ:MNMD) stands against other best multibagger stocks.
November has been an eventful month so far for the market as the Fed cut rates by a quarter percentage and president-elect, Donald Trump won the election for the second time. The market reacted positively to these events as the major indices touched all-time highs and even Bitcoin finally broke off its shell after many months, reaching an all-time high of $93,000.
More recently, Federal Reserve Chair Jerome Powell stated that solid economic growth, low unemployment, and inflation above 2% mean there’s no urgency to cut interest rates. Speaking in Dallas, Powell said inflation is on a path toward the Fed’s 2% target, allowing for cautious policy adjustments.
He highlighted the economy’s strong fundamentals but acknowledged persistent inflation pressures. While a rate cut is expected by the market in December, it anticipates fewer cuts next year due to steady inflation and policy uncertainties. According to the CME FedWatch, 62.4% of the interest rate traders expect a 25 bps rate cut in December. However, in January, 55.5% of the market anticipates the rates to remain the same after the December cut.
Powell emphasized that the Fed will monitor inflation closely, especially housing costs, as it aims to reach its target sustainably.
READ ALSO: 12 High Growth Large Cap Stocks to Buy Now and 10 Best Low Volatility Stocks to Invest in Now.
Election Boosts Market Optimism but Risks Remain
Stuart Kaiser, Citi’s head of equity trading strategy recently joined CNBC’s Closing Bell. In the post-election discussion, Kaiser expressed a generally optimistic outlook, with confidence that the markets have cleared the immediate uncertainties related to the election. Kaiser noted a temporary boost from this event but emphasized that moving forward, market focus will return to U.S. economic growth, the Fed’s actions, and corporate earnings.
While he believes valuations are currently more justifiable with expected growth from deregulation and new policy changes, he remains cautious about risks tied to bond market movements and rising yields. He suggested that rising yields linked to economic growth are manageable for equities, but warned against yields climbing due to fiscal or tariff issues, which could unsettle the market.
Regarding equity strategy, Kaiser advocated a cautious approach to small-cap investments, preferring high-quality, profitable small caps due to their domestic focus, which could shield them from trade policy risks impacting larger companies. Additionally, although Kaiser doesn’t handle non-traditional assets directly, he acknowledged that assets like Bitcoin might gain traction in a strong economic or supportive policy environment.
A biopharmaceutical researcher proficiently using laboratory instruments.
Our Methodology
For this article, we used the Finviz stock screener to identify over 350 stocks with share price gains of over 100% in the last 12 months, as of November 13. Next, we narrowed our list to 28 stocks with share price gains of 200% either in the last 12 or 24 months and Buy or better ratings from analysts. From that list, we removed the stocks that had negative share price returns compared to 24 months ago and finally narrowed the list to 10 stocks with an average analyst price target upside of over 100%. The 10 best multi-bagger stocks are listed in ascending order of their average price target upside.
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).
Mind Medicine (MindMed) Inc. (NASDAQ:MNMD)
1-Year Share Price Performance: ~250%
2-Year Share Price Performance: ~195%
Average Price Target Upside: 146.77%
Mind Medicine (MindMed) Inc. (NASDAQ:MNMD) is a clinical-stage biopharma company focused on creating new treatments for brain health disorders. Aiming to lead in this field, it is developing a range of product candidates that influence key neurotransmitter pathways, some with and some without perceptual effects. It is working to address brain health challenges with its pipeline, designed to improve patient outcomes in challenging neurological conditions.
The company shared its third-quarter 2024 financial results and updates on its clinical programs on November 7. The company is preparing for its first Phase 3 trial, Voyage, to evaluate MM120 ODT, a form of lysergide D-tartrate (LSD), for generalized anxiety disorder (GAD) by late 2024, with a second GAD trial, Panorama, planned for 2025.
It also plans to launch Emerge, its first Phase 3 trial of MM120 ODT for major depressive disorder (MDD), in early 2025. The company anticipates initial data from these GAD and MDD trials in 2026.
MindMed (NASDAQ:MNMD) is also progressing with MM402, a modified form of MDMA aimed at treating autism spectrum disorder (ASD). Following a Phase 1 study completed in October 2024, further studies are planned to assess MM402’s potential for reducing ASD symptoms. MM120 is designated a breakthrough therapy by the FDA for GAD due to high unmet needs, especially in treatment-resistant cases.
As of September 30, 2024, the company held $295.3 million in cash and cash equivalents, up from $99.7 million at the end of 2023. The company expects this cash to fund operations through at least 2027, extending over a year beyond its anticipated first Phase 3 data readout for MM120 ODT in GAD.
Overall, MNMD ranks 4th on our list of best multibagger stocks to buy heading into 2025. While we acknowledge the potential of MNMD 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 time frame. If you are looking for an AI stock that is more promising than MNMD 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 is originally published at Insider Monkey.