Why Sarepta Therapeutics Inc. (SRPT) Crashed On Tuesday?

We recently published a list of 10 Firms Heavily Hit by Market Pessimism. In this article, we are going to take a look at where Sarepta Therapeutics Inc. (NASDAQ:SRPT) stands against other firms heavily hit by market pessimism.

Wall Street finished in the red territory on Tuesday, as investors repositioned their portfolios ahead of the Fed rate decision on Wednesday.

The Nasdaq dropped the highest among its peers, declining 1.71 percent. The S&P 500 followed with a 1.07-percent loss, while the Dow Jones decreased by 0.62 percent.

The market pessimism spilled over to various sectors, with 10 companies notably hit the most.

In this article, we have identified the 10 worst performers on Tuesday and detailed the reasons behind their drop.

To come up with the list, we only considered the stocks with a $2-billion market capitalization and $5 million in trading volume.

A laboratory technician in a white coat holding a microscope and examining a vial of biopharmaceuticals.

Sarepta Therapeutics Inc. (NASDAQ:SRPT)

Sarepta fell heavily by 27.44 percent on Tuesday to finish at $73.54 apiece as investors disposed of shares in the company following twin news of death associated with its treatment Elevidys.

On Tuesday, SRPT announced that a young patient succumbed to acute liver failure after receiving the Sarepta Elevidys therapy, the only FDA-approved gene therapy for Duchenne muscular dystrophy.

While the risk has already been flagged on the Elevidys label, acute liver injuries leading to death have not been previously reported in clinical testing or real-world use of Elevidys.

SRPT said that the patient had a recent cytomegalovirus (CMV) infection which allegedly contributed to the death. The infection can damage the liver, leading to CMV hepatitis, which is fatal to those with weak immune systems.

Overall, SRPT ranks 1st on our list of firms heavily hit by market pessimism. While we acknowledge the potential of SRPT 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 time frame. If you are looking for an AI stock that is as promising as SRPT but 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.