It’s typically not too difficult to find a company that should perform well for the next couple of years. Two years isn’t very long, after all, and the stock market’s dynamics tend to dictate performance more.
Identifying a stock that’s likely to lead a marketwide charge for a decade is a different story. The organization in question must be able to offer something that’s not only marketable for a long while, but also no other outfit can mimic. Such companies are relatively rare.
There is one such stock to consider buying into sooner rather than later, though. That’s a biotech company called Recursion Pharmaceuticals (NASDAQ: RXRX). And you can still plug into the ticker at a nice discount.
Never heard of it? It would be a bit surprising if you had. Its market cap is a mere $3 billion, and it only did $58 million worth of business last year. And like many other young players in the biotechnology business, this one’s also still booking sizable losses, adding to investors’ general disinterest.
What this company lacks in size and profits, though, it more than makes up for in potential.
Just as the “Pharmaceuticals” in its name suggests, Recursion is a drug developer — chiefly of therapies for more complicated (and expensive) ailments. For instance, its candidate REC-617 is being tested as a treatment for a number of difficult-to-treat solid tumors. REC-994 is being developed as a therapy for a condition called cerebral cavernous malformation, which can cause bleeding in the brain. Although both are in early-stage trials, given the lack of real alternatives, hopes for them and for the company’s eight other pipeline candidates are high.
It’s not the drugs, however, that make Recursion such a compelling investment prospect. Rather, it’s how these drugs were designed. The company is using its own proprietary artificial intelligence (AI) platform — called Recursion OS — to predesign and pretest these treatments, to determine the odds of success before committing time and money to a project.
More importantly for interested investors, Recursion is now essentially sharing revenue-bearing access to this powerful software with other drug companies, creating a massive opportunity that’s just now beginning to gel.
It’s not just an interesting business idea, to be clear. Major pharmaceutical names like Roche Holding, Bayer, Germany’s Merck KGaA, Sanofi, and Rallybio are all on board, using Recursion OS to develop some of their next drugs.
