ACADIA Pharmaceuticals Inc. (NASDAQ:ACAD) Stock Hovers Around All-Time High: What to Do?

The turmoil in the markets brought about steep declines in many stocks across sectors, but ACADIA Pharmaceuticals Inc. (NASDAQ:ACAD) is one of the exceptions. The biotech firm has seen its stock gain as much as 16% in 2020 so far, and in such a situation, it could be worthwhile to take a closer look at Acadia.

Some Significant Breakthroughs

The company has had some significant breakthroughs in recent times. Its product Nuplazid (pimavanserin), which is meant to tackle psychosis related hallucinations, did well at the beginning of the year. On the other hand, last month, the company reported that its Q1 2020 revenue rose to $90.1 million, thereby recording a year on year rise of 43%.

It was clear that despite the $88 million net loss and the coronavirus pandemic, investors liked what saw from Acadia in the first quarter. The year on year volume growth stood at 32.1% in the first quarter. Due to Acadia’s decision to pivot to virtual education and engagement, yearly sales guidance has been reduced from $450 million to $420 million. However, that still represents a 28% year on year rise.

It seems that the company is also going to be able to deliver the second indication of Nuplazid for the treatment of dementia-related psychosis (DRP). It is a significant opportunity, considering the presence of 1.2 million such patients at last count.

One of the more important things to keep in mind about Acadia is the fact that the company has a long term vision in place. Due to the coronavirus related lockdowns, the company set up a virtual presence and also delivered medicines directly to patients. It has invested generously towards online tools, and that could continue to drive Acadia’s growth in the coming years. Last month, the company also received positive feedback from the United States FDA with regards to combining the Phase 3 clinical studies (CLARITY 1 and CALRITY 2) so as to test Nuplazid for major depressive disorder (MDD).

The company also reported $651.4 million in cash, and that places it in a good position to take care of its business during these troubled times. Experts believe investors could consider buying the stock after the next dip.

About Travis Garlick 1803 Articles
Been writing about and trading stocks since 2013. Manage a group of micro-cap investors on Facebook with over 15,000 members. Turned $8,500 into 185k the first year I started trading stocks and haven't looked back.