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Biotech ETF (XBI) Hits New 52-Week High

Sanghamitra Saha
Updated
Ross Stores (ROST) has an impressive earnings surprise history and currently possesses the right combination of the two key ingredients for a likely beat in its next quarterly report.

For investors seeking momentum, SPDR S&P Biotech ETF XBI is probably on radar now. The fund just hit a 52-week high and is up around 59.5% from its 52-week low price of $61.44/share.

But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea on where it might be headed:

XBI in Focus

This fund offers exposure to the S&P Biotechnology Select Industry Index which represents the biotechnology sub-industry portion of the S&P Total Markets Index. Bioverativ, MiMedx Group and Juno Therapeutics are top three holdings of the fund. It charges 35 basis points in annual fees (see all Health Care ETFs here).

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Why the Move?

Buyouts in the biotech space are in the spotlight currently. Celgene Corporation CELG buying Juno Therapeutics Inc JUNO for $9 billion and Sanofi SA (ADR) SNY buying Bioverativ Inc BIVV for $11.6 billion recently are probably pushing the space higher. Plus, the tax reform entails biotech companies to repatriate hundreds of billions of dollars stacked in the international economies. This extra cash may be used to buy back shares or pay out dividends in the coming days.

More Gains Ahead?

Currently, XBI has a Zacks ETF Rank #2 (Buy) with a High risk outlook, suggesting that the outperformance could continue in the months ahead.

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Sanofi (SNY) : Free Stock Analysis Report
 
SPDR-SP BIOTECH (XBI): ETF Research Reports
 
Celgene Corporation (CELG) : Free Stock Analysis Report
 
Juno Therapeutics, Inc. (JUNO) : Free Stock Analysis Report
 
BIOVERATIV INC (BIVV) : Free Stock Analysis Report
 
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Zacks Investment Research
 
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