Dec 292017

top stock picks

Each year for 35 years, our editorial team has surveyed the nation’s leading newsletter advisors and investment experts asking for their favorite stocks for the year ahead, explains Kim Githler, Chair and CEO of MoneyShow.

This year’s report — Top Picks 2018 — begins on Monday, January 1st and features 100 investment ideas for the new year.

We would like to emphasize to our readers that these annual reports are not contests. The goal is not to compile a list of high risk, high-flyers (and potential big losers). Rather, each year we ask the leading advisors to provide you, our readers, with a shopping list of investment ideas for you to consider and research as you build your personal long-term portfolios.

Yes, each year’s Top Picks report includes a variety of fasting-growing stocks with high potential. But the report also includes many conservative dividend-paying stocks and blue chips chosen for safe and steady returns.

With that said, we would still like to highlight, and congratulate, some of last year’s best performers whose Top Picks for 2017 double, tripled and quadrupled the market averages over the past 12 months.

Biotechnology expert John McCamant deserves special recognition; his top pick from last year rose an astounding 519%. We’ve asked John, and all these other outstanding advisors, to share their updated opinions on these top performing stocks from last year’s Top Picks 2017 report.

John McCamant, The Medical Technology Stock Letter Madrigal Pharmaceuticals (MDGL) — up 519%
In 2017, Madrigal emerged as one of the leaders in drug development for the extremely large and untapped NASH market, a $35 billion opportunity.  NASH is one of the hottest sectors in drug development as large biopharma companies have inked a slew of huge licensing deals and acquisitions over the past few years.Madrigal has a first-in-class thyroid hormone receptor-β agonist, MGL-3196,which recently reported proof-of-concept (POC) data showing it can safely and significantly reduce liver fat in NASH patients.‘3196’s unique mechanism of action and safety profile gives it the potential to be a standalone NASH therapy, but should also be complementary to most other NASH mechanisms of action.

In our view, the recent positive Phase II NASH data has de-risked the HoFH data in January and the liver biopsy from the Phase II NASH trial in late April.

Madrigal is poised for two significant catalysts with the Phase II HeFH (heterozygous FH) data due in late January and the Phase II liver biopsy data in late April.

After the release of what we expect to be positive Phase II data in April, the company would have an end-of-Phase II meeting with the FDA and start the pivotal Phase III trial for ‘3196 in NASH in the last third of 2018.

Following the two expected positive Phase II readouts in HEFH and NASH, MDGL will have a slew of potential suitors for a huge partnership or premium buyout.  Both would be extremely lucrative for shareholders. Our confidence is very high in CEO Paul Friedman who has an excellent track record of leveraging positive Phase II data into shareholder value.

In our view, ‘3196 is the most attractive drug candidate for the treatment of NASH, a $35 billion market opportunity, and has the potential to be a best-in-class molecule.  This data significantly de-risks MDGL and ‘3196 in the upcoming Phase II trials. Madrigal is a buy under $100 with a target price of of $140.