Are You Backing The Right Horse With Corbus Pharmaceuticals Holdings Inc (NASDAQ:CRBP)?

Corbus Pharmaceuticals Holdings Inc (NASDAQ:CRBP), a US$428.15M small-cap, is a healthcare company operating in an industry, which has experienced tailwinds from issues such as higher demand driven by an aging population and the increasing prevalence of diseases and comorbidities. The demand for new drug development to meet new or persistent chronic illnesses, as well as the ongoing need for biotech drugs as Baby Boomers continue to age, are growth drivers for the optimistic outlook for the biotech industry in the long run. Healthcare analysts are forecasting for the entire industry, a fairly unexciting growth rate of 7.24% in the upcoming year , and a massive growth of 32.56% over the next couple of years. Not surprisingly, this rate is more than double the growth rate of the US stock market as a whole. Should your portfolio be overweight in the biotech sector at the moment? Below, I will examine the sector growth prospects, and also determine whether Corbus Pharmaceuticals Holdings is a laggard or leader relative to its healthcare sector peers. Check out our latest analysis for Corbus Pharmaceuticals Holdings

What’s the catalyst for Corbus Pharmaceuticals Holdings's sector growth?

Data analytics and other technology-enabled approaches are creating opportunities for innovations, however, stakeholders have been challenged to keep abreast of this structural shift while under pressure to cut costs. Over the past year, the industry saw growth in the teens, beating the US market growth of 9.97%. Corbus Pharmaceuticals Holdings lags the pack with its negative growth rate of -62.03% over the past year, which indicates the company will be growing at a slower pace than its biotech peers. Moreover, the trend of below-industry growth rate is expected to continue in the future with Corbus Pharmaceuticals Holdings poised to deliver a -20.76% growth compared to the industry average growth rate of 7.24%. As an industry laggard, Corbus Pharmaceuticals Holdings may be a cheaper stock relative to its peers.

Is Corbus Pharmaceuticals Holdings and the sector relatively cheap?

Biotech companies are typically trading at a PE of 28.46x, higher than the rest of the US stock market PE of 18.95x. This means the industry, on average, is relatively overvalued compared to the wider market. However, the industry did return a higher 16.36% compared to the market’s 10.35%, which may be indicative of past tailwinds. Since Corbus Pharmaceuticals Holdings’s earnings doesn’t seem to reflect its true value, its PE ratio isn’t very useful. A loose alternative to gauge Corbus Pharmaceuticals Holdings’s value is to assume the stock should be relatively in-line with its industry.

Next Steps:

Corbus Pharmaceuticals Holdings is a biotech industry laggard in terms of its future growth outlook. If Corbus Pharmaceuticals Holdings has been on your watchlist for a while, now may be a good time to dig deeper into the stock. Although its growth is expected to be lower than its healthcare peers in the near term, the market may be pessimistic on the stock, leading to a potential undervaluation. However, before you make a decision on the stock, I suggest you look at Corbus Pharmaceuticals Holdings's fundamentals in order to build a holistic investment thesis.

• 1. Financial Health: Does it have a healthy balance sheet? Take a look at our free balance sheet analysis with six simple checks on key factors like leverage and risk.
• 2. Historical Track Record: What has CRBP's performance been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
• 3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Corbus Pharmaceuticals Holdings? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!

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Simply Wall St analyst Simply Wall St and Simply Wall St have no position in any of the companies mentioned. This article is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.