Several biotech stocks have been showing strong action in the stock market recently, underscored by their place on the IBD 50 elite list of growth stocks. Some biotech exchange traded funds are also reflecting that strength. The iShares Biotech ETF (IBB) is at its highest since March, and the SPDR S&P Biotech ETF (XBI) has climbed back above its 200-day line for the first time since December.
The biotech group has also risen to 16th place among Investor's Business Daily's 197 industry groups. In the IBD 50, Arcutis Biotherapeutics (ARQT) is in a 21-week-long consolidation that has a buy point of 17.75, according to IBD MarketSurge. Arcutis makes treatments for skin diseases. In May, it won approval from the U.S. Food and Drug Administration for its treatment for an autoimmune condition in adults and adolescents older than 12 that leads to skin patches.
The company is yet to turn profitable, but it has been reporting smaller losses in recent years. In the second quarter ended June 30, a loss of 13 cents per share showed an improvement from a year earlier when Arcutis lost 42 cents per share. Sales shot up by 164% to $81.5 million.
Shares are in an early stage base-on-base pattern. The Relative Strength Rating shows that shares have outperformed 89% of other stocks in the IBD database. Mutual funds own 81% of outstanding shares. More funds have been buying the stock in the recent six quarters. Arcutis's Accumulation/Distribution Rating of B- also indicates institutions have been buying the stock in the recent 13 weeks.
Also in the biotech/biomed group, Tarsus Pharmaceuticals (TARS) gapped up to build the right side of its cup base following second-quarter results on Aug. 7. Shares are testing a buy point of 53.89. Tarsus makes treatments for eye conditions caused by parasites infesting the eyelashes. The company reported a loss of 48 cents per share, but sales grew 152% to $102.7 million. Analysts see the company turning profitable in 2026 with earnings of $1.03 per share. The relative strength line has risen sharply and shows the stock is outperforming the S&P 500.
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Mutual funds own 80% of outstanding Tarsus shares. More funds have been buying shares of Tarsus Pharmaceuticals over the past seven quarters. In the Investor's Business Daily mutual fund index, the Lord Abbett Developing Growth Fund (LAGWX) holds shares of Tarsus Pharmaceuticals.
BeOne Medicines (ONC) is just outside of a buy zone, above a buy point of 287.88. Shares pulled back after second-quarter results on Aug. 6, but rebounded this week. Earnings soared 923% to $2.25 per share while sales grew 42% to $1.3 billion.
BeOne sells cancer treatments and it raised its full-year midpoint sales guidance to $5.2 billion, up from $5.1 billion. Analysts see earnings rising 158% to $2.09 per share in 2025, and by 175% to $5.74 per share in 2026.
Mutual funds own 30% of outstanding shares. In the IBD mutual fund index, the Fidelity Contrafund (FCNTX) holds shares of BeOne Medicines stock.
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Medpace Holdings (MEDP) is near a buy point of 459.77 after an earnings-fueled surge on July 22. Earnings grew 13% to $3.10 per share in the second quarter, while sales rose 14% to $603.3 million. Mutual funds hold 63% of outstanding shares.
Medpace provides clinical development technology and support for biotechnology, pharmaceutical and medical device companies. It heads the medical research equipment and services group, according to IBD Stock Checkup. The stock holds a Relative Strength Rating of 92, while its Composite Rating of 94 and EPS Rating of 96 are also impressive.
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