MannKind Corporation (NASDAQ: MNKD)
If you follow CNA Finance or my writing elsewhere, you probably already know that MannKind is and has been one of my favorite biotech stocks for quite some time. While I may have gotten a bit of backlash for my opinion on MNKD in the past; it’s clear that recently, investors are catching on to the fact that this stock is destined for growth. However, with a run like what we’ve seen recently, investors may be afraid to jump into the fray. After all, no one wants to buy high. Nonetheless, I’m here to tell you that there’s still time to get in on the gains. Here’s why…
Why MannKind Stock Is Climbing
To get a feel for whether or not the bull run is going to last, it’s important to figure out why it started in the first place. In this particular case, that’s not a hard question to answer. MannKind had been on a downtrend for a few months following a Goldman Sachs downgrade based on their inhaled insulin, Afrezza. However, a few weeks back, Jefferies released the results of a survey in which it found that 65% of endocrinologists not only know about MannKind and Afrezza, but intend on using Afrezza more in the future. As a result, investors got excited; now seeing Afrezza as a way to realize a profit from investing in MNKD.
Why The MNKD Climb Is Likely To Last
As all investors know, price movement in the market is a series of overreactions leading to uptrends and downtrends. With that said, one of the biggest questions revolving around MNKD is, “How long will the climb last?” In my personal opinion, I think we’re seeing the beginning of a long term bullish run. Here’s why…
- Afrezza Sales Will Climb – While analysts were concerned about Afrezza in the past, it’s important to note that all we’ve seen from the inhaled insulin has been a soft launch. There has been no advertising and no strong push to get the insulin to the market…YET! Nonetheless, endocrinologists know about it, and more importantly, intend on using it in the future. This is bound to produce long run gains!
- Technosphere – Technosphere is the technology that MannKind used to turn the injection only insulin into an inhaled powder. More importantly, the company has made it clear that they are in the process of testing whether or not Technosphere can be effective in delivering other injection only medications; and chances are that the answer will be yes!Also, the company has made it clear that they have no intentions of licensing this technology out. So, Technosphere profits will all be for MannKind and its investors.
- Management – Finally, when it comes to MannKind, one of the big arguments against the stock has revolved around management. While the bears may say that the management is disorganized; I have to say the opposite. As a matter of fact, I’m actually impressed with MNKD management; and with the addition of Dr. James S. Shannon to the board of directors, it recently became stronger.
Keeping all of these factors in mind, it’s hard for me to imagine a scenario where MNKD is likely to fall for a long term period of time. In the long run, I think more gains are to come.
What Do You Think?
Where do you think MNKD is headed and why? Let us know in the comments below!