A Legitimate Way To Make 5x To 10x Over the Next 12 To 36 Months
The markets are closed today in observance of Good Friday, so we won’t be publishing Porter’s Daily Journal as usual. We’ll resume our normal publishing schedule on Monday. In the meantime, we’re sharing a special message from Porter detailing his favorite investment idea from our exclusive Porter & Co. annual conference. Though it’s from last fall, it’s particularly relevant today.
Here’s Porter…
I’m not sure the audience fully realized the value of the presentation.
But, as my wife and I watched along with the rest of the audience, Erez Kalir – who has worked alongside and on behalf of some of the greatest investors of all time, such as Julian H. Robertson – described a simple series of events that will create more than $1 billion in wealth. Most likely, far, far more than $1 billion in wealth.
Erez is extraordinarily intelligent. He’s very precise with his words and is soft-spoken, much like Marty Fridson, the lead analyst on Porter & Co.’s Distressed Investing. He doesn’t have the showmanship or the voice of a “carnival barker” (like I do, lol)… and so I worry that most people, even most people who were listening intently, will not understand the incredible impact of his presentation.
I hope you won’t make that mistake.
The Porter & Co. conference was an incredible experience.
In a quiet, bucolic setting – my own small farm outside Baltimore – a group of about 200 high-net-worth investors met and mingled with each other and a collection of world-class thinkers, including economist and futurist George Gilder, Dave Lashmet from Stansberry Research, wealth manager Austin Root (who like Erez is another Tiger Management alum), and Marty and Erez.
Collectively, these friends of mine have successfully managed tens of billions for decades.
Our guests also got to meet a handful of emerging investment geniuses, like Compounding Quality founder Pieter Slegers and the enormously popular (and secretive) energy expert Doomberg.
But, out of all of the presentations, there’s one I would beg you to review as many times as it takes for the message to sink in.
Erez, in his deliberate, plain-spoken way, talked about a legitimate way to make 5x to 10x on a portion of your portfolio over the next 12 to 36 months. The catalysts he described in these stocks are now in place to create a once-in-a-lifetime opportunity that investors should not ignore.
In my mind, Erez’s presentation was, by far, the best of the conference. So, I’m going to tell you all about it. And I’ll even give you the catalysts…
Erez explained why now is the best opportunity in almost 15 years to make huge, life-changing returns as a biotech investor.
As my friend and mentor, Dr. Steve Sjuggerud, taught me at the beginning of my career in the 1990s and as he famously taught True Wealth subscribers over two decades, “investors only need one biotech bull market to achieve generational wealth.”
There have been three of these massive biotech bull markets since October 14, 1980, when Genentech became the first biotech company to do an IPO.
And, I want you to notice something about all – every single one – of these massive biotech rallies. They all happen exactly the same way…
Following the market crash in 1987, tech stocks rallied for an entire year. But, biotech didn’t budge. Then, in November 1988, just about a year after the rally began in the rest of the market, biotech began one of the biggest market moves in stock market history. Powered mostly by Amgen (AMGN), biotech stocks rose almost 1,000% (958%) over the next four years.
Do you remember the Netscape IPO on August 9, 1995? At the last minute, the underwriters doubled the offering price from $14 to $28. It didn’t matter to investors, who bid the stock up to $58 on its first day, creating $3 billion in wealth. Tech stocks of all kinds – software, hardware, peripherals – went on to boom for the next five years. But biotech? It was flat for the entire first year of this incredible run. Biotech didn’t begin to move until a year after the Netscape IPO. But from July 1996 until March 2000, it led the markets with an 800% return, far outpacing the Nasdaq.
Can you see this pattern…?
It happened again, in the summer of 2010. That was a little more than one year after the broader market bottomed following the Great Financial Crisis. Tech stocks bottomed in March 2009. And they rallied strongly for just over a year before, once again, biotech began to rally, gaining more than 400% by the summer of 2015.
Keep in mind, these are index results measured by Datastream’s U.S. Biotech Index. That’s a broad, market-cap weighted index. It mainly tracks the gains of the largest biotech companies. Inside these rallies, smaller companies produced vastly larger results, with many companies producing 5x, 10x, and even 20x returns.
As one (of many) examples, shares of Illumina (ILMN), a biotech equipment maker that Stansberry Research’s Dave Lashmet had been recommending since its IPO in 2001, went from $30 to $190 in the 2010 to 2015 rally, more than a 500% return. And, of course, biotech companies with valuable drug candidates can produce even bigger gains. Regeneron Pharmaceuticals (REGN), which many longtime subscribers will remember we recommended in the early 2000s, traded up from $22 in the summer of 2010 to over $500 by the summer of 2015. That’s an increase of 22x – that’s a life-changing investment.
These enormous moves in biotech follow big gains in other tech sectors. That makes spotting these trends much easier to recognize.
And, right now, a new major biotech bull market is forming.
For a variety of economic reasons (the COVID bubble, the huge inflation that followed, the increase in interest rates to fight it, etc.) biotech has not participated in the recent tech rally. And, as a result, I cannot recall a wider gap, ever, between the performance of technology stocks and biotech stocks. The chart below tells the story.
QQQ, representing the top 100 companies in the Nasdaq Composite Index, is up 107% over the past five years. But ALPS Medical Breakthroughs ETF (SBIO), a collection of small-cap biotech innovators, is down 30% over that same period.
This huge gap in performance will not last.
We believe, especially because of a slowing economy, softening levels of inflation, and the potential for lower interest rates, that biotech stocks are poised to soar. The catalysts for each company will be unique, and there are dozens of well-financed, small-cap biotech companies that should take off in the months ahead.
That’s why, in January 2024, Porter & Co. launched our own proprietary biotech research service called Biotech Frontiers. And, just like we did when we partnered with the best distressed-debt investor in the entire history of those markets, Marty Fridson, we recruited a world-class biotech investor to join our team, Erez Kalir.
Erez has spent a lifetime studying and working in biotech and related fields, first at Stanford University, then, as a Rhodes Scholar at Oxford University, then at famed hedge fund Tiger Management, and most recently, for the last six years, as a biotech angel investor in Silicon Valley. Erez has known many of the best entrepreneurs and scientists in biotech since college and graduate school and has invested in the sector for more than two decades.
After some big early gains, like 87% on Kodiak Sciences (KOD), Erez decided to close nine of his first dozen recommendations last spring, earning average returns of more than 20% in only about three months.
Since then he’s closed out five more winning positions – including gains of 131% and 237% on uniQure (QURE) – with just one loss. And his seven current open positions continue to perform well, with average returns of around 15%, and one big winner that’s up 110%. And bear in mind… this is during the worst biotech bear market in history.
But as Erez explained at the conference, stocks in his portfolio are poised to produce truly massive gains in the months ahead because of a series of upcoming catalysts, including:
- A tiny company with a new, promising drug to treat MASH, a progressive liver condition that can lead to cirrhosis, whose closest competitor is valued in the billions of dollars, which has indicated it will be entering a game-changing partnership with a strategic Big Pharma partner in the next six to nine months.
- A company with patent litigation pending against Big Pharma giants Pfizer (PFE) and Moderna (MRNA) for their COVID-19 vaccine-delivery technology, which has won important early rulings in its favor, and may benefit from a multibillion-dollar settlement over the next year.
- A company trading for less than one half of its net cash that will be submitting a New Drug Application to the FDA later this year for a potential blockbuster, with an approval potential six to nine months later.
- A company that has the first disease-altering gene therapy for Huntington’s disease, a terrible neurodegenerative illness, that will release additional market-moving clinical-trial data in mid-2025.
And what is to me the most interesting opportunity: a chance to invest alongside the Elon Musk of biotech. One company in Erez’s portfolio has a legendary genius CEO, who is also the largest shareholder. He has a compensation structure that could earn him a $25 million bonus – but only if he increases the company’s market capitalization to $10 billion by 2026, which would represent a tripling in value from where it is today.
I understand that investing in biotech isn’t for everyone. But here’s the thing, over the next year or two, you’re going to be reading in these pages that these exact catalysts mentioned above have sent these stocks soaring 2x, 3x, 5x… or even 10x their current values.
And there’s no reason that you can’t participate. It’s easy: one of the best biotech investors in the world, Erez Kalir will show you exactly what to do. But, please understand. Erez isn’t going to shout anything from the rooftops. He will, undoubtedly, complain about me sharing his accomplishment and his credentials with you in this way. He believes producing great results is enough. But I know, it’s easy to miss these opportunities unless someone says “you absolutely must recognize what’s happening here, right now.”
So, I’m trying my best to get you to see what I see in this opportunity. And I want to give you every possible reason to join Erez in making what we both believe will be life-changing investments. My advice is simple. Even if you only invest $1,000 in each of these companies, allocate some of your equity exposure into the early stages of this biotech bull market. You simply won’t believe what is going to happen over the next one to three years.
Try not to cherry pick, and it makes sense to put the same amount of capital in each idea, because you can never know which will be the biggest winners.
But what I believe you can count on is that some of these stocks will be among the very best investments you will ever make, in your entire life.
Like it or not, I’ll keep track of the results here. So, if you’re not in these deals, you’re going to absolutely kick yourself.
Porter Stansberry
Stevenson, MD
P.S. I originally wrote this piece last September… and Erez has already delivered phenomenal results, just as I predicted.
You likely missed that opportunity – frankly, most of our readers did – but you don’t have to miss this one.
Because believe it or not, Erez says the opportunity in biotech stocks is even better today than it was when he first shared these ideas…
You see, the recent broad market turmoil has occurred on top of what has already been a brutal, three-year bear market in biotech.
Many biotech stocks are now down up to 95% from their prior highs. Yet, the same massive potential upside catalysts remain.
This has set up what Erez believes is a once-in-a-generation opportunity in the sector – something he doubts we’ll see again in our lifetimes.That’s why we asked Erez to sit down with our CEO Jared Kelly to show our readers exactly how to capitalize on this opportunity… including the 10 companies he’s most excited about today. You can watch this must-see interview right here.