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The stock market is incredibly diverse, with almost unlimited options for ISA Shares and Shares. For brave investors willing to swing the fence, here are two high-risk, high-reward ideas to consider.
Genetic programming
First is a biotech company Crispr Therapeutics (NASDAQ: CRSP) that developed the Nobel Prize-winning CRISPR/Cas9 technology to sequence genes.
Last year, it received its first treatment, Casgevy, approved for sickle cell disease and beta-thalassemia, rare blood disorders that often debilitate sufferers.
Crispr Therapeutics and partners Vertex Pharmaceuticals have begun collecting cells from 50 patients. These will be processed outside the body and returned to the patient for treatment. The NHS is currently launching Casgevy.
Looking ahead, the two companies have served approximately 58,000 patients in the US, Europe and the Middle East. With a cost of about $2.2m per patient, the revenue opportunity over the next few years could be in the multi-millions (Crispr will get 40% of sales and the rest will go to Vertex).
The company also has a promising candidate for gene editing in the clinic, as well as a potentially revolutionary treatment for type 1 diabetes aimed at restoring insulin production.
Naturally, the biotech is vulnerable to setbacks in these clinical trials. And given the company’s lack of revenue, never mind profits, the negative impact on the share price could be significant.
Still, the company had $1.9bn in cash late last year, enough to fund its exciting medical pipeline.
With the share price down 39% over one year, and the firm sporting a modest $1.5bn enterprise value, I think Crispr Therapeutics stock is worth considering.
Ready to go out?
The following is Archer Aviation (NYSE: ACHR), which is pursuing commercialization of electric vertical takeoff and landing (eVTOL) aircraft. These take off as straight as helicopters but are almost silent and very green, making them ideal for dense urban areas (Los Angeles, New York, Tokyo, Abu Dhabi, etc).
Archer aims to introduce a Uber-as an air taxi service and sell EV aircraft directly to third-party customers. For example, it has recently entered into a strategic partnership with Anduril Industries to develop hybrid aircraft for military applications (testing, for example, given how quiet they are).
Now, the thing here is that the company still does not have its plane, called Midnight, fully approved by the Federal Aviation Administration (FAA). It expects to achieve this by 2025, but there may be regulatory delays (or worse). So this stock is very speculative at this stage.
However, there are a few things I like here. First, Archer has nearly completed the third phase of the FAA’s four-phase certification process, while progressing through the final phase. And an air taxi service is set to launch in Abu Dhabi later this year.
Next, it recently completed construction of a high-volume, 400,000 sq ft manufacturing facility. With support from the car giant Stellantisaims to increase up to 650 flights per year by 2030. Archer’s current capitalization and order book now exceed $6bn.
Finally, Morgan Stanley estimates that the eVTOL market could top $1trn in 15 years! Archer Aviation’s market capitalization today is $4.3bn. At $8, I think the stock is worth considering for early stage investors.
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