The Motley Fool

Synairgen share price fluctuations continue! Here’s what I’d do

Image source: Getty Images.

Synairgen (LSE:SNG) has yet again surprised the markets, as its share price continues to enjoy a fantastic 2020. The company issued £87m worth of new shares this week, and investors were snapping up them up with glee. By the end of Wednesday, the Synairgen share price had climbed 16% since the start of the week.

Cashing in on Covid-19

Synairgen is a pharmaceutical company specialising in respiratory drug development. Being in a prime position to help combat Covid-19, its share price has risen an astronomical 3,420% year-to-date. From January to April it had risen 1,360%. It then halved, but between July and November it’s risen a further 400%. Given the extreme volatility the share price has seen in this period, it’s clearly not a stock for the faint of heart. It doesn’t offer a dividend, and it’s listed on the notoriously erratic FTSE AIM index. 

5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!

According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…

And if you click here we’ll show you something that could be key to unlocking 5G’s full potential...

The company’s key selling point is its drug SNG001, which has proved effective in treating the more serious side effects of Covid-19. In particular, it markedly reduced breathlessness in patients who received SNG001 compared to those receiving a placebo.

For now, the drug is yet to be licensed, and is still in phase 2 of trials. But that’s not stopped the Synairgen share price rocketing as the company has signed deals with several global partners.

Is it all downhill from here?

Investors are rightly concerned that once the pandemic is under control, Synairgen profits will take a significant hit. But hope springs eternal. Many investors are counting on it making good progress in developing and marketing other drugs in its portfolio.

With its rise to prominence now established on the world stage, there’s no doubt it could continue to grow and prosper. Within the UK it is now a part of a collaborative body of experts in life sciences and progressive research. However, pharmaceuticals is a cut-throat industry, and I think it’s those with a biotech slant that will do the best in the years to come.

Synairgen is one such stock and as such I think it could do very well indeed. Of course, this does depend on how the pandemic evolves and how it progresses its other offerings. I think the Synairgen stock remains a risky buy, particularly at an inflated price point. Nevertheless, it’s down 30% from its summer high, so there could be room for further growth yet.

An acquisition target?

In another scenario, it may get snapped up by a bigger pharma player, particularly if it has the makings of drugs in demand. Severe asthma and COPD continue to plague children and the elderly around the world. The pandemic has highlighted the need for treatments.

Just a quick glance at Synairgen’s share price fluctuations year-to-date tells me this is in no way a safe and sure-fire investment. Still, I do think it’s got a lot going for it and if I owned it, I’d be holding for now.

Are you looking for growth prospects to boost your earning potential? Experts like The Motley Fool (and their exclusive reports) are here to boost your chances of making money through investing. Let them help you...

A Top Share with Enormous Growth Potential

Savvy investors like you won’t want to miss out on this timely opportunity…

Here’s your chance to discover exactly what has got our Motley Fool UK analyst all fired up about this ‘pure-play’ online business (yes, despite the pandemic!).

Not only does this company enjoy a dominant market-leading position…

But its capital-light, highly scalable business model has previously helped it deliver consistently high sales, astounding near-70% margins, and rising shareholder returns … in fact, in 2019 it returned a whopping £150m+ to shareholders in dividends and buybacks!

And here’s the really exciting part…

While COVID-19 may have thrown the company a curveball, management have acted swiftly to ensure this business is as well placed as it can be to ride out the current period of uncertainty… in fact, our analyst believes it should come roaring back to life, just as soon as normal economic activity resumes.

That’s why we think now could be the perfect time for you to start building your own stake in this exceptional business – especially given the shares look to be trading on a fairly undemanding valuation for the year to March 2021.

Click here to claim your copy of this special report now — and we’ll tell you the name of this Top Growth Share… free of charge!

Kirsteen has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Our 6 'Best Buys Now' Shares

The renowned analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.

So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we're offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our 'no quibbles' 30-day subscription fee refund guarantee.

Simply enter your email address below to discover how you can take advantage of this.

I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement.