Sangamo Biosciences (NASDAQ: SGMO) has grown through strategic partnerships with companies such as Dow Chemical Corporation (NYSE: DOW) and others while margins have remained attractive compared to companies like Amgen, Inc. (NASDAQ: AMGN)
With the unprecedented global surge in diseases such as HIV/AIDS, medical science is constantly searching for cures, or at the very least, palliative solutions. It is primarily in the biosciences sector of the market that companies are engaged in this type of research. A few of the companies command attention, and Sangamo Biosciences (NASDAQ: SGMO) is among them. The company has just announced its fourth quarter and 2012 full-year results and the numbers look pretty decent.
Sangamo Biosciences had a good outing in 2012 and its fourth quarter numbers reflect this. The stock grew by around 45 percent over the past year driven, in part, by the increase in its collaborative agreements. Revenues for fourth quarter 2012 were $8.9 million. This was up from $4.7 million the company posted in the same quarter in 2011. Revenues grew through the company's strategic partnerships with Shire PLC, Dow Chemical Corporation's (NASDAQ: DOW) AgroSciences segment, Sigma-Aldrich Corporation and other research grants. Total operating expenses were $43.9 million for 2012 versus $46.1 million in 2011. Sangamo Biosciences has a market capitalization of around $480 million and shares are trading at $9.05 as of today's market, very near to its 52-week high of $10.05. And if you need more encouragement to put the company on your watch list, it has a gross margin of 1.00, which is above the industry average. It is also attractive compared to the figures of some of its larger competitors. For instance, Amgen Inc (NASDAQ: AMGN) has a gross margin of 0.84 while Eli Lilly and Company has a gross margin of 0.79.
The company has high hopes for the future. It projects that its cash, cash equivalents, and marketable securities will reach $55 million by the end of 2013. Sangamo expects that revenues will be in the range of $20 to $24 million this year, inclusive of research funding from Shire. The company also expects that operating expenses will be in the range of $46 to $50 million for 2013.
Sangamo Biosciences focuses on developing proteins for gene regulation and genome editing. For instance, it is currently evaluating the possibility of using therapeutic gene regulation for the management of illnesses such as HIV/AIDS, hemophilia, and sickle cell anemia. Sangamo's technique entails manipulating DNA-binding proteins for gene modification. The process promotes gene expression and controls cell function. Management is excited by progress of the company's ZFP Therapeutics in the treatment of diseases. Data was presented at the American Society of Hematology meeting showing the successful use of its protein replacement platform. Sangmo also demonstrated that its gene regulation techniques can repress the form causing the huntingtin gene (HTT) which is associated with Huntington's disease.
The company is actively establishing working partnerships with firms that are interested in the non-therapeutic use of its technology. This explains its partnership with Dow AgroSciences and Sigma-Aldrich Corporation. As a result of the progress the company made in 2012, it was put on the Russell Best Performing Stock list. Sangmo does bear watching over the next few quarters. It may prove very profitable in the long-run.
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