Mitrade Insights is dedicated to providing investors with rich, timely and most valuable financial information to help investors grasp the market situation and find timely trading opportunities.

2021

Best News & Analysis Provider

FxDailyInfo

2022

Best Forex Educational Resources Global

International Business Magazine

Insights

News

The Biotech Stock That's Too Risky for Most Investors

Source The Motley Fool

Key Points

Recursion Pharmaceuticals is applying artificial intelligence to the drug discovery process.
Recursion has several cancer therapy candidates in early-stage clinical trials.
Drug trials often fail.
10 stocks we like better than Recursion Pharmaceuticals ›

The artificial intelligence (AI) revolution has the potential to alter just about every business operation for the better. One area where investors are extra excited about productivity improvements is the drug development business.

The vast majority of experimental drugs that enter clinical trials never become marketable products, but by applying AI to the discovery process, Recursion Pharmaceuticals (NASDAQ: RXRX) plans to become a top-performing biotech stock.

Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now. Continue »

A person smiles as they present data on a screen to colleagues.

Image source: Getty Images.

The handful of analysts following the stock seem to agree that AI-powered drug discovery could give the company an advantage. Among five analysts following the stock, none have a sell rating, and expectations are high. The average analyst following the company thinks the stock price can rise 53% from its closing price on Sep. 24, to $7.25 per share over the next 12 months.

So, investment bank analysts are convinced this is a good stock to buy, or at least worth holding. And the company sports a $2.1 billion market cap despite having no idea when it will start recording product sales. This indicates that everyday investors probably don't appreciate how much risk they're taking on with the shares.

Recursion's most advanced new drug candidate, REC-617, is in its first clinical trial. It's a novel CDK7 inhibitor that could become the first cancer treatment of its kind, if this study and subsequent trials succeed and approval is granted. Earlier this year, Recursion advanced REC-617 to the phase 2 portion of its ongoing study. Top-line results are expected in 2028.

Investors new to biotech need to remember that a majority of cancer drugs that pre-commercial companies advance from phase 1 to phase 2 clinical trials never earn approval or generate sales. Even if we assume AI-powered drug discovery allows Recursion to pick winners twice as often as its peers, there's still a very strong chance that its lead candidate will fail to generate any sales. For most investors, it's best to watch this stock's story play out from a safe distance.

Should you invest $1,000 in Recursion Pharmaceuticals right now?

Before you buy stock in Recursion Pharmaceuticals, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Recursion Pharmaceuticals wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $652,872!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,092,280!*

Now, it’s worth noting Stock Advisor’s total average return is 1,062% — a market-crushing outperformance compared to 189% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of September 22, 2025

Cory Renauer has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Disclaimer: For information purposes only. Past performance is not indicative of future results.

Recommended Articles

Fed hike odds near 90% into Wednesday's decision — how to trade the dollar, gold and the S&P 500 A 0.3% monthly core CPI print has lifted the market-implied probability of a 25bp Fed hike on 16 September to roughly 86.5% ~ 90%, which would be the first increase since July 2023. Here is the decision timeline, the pricing versus the forecasts, both scenarios, and the key levels for the dollar, gold and the S&P 500.

Author Suzie

Sep 14, Mon

A 0.3% monthly core CPI print has lifted the market-implied probability of a 25bp Fed hike on 16 September to roughly 86.5% ~ 90%, which would be the first increase since July 2023. Here is the decision timeline, the pricing versus the forecasts, both scenarios, and the key levels for the dollar, gold and the S&P 500.

【Daily Brief】10-year Treasury yield briefly tops 5%, S&P 500 slips to 7,602 and the dollar firms at 99.3 as the Fed's decision eve begins The 10-year Treasury yield touched 5.014% on Monday — its first print above 5% since October 2023 — while the S&P 500 closed 0.48% lower at 7,619.98 and the dollar index firmed to 99.3. Here is the full market wrap ahead of Wednesday's FOMC decision, the dot plot and the August retail sales report, plus today's CLARITY Act Senate vote.

Author Irene Q.

Sep 15, Tue

The 10-year Treasury yield touched 5.014% on Monday — its first print above 5% since October 2023 — while the S&P 500 closed 0.48% lower at 7,619.98 and the dollar index firmed to 99.3. Here is the full market wrap ahead of Wednesday's FOMC decision, the dot plot and the August retail sales report, plus today's CLARITY Act Senate vote.

Silver breaks $64 as precious metals rebound — can gold hold the $4,280 line into the Fed decision?Silver has climbed back above $64 an ounce for the first time this week, leading a broad rebound across precious metals hours before the Federal Reserve delivers what is expected to be its first rate hike since 2023. Spot silver was last at $64.64, up 1.49% on the day, while gold reclaimed $4,300 and platinum and palladium both advanced. The question now is whether the bounce is a genuine turn — or a pause before the Fed's dot plot decides the next move.

Author Suzie

Yesterday 08: 40

Silver has climbed back above $64 an ounce for the first time this week, leading a broad rebound across precious metals hours before the Federal Reserve delivers what is expected to be its first rate hike since 2023. Spot silver was last at $64.64, up 1.49% on the day, while gold reclaimed $4,300 and platinum and palladium both advanced. The question now is whether the bounce is a genuine turn — or a pause before the Fed's dot plot decides the next move.

Bitcoin falls below $75,000 as the CLARITY Act fails in the Senate — what the vote means for crypto The US Senate blocked the Digital Asset Market CLARITY Act in a 49-50 procedural vote, sending Bitcoin briefly below $75,000 — its biggest one-day drop since June. Ethereum fell more than 8%, Coinbase slid 10% and $75 billion of crypto market value evaporated. Here is what the vote was, why it failed, and the levels that matter now.

Author Suzie

Yesterday 08: 47

The US Senate blocked the Digital Asset Market CLARITY Act in a 49-50 procedural vote, sending Bitcoin briefly below $75,000 — its biggest one-day drop since June. Ethereum fell more than 8%, Coinbase slid 10% and $75 billion of crypto market value evaporated. Here is what the vote was, why it failed, and the levels that matter now.

Dollar index tops 100 for the first time since July as the Fed's hawkish dot plot sinks in The U.S. dollar index broke back above 100 for the first time since 31 July after the Fed delivered its first rate hike since 2023, with the dot plot showing 16 of 18 officials expect at least one more increase this year. Here are the levels that matter for DXY, the currencies feeling it most, and what to watch next.

Author Irene Q.

6 hours ago

The U.S. dollar index broke back above 100 for the first time since 31 July after the Fed delivered its first rate hike since 2023, with the dot plot showing 16 of 18 officials expect at least one more increase this year. Here are the levels that matter for DXY, the currencies feeling it most, and what to watch next.

Popular Symbols