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Despite the FTSE 250 being up almost 12% over the past year, not all stocks within the index have followed suit. In fact, some have significantly underperformed in 2026, and for good reasons. Not all FTSE 250 stocks that are in the red are undervalued gems. Here’s one I’m not touching for the moment.
An August problem
I’m talking about Oxford Biomedica (LSE:OXB). The stock is down 30% over the past six months. And unfortunately, I think there are some fairly good reasons why investors have become nervous.
The biggest blow came last month. The cell and gene therapy manufacturing specialist slashed its 2026 revenue forecast from £220m-£240m to just £180m-£200m. That’s a sizeable downgrade, particularly given that the original guidance had only been reiterated earlier this year.
There wasn’t one single culprit. Some clients have deferred programmes or changed development timelines, while another large customer altered its procurement strategy. Meanwhile, operational readiness at Oxford Biomedica’s recently acquired Durham facility in North Carolina was delayed by around six months.
That combination concerns me. Contract development depends heavily on customers progressing drugs through clinical development. If programmes get delayed or cancelled, expected revenues can disappear surprisingly quickly.
Filtering down to the bottom line
The share price has moved lower not just from the sentiment shift, but ultimately because profit expectations have taken a hit too. Put another way, the value of the company has decreased given the potential for it to make less money in the coming year.
Cash is another figure I’d watch. Gross cash declined from £97m at the end of 2025 to £75m by June, while net cash dropped from £55m to £21m. That’s not disastrous, but continued investment combined with disappointing revenue conversion isn’t a combination I’d ignore.
Even though I’ve focused on the six-month performance, the longer-term view hasn’t been much better. The stock is down 20% in the past year, so it’s not just a short-term problem from this summer that has spooked investors.
The other side of the coin
So as I look ahead, I struggle to see many reasons to want to buy the FTSE 250 stock. Of course, I could be wrong and missing some supportive elements.
For example, first-half revenue still grew around 9% to £80m. In fact, it signed 17 new clients, over 30% more than it signed during the whole of 2025. That suggests the company is growing and demand from new customers is rising. This could allow it to project better financial figures next year if spending from these clients really picks up.
Ultimately, I think there are better stocks out there in the FTSE 250, either from a value or growth angle. Therefore, I’m not keen to buy now and think investors could consider steering clear.
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Jon Smith has no positions in the shares mentioned.
This story originally appeared on Motley Fool
