The selloff of Puma Biotechnology is an overreaction, said RBC Capital Markets' Michael Yee on Monday.
Puma's stock fell 13 percent to $169.97 on Monday. Investors were reacting to the release of phase three clinical trial data for the company's breast cancer drug, he said.
Yee, who is attending the American Society of Clinical Oncology conference, said on CNBC's "Power Lunch" that RBC Capital Markets was still defending the stock because it represents a long-term opportunity.
"The data looked as we expected," said Yee.
"We believe it's an overreaction and there is an event later this evening that we will follow up on and we think investors are probably going to come away from that feeling a little bit better after they present and go into some of the subgroup data later this evening"
Yee added that this has possibilities for the long run.
"We think longer term this is an opportunity," he said. "We think the stock moves higher over time."
Large companies are competing in the immuno-oncology market, explained Yee.
"There is a huge race to go after a $20 billion market," said Yee. "You are going to see this volatility."
Bristol-Myers Squibb is another stock that experienced some volatility after the announcement of trial results of its lung cancer drug Opdivo. The company's shares fell sharply Friday after the release of the results before bouncing back Monday to close up 2.9 percent to $66.48.