Biotechnology stocks, slowly gaining favor on Wall Street for more than a year, have skyrocketed in the past few weeks amid particular enthusiasm for a group of companies that specialize in large-scale genetic analysis.

Like other technology stocks, those in the biotech sector have been buoyed by an end-of-the-year buying binge and by general enthusiasm for the potential of the "new economy."

But as a group they have outstripped gains even in technology-heavy market indexes, with some individual stocks quadrupling in value in two months. The Amex biotech index and the Nasdaq biotech index, baskets of stocks, have jumped 48 percent and 43 percent, respectively, since Nov. 1, compared with a gain of 37 percent for the tech-heavy Nasdaq 100 index. The biotech gains leave in the dust such broad barometers as the Standard & Poor's 500-stock index, up 7.6 percent since Nov. 1.

Leading the pack has been Celera Genomics Corp. of Rockville, a company that is working feverishly to compile a complete map of human genes. Several pieces of news this fall from the company and from competing researchers awakened investors to the likelihood that Celera will have such a map in hand by sometime next year, spurring faster progress in medicine.

"This is real, and it's big," said Winton G. Gibbons, an analyst at William Blair & Co. in Chicago who follows Celera. "I actually think that Celera has been a catalyst" for movement in the entire biotechnology sector. The company's stock has jumped from $38.93 3/4 to $159.75 since Nov. 1, a gain of 310 percent in 40 trading days.

The biotechnology industry, long on promise and short on delivery for much of its 20-year history, was the focus of speculative buying and wild run-ups in stock valuations during the early 1990s amid hope for ongoing tests of new drugs. But then a string of bad reports from those tests brought the party to an end, and burned investors avoided the group for years.

By last year, enough time had passed and enough hard scientific lessons had been learned that companies were managing to bring a string of new products to market. Some offered dramatic improvements in people's lives, such as new treatments to fight debilitating ailments such as rheumatoid arthritis and the bowel inflammation known as Crohn's disease.

Tremulously, investors started moving back into the sector, focusing first on the handful of top-shelf companies with products on the market and profit on the balance sheet. In recent months the rally has broadened, lifting some companies with solid near-term prospects but no marketed products.

"We've seen the action spread down into the second- and third-tier stocks," said Jim McCamant, editor of the Medical Technology Stock Letter in Berkeley, Calif. "Until recently, even when they got good news, they'd go up immediately and then give it back right away. That's changed."

Moreover, investors seem increasingly willing to analyze biotech stocks by subgroups. Hottest at the moment: companies such as Celera that specialize in large-scale analysis of the genes of entire organisms, including people. This practice of using big gene maps as a guide to medical progress is a relatively new discipline, and it is referred to as "genomics."

Celera has been in operation only since last year, but it is widely perceived to have taken the lead among private genomics companies. The company has built the largest gene-sequencing laboratory in the world. It is working closely with academic researchers to complete a gene map for the fruit fly, an important research organism, and is reporting rapid progress on human genes. Celera may well beat publicly funded researchers in publishing the first complete human gene map as early as next year.

Another company that has gained sharply in the recent rally is Human Genome Sciences Inc. of Rockville, the granddaddy of genomics companies. It has been working on large-scale gene analysis for years and has filed more than 7,000 patent applications on genes. The company's shares have jumped 48 percent since Nov. 1, to close at $138.87 1/2 yesterday.

Genomics has not been the only favored subgroup. Companies developing artificial antibodies that work in the human body like natural components of the immune system have seen their valuations soar as they have put successful products on the market.

A prime beneficiary has been MedImmune Inc. of Gaithersburg, which makes an antibody to combat a respiratory virus in children. MedImmune's shares have jumped 48 percent since Nov. 1, closing yesterday at $161.62 1/2.

The movement in biotech stocks has been so precipitous that many analysts are flashing a yellow light, warning long-term investors to weigh their moves carefully.

"There are a lot of parallels between genomics and the Internet," said Eric Schmidt, an analyst with S.G. Cowen Securities Corp. in New York. "Investors are willing to pay upfront premiums for companies that they think are going to command a dominant market share in the future."

The obvious danger now is that short-term momentum investors--those whose game is to buy high and sell higher--will drive biotech stocks to unsustainable levels. When an overvalued stock stalls, these investors tend to flee en masse with their gains, and sudden collapse can follow.

At a minimum, Schmidt and other analysts say, biotech investors should brace themselves for volatility. After the popular Motley Fool investor site on the World Wide Web highlighted Celera's prospects, the New York Stock Exchange had to suspend trading in the stock repeatedly over several days as buyers overwhelmed sellers and the price skyrocketed. It's not hard to imagine the stock falling just as suddenly.

"Certainly some caution needs to be exercised in markets like this," Schmidt said. "If you're already into these names, hang in for the ride, for sure."

CAPTION: Biotech Takes Off (This graphic was not available)