The iShares Nasdaq Biotechnology ETF (NasdaqGS: IBB), the largest biotechnology exchange traded fund, is off 8.4% over the past week. While that is not the official definition of a correction, a 10% decline is needed for a security to enter correction territory, acute weakness in IBB and rival biotech ETFs has stoked bubble talk.

Consider this about the biotech bubble speculation: Google autofills “Biotech B” with “Biotech Bubble.”Search “biotech bubble” and Google returns almost 34,000 results in half a second. Maybe there is a biotech bubble or maybe there is a bubble in the bubble talk.

The fact is three healthcare ETFs, including two biotech funds, remain among 2015’s top 10 non-leveraged ETFs and some analysts are not shying away from saying the recent retrenchment in biotech ETFs could be a buying opportunity. [Room to Run for Healthcare ETFs]

“From January 1, 2011 to December 31, 2014, the S&P 1500 Biotechnology stock index rose 288.5% compared with the 63.6% rise for the S&P Composite 1500. As such, the S&P 1500 biotech industry’s valuation has expanded significantly from 12X forward 12-month EPS in 2011 to 18X in 2014. However, in spite of the significant multiple expansion, biotech’s current 19.1 multiple is equal the health care sector’s PE multiple of forward 12-months EPS and only slightly higher than the broader S&P 1500’s PE multiple of 18X, despite much stronger growth,” said S&P Capital IQ in a note out Thursday.

The research firm has four-star ratings on Celgene (NasdaqGS: CELG) and Gilead Sciences (NasdaqGS: GILD), which have fallen 8% and 1.3%, respectively, over the past week. Those stocks are IBB’s third- and fourth-largest holdings, combining for 15% of the ETF’s weight. S&P Capital IQ rates IBB and the First Trust NYSE Arca Biotechnology Index Fund (NYSEArca: FBT), the second-largest biotech ETF by assets behind IBB, overweight.

IBB, FBT and the equal-weight SPDR S&P Biotech ETF (NYSEArca: XBI) pulled in over $1.2 billion in assets during the first two months of 2015, according to S&P Capital. Although it is home to just 30 stocks compared to 150 in IBB and 100 in XBI, FBT has become a favorite of advisors and investors due to its mix of large-caps like Celgene and Gilead with an array of confirmed and rumored takeover targets, such as Pharmacyclics (NasdaqGS: PCYC) and BioMarin Pharmacuetical (NasdaqGS: BMRN). [ETFs for Biotech Takeover Targets]

“Total sales for the seven biotech companies in the S&P 500 rose 41.5 % in 2014, driven by new drug approvals, and aided by Gilead Sciences sales growth of 122%. In 2015, our forecasted rate of increase moderates to 13.2%, nonetheless, an impressive rate, in our view. S&P Capital IQ equity analyst Jeff Loo projects gross margin for those seven S&P 500 constituents, which also includes Celgene, to widen to 89.8% in 2015, from 88.6% in 2014,” notes S&P Capital IQ.

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