| Stock | Price | 52 Week Range | Marketcap | EPS | Dividend Yield | Chart (24H) | Sector | Employees | Last Updated |
|---|---|---|---|---|---|---|---|---|---|
| $819.36 | 735.57B | 12.29 | 0.73% | Healthcare | 43,000 | 3 days ago | |||
| $81.71 | 205.18B | 6.88 | 3.97% | Healthcare | 70,000 | 3 days ago | |||
| $49.75 | 101.25B | 2.68 | 4.98% | Healthcare | 34,100 | 3 days ago | |||
| $128.00 | 8.92B | 6.14 | 0.32% | 0 | 3 days ago | ||||
| $109.98 | 136.81B | 4.76 | 2.87% | Healthcare | 18,000 | 3 days ago | |||
 Alkermes plc ALKS | $29.83 | 4.92B | 2.10 | 0.00% | Healthcare | 2,100 | 3 days ago | ||
 Novavax, Inc. NVAX | $6.94 | 1.12B | 2.75 | 0.00% | Healthcare | 1,543 | 3 days ago |
Biopharmaceutical stocks have been on a tear so far this year. Many key companies on the medicinal frontier have rewarded shareholders handsomely for their faith and favor — though a few of those hot stocks still have the legs to run further. Industry research firm IMARC forecasts that by 2017, the global biopharmaceutical market will reach $166 billion in sales, highlighting the sector’s double-digit annual growth. This explosive potential isn’t just limited to massive multinationals; boutique drugs that target rare but dangerous conditions can become billion-dollar blockbusters, giving investors outsized returns for intelligent picks.
Traditional Big Pharma companies like Eli Lilly, Merck, and Bristol-Myers Squibb are moving heavily into biopharmaceutical mergers and acquisitions (M&A) to boost their mature drug pipelines. This underscores the invaluable role small to mid-sized biopharma firms play in this burgeoning industry. However, the biopharma sector is not without its risks. With only three out of every ten drugs that enter clinical trials making it to market, investors must balance potential rewards with significant risks.
For conservative traders, investing in an exchange-traded fund (ETF) like the iShares Nasdaq Biotechnology Index (IBB) can mitigate some of the risks. However, those with a higher risk tolerance might find it more rewarding to focus on a few standout individual biopharma stocks that promise strong potential for continued growth.
Editor's Note: Analysis and insight for this article were originally sourced sourced from our friends at InvestorPlace
Gilead Sciences (GILD): Dominating with Breakthrough Drug Innovations
Riding High on Breakthroughs
Gilead Sciences (GILD) recently reached a new all-time high, driven by the success of its drug idelalisib in a Phase 2 study. The oral medicine showed a staggering 97% response rate for chronic lymphocytic leukemia (CLL), with 93% of trial patients surviving progression-free for two years. This achievement positions GILD as a heavyweight in the biopharma sector.
Expanding Horizons
Gilead’s pipeline doesn’t end there. Its hepatitis C drug, sofosbuvir, is currently under formal review by the European Medicines Agency and has an application pending with the FDA. Additionally, the company maintains a strong HIV drug franchise, notably the four-drug therapy Stribild, ensuring robust revenue streams across multiple therapeutic areas.
Financial Muscle
Despite its meteoric rise, GILD still offers reasonable valuations with a forward price-to-earnings (P/E) ratio of 19.5 and a price/earnings-to-growth (PEG) ratio of 1.1. Gilead’s financial robustness and diverse, promising pipeline indicate that it should continue to defy gravity as long as its clinical trials stay on track. This makes GILD an enticing pick for investors looking for stable yet substantial returns.
Analyst Ratings: Gilead Sciences (GILD)
| Source | Consensus Rating | Average Price Target | Current Price | Potential Gain | Number of Ratings |
|---|---|---|---|---|---|
| Tipranks | Moderate Buy | $77.55 | $69.96 | 10.85% | 25 |
| Yahoo Finance | Not Available | Not Available | $67.76 | Not Available | Not Available |
| Wall Street Journal | Not Available | Not Available | $67.76 | Not Available | Not Available |
| Marketscreener | OUTPERFORM | $83.23 | $67.76 | 22.83% | 31 |
| Zacks | Not Available | $84.63 | $67.76 | 25.34% | 24 |
Summary of Analyst Outlook
Analysts are generally optimistic about Gilead Sciences (GILD), with a consensus leaning towards moderate to strong buy recommendations. The average price targets, ranging from $77.55 to $84.63, suggest a fair to significant potential gain compared to the current price of around $67.76. However, there is also some variation in the recommendations, with a few analysts suggesting a cautionary hold or sell rating.
Alkermes (ALKS): Midcap Marvel with Diverse Drug Portfolio
Diverse and Dynamic
Alkermes (ALKS) boasts a diverse portfolio with approximately 20 commercial products targeting major diseases such as multiple sclerosis (MS), schizophrenia, narcotic and alcohol dependence, and type 2 diabetes. Among its pipeline, notable drugs include 5461, which modulates opioid receptors in the brain to treat major depression, and 3831, aimed at treating schizophrenia with fewer traditional side effects like weight gain.
Solid Financial Standing
Alkermes trades around decade-long highs and has seen its shares more than double in the past year. It trades at 28 times next year’s earnings, but its low PEG ratio of 0.37 suggests strong growth potential relative to its price. The balance sheet reveals $209 million in cash against $370 million in debt, demonstrating prudent financial management.
Catalysts on the Horizon
Upcoming clinical data presentations could be the catalysts needed to propel ALKS even higher. While its novel approaches to targeting opioid receptors make it a potentially high-reward investment, this also comes with higher inherent risks. Potential investors may want to wait until after key clinical trial data is presented before initiating a new position.
Analyst Ratings: Alkermes (ALKS)
| Consensus Rating | Average Price Target | Current Price | Potential Gain | Number of Ratings |
|---|---|---|---|---|
| Moderate Buy | $35.61 | $23.57 | 44.39% | 12 |
Summary of Analyst Outlook
Analysts generally rate Alkermes as a moderate buy, with a strong potential gain of 44.39% based on an average price target of $35.61. The stock is currently trading at $23.57. The outlook is positive, but investors are advised to watch for upcoming clinical trial data before making any new investments.
Novavax (NVAX): Tiny Company with Massive Growth Opportunity
Innovative Vaccine Development
Novavax (NVAX) stands out with its innovative approach to vaccine development using recombinant DNA technology. Unlike traditional vaccines made from killed or weakened viruses, Novavax engineers “customized” vaccines using the genetic code of viruses or pathogens, allowing for rapid creation of targeted solutions.
High-Stakes Contracts
The company is focused on developing vaccines for H5N1 influenza and respiratory syncytial virus (RSV). It already has substantial government contracts with the U.S. Office of Biomedical Advanced Research and Development Authority and Homeland Security for influenza and foot-and-mouth disease vaccines. Speculation about Novavax potentially developing a vaccine for the H7N9 influenza strain has further boosted investor interest.
A Speculative Powerhouse
Currently trading at just over $2 per share, NVAX has seen a 79% increase over the past year, largely due to progress in clinical trials for RSV, seasonal influenza, and pandemic influenza vaccines. While NVAX is a speculative play, its innovative approach and compelling pipeline present high-reward opportunities for risk-tolerant investors.
Analyst Ratings: Novavax (NVAX)
| Source | Rating Consensus | Average Price Target | Current Price | Potential Gain | Number of Ratings |
|---|---|---|---|---|---|
| TipRanks | Moderate Buy | $19.33 | $13.11 | 47.44% | 5 |
| MarketWatch | Overweight | $22.80 | $12.55 | 77.71% | 6 |
| Zacks | Strong Buy | $22.80 | $12.83 | 77.71% | 5 |
| Benzinga | – | $54.43* | $11.82 | 86.07% | 7** |
Summary of Analyst Outlook
Analysts’ consensus for Novavax (NVAX) is largely positive. The average price target ranges from $19.33 to $54.43, indicating a significant upside potential. Ratings from sources like MarketWatch and Zacks suggest a strong buy to overweight, making NVAX a compelling speculative investment option.
Whether you’re drawn to the established might of Gilead Sciences, the diverse innovation of Alkermes, or the speculative allure of Novavax, these biopharma runners have significant fuel left in the tank. Invest smartly by balancing risk and reward, and these stocks could provide dynamic returns.
