Buy these 8 weight-loss stocks for a fatter wallet as drugs like Ozempic supercharge the healthcare industry, Amplify ETFs' CEO says

• GLP-1 weight-loss drugs such as Ozempic and Wegovy have taken the healthcare scene by storm.
• Wall Street sees massive potential for the industry to explode and boost GDP.
• Amplify ETF CEO Christian Magoon shares his top 8 weight-loss stock picks.

Ozempic, Wegovy, Mounjaro, Zepbound — what were once specialized diabetes drugs have become household names as they're increasingly used for another purpose: weight loss.

These GLP-1 drugs that help people lose weight have taken off recently, and Wall Street is quite bullish on their potential. Goldman Sachs estimates that the global market for weight-loss drugs will explode in the coming years, from its current $6 billion to $100 billion by 2030.

This creates the perfect opportunity for investors to buy in, according to Amplify ETF's CEO Christian Magoon. He shares why he's so bullish on this area of healthcare and his top investment picks.

Wall Street is overweight on GLP-1

According to the CDC, over 40%, or over 100 million, of American adults are obese. This creates massive demand for drugs like Ozempic and Wegovy, said Magoon. Indeed, these GLP-1 drugs have been in short supply nationwide, which Magoon sees as another indicator of their continued success.

"This could be the largest drug category of all time," Magoon said.

Magoon's not alone in believing in the massive potential of weight-loss drugs — Goldman Sachs thinks they'll boost US GDP by up to 1% in the next few years as GLP-1 drugs increase labor force participation and allow people to live longer and healthier lives.

Although primarily known for weight loss, GLP-1 drugs have even more potential in other areas of healthcare. Ongoing research is constantly revealing new use cases in treating cardiovascular disease, sleep apnea, Alzheimer's, Parkinson's, and kidney disease.

With around 38 million Americans experiencing diabetes, 140 million obese, and 122 million with cardiovascular disease out of a total population of around 330 million, GLP-1 drugs have a vast total addressable market, said Magoon. He likens the impact of GLP-1 drugs on the healthcare sector to AI's impact on tech.

How to invest in weight-loss drugs

"If you're just an overall market investor and you own the S&P, you only have about 3%, 3.4% exposure to these GLP-1 specific type of companies," Magoon said, emphasizing the need to single out specific companies in your portfolio.

Because the industry is so nascent, investors should expect lots of innovation and M&A activity, according to Magoon. That's why he recommends investing across the entire value chain for GLP-1 drugs, from the pharmaceutical companies to the outsourced drug developers. Doing so provides investors with diversified exposure to this growing area of the healthcare sector. Below, Magoon shares 8 GLP-1 drug investments. They are all constituents of the Amplify Weight Loss Drug & Treatment ETF ( THNR ).

GLP-1 drug manufacturers such as Novo Nordisk ( NVO ) , the maker of Ozempic and Wegovy, and Eli Lilly ( LLY ) , the manufacturer of Mounjaro and Zepbound, are the biggest players in the weight- loss space right now. In 2023, they accounted for 98% of GLP-1 revenues.

The weight-loss drug industry certainly isn't winner-take-all, though. Magoon also likes Viking Therapeutics ( VKTX ) , Pfizer ( PFE ) , and Roche ( RHHBY ) . While these companies are smaller than Novo Nordisk and Eli Lilly, Magoon highlights that they have new technologies in the pipeline that could drastically boost the weight-loss drug industry and lead these stocks to soar. For example, the Swiss healthcare company Roche has developed a weight-loss drug in pill form with promising results in clinical trials. This could dramatically change the existing GLP-1 market, which is dominated by injectables.

Magoon also shares his top picks among the enablers responsible for the outsourced manufacturing and development of GLP-1 drugs. These companies are third-party contractors that partner with the previously mentioned pharmaceutical companies to assist with product development, formulation, packaging, and distribution. You might not expect a film company to have much relation to weight-loss drugs, but Fujifilm ( FUJIY ) helps manufacture and fill injection pens. Gerresheimer ( GRRMF ) is another injector-pen manufacturer. Thermo Fisher ( TMO ) measures and analyzes these drugs and was hired by Novo Nordisk as a contract manufacturer for Wegovy.