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Investing in biotech stocks can be rewarding. Not just because these stocks have the potential to produce meaningful gains in your portfolio, but also because when you invest in them, you’re investing in companies that are working to treat or heal medical ailments that cause issues for people around the world.
But investing in these stocks can be tricky. After all, you want to make sure that your investments produce a meaningful return. And it can be hard to decide which biotech stocks you should add to your investment portfolio.
Halozyme Therapeutics Is a Cancer Therapy Innovator
Founded in 1998, Halozyme Therapeutics ( Nasdaq: HALO ) is an innovator in the field of oncology. In particular, the company develops therapies that are designed to treat the tumor microenvironment and speed up the cancer treatment process.
The company currently has two commercially available products: Hylenex and Xyosted. At its core, Hylenex is designed to treat dehydration, which is an important treatment for cancer patients who often experience this problem. In particular, this treatment helps the human body absorb injected medications. It can also improve the results of contrast imaging, helping physicians more clearly see what’s happening in tumors and other ailments.
Analysts seem to love the stock too. At the moment, nine analysts weigh in on the stock. Six of them rate it a Buy, three rate it a Hold, and there are no Sell ratings to speak of. The price target on the stock is $57.75, representing the potential for a nearly 10% upside.
Vertex Pharmaceuticals Is Pioneering Treatments for Serious Conditions
Founded in 1989, Vertex Pharmaceuticals ( Nasdaq: VRTX ) is a biotechnology company that’s working to produce therapies for a wide range of serious medical conditions. The company is most well known for its cystic fibrosis pipeline — one that includes six commercially available treatments.
Vertex has commercially available treatments for other ailments, too. In particular, it’s the company behind CASGEVY, a therapeutic that’s indicated to treat sickle cell disease and transfusion-dependent beta thalassemia.
And while Vertex Pharmaceuticals has an impressive list of commercially-available therapeutics, the company’s pipeline may be even more impressive. At the moment, the company is working on three phase three clinical trials, studying treatments for kidney disease, pain, and cystic fibrosis. Not to mention its other 18 clinical programs with phases ranging from research to phase 2 clinical trials.
Of the 24 analysts are weighing in on the stock, 17 of them rate it a Buy, 5 rate it a Hold, and 2 rate it a Sell. The stock’s consensus price target is $467, representing a potential 5% downside. But, much of the reason for the low price target centers around the two analysts with sell ratings, since their $325 price targets weigh into the consensus.
Nonetheless, the company’s financial performance has been impressive. In the most recent quarter, it generated $2.69 billion in revenue, up 13.3% year-over-year. Net income was up 57.13%, coming in at $1.1 billion, and diluted earnings per share came in at $4.21, representing 56.51% growth.
ADMA Biologics Can Lead the Way to Plasma-Derived Treatment Profits
Founded in 2004, ADMA Biologics (Nasdaq: ADMA) is the smallest biotechnology company on this list. But, don’t let its size fool you; the opportunity it represents is hard to ignore.
The company is focused on producing plasma-derived therapies with immunotechnology. The company currently has three commercially available products: ASCENIV, BIVIGAM, and Nabi-HB.
ASCENIV is a therapy designed for children ages 12 to 17 years old with primary immunodeficiency. It helps to both fight and prevent infections in adolescent patients. BIVIGAM is a therapeutic that’s indicated to treat patients with primary humoral immunodeficiency (PI). Nabi-HB is designed for patients with hepatitis B infections.
ADMA Biologics is the target of 4 ratings from analysts, all of whom rate the stock a Buy. The current price target on the stock is $12.25, which is in line with its current price. But, I expect that price target to increase, as most analysts who have weighed in on the stock haven’t shared or updated their opinions recently.
As with other stocks on this list, ADMA Biologics has had a stellar earnings performance. In the last quarter’s earnings report, the company announced revenue of $81.88 million, up 43.86%. And while revenue growth is impressive, it’s minimal compared to what we’ve seen out of net income and diluted earnings per share, which were up 362.28% and 366.67%, respectively.
Jazz Pharmaceuticals Can Produce Serious Gains
Founded in 2003, Jazz Pharmaceuticals ( Nasdaq: JAZZ ) is a biotechnology company with a focus on helping consumers fight a wide range of serious medical conditions. The company’s claim to fame is centered around its cannabis-derived therapeutics, Epidiolex and Sativex. Both of these therapeutics are designed to treat neurological conditions. But, they’re not the only therapeutics the company offers. In fact, it has a wide range of therapeutics designed to treat conditions like epilepsy and cancer.
And, if analysts are correct, Jazz Pharmaceuticals has quite a bit of room for growth. 14 analysts are currently weighing in on the stock. 12 of them rate it a Buy and 2 rate it a Hold. There are no Sell ratings on JAZZ at the moment. And, the consensus price target is $178.67, representing the potential for nearly 70% growth over the next 12 months.
In the most recent quarterly earnings report, Jazz Pharmaceuticals reported revenues of $901.98 million, representing just over 1% year-over-year growth. Both net income and earnings per share were down, likely due to increased operating expenses. Nonetheless, most analysts expect earnings to start picking up again soon.
CRISPR Therapeutics Offers a Budding Opportunity
Founded in 2013, CRISPR Therapeutics ( NASDAQ: CRSP ) is the youngest company on this list. But don’t let the company’s age fool you. It may represent one of the largest opportunities. The company’s claim to fame is its gene-editing technology.
The company’s gene-editing technology is central to CAR T cell therapy, a unique therapeutic that can provide better outcomes for patients with a wide range of cancers, including blood to brain cancers. The company’s technology is also used to treat sickle cell disease and beta thalassemia with its approved therapeutic, Exagamglogene Autotemcel.
16 analysts are weighing in on the stock. Nine of those analysts rate it a Buy, six rate it a Hold, and one rates it a Sell. The current consensus price target is $78.36 per share, representing a more than 37% upside.
Unfortunately, however, the most recent earnings report from CRISPR Therapeutics left a bit to be desired. Revenue, net income, and earnings were all down, leading to a significant decline in the value of the stock. But it seems as though the stock has priced the earnings miss in, and with such strong analyst opinions, valuable products, and a significant pipeline of products that may come to market in the future, this stock is well worth consideration.
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