With rapid innovations in biotechnology, companies are developing improved therapies and diagnostic tools addressing chronic diseases and improving patient outcomes. Moreover, the inclusion of modern tools like artificial intelligence and robotics are also contributing towards shifting gears for the biotech industry.
Amid this backdrop, investing in fundamentally stable biotech stocks, Vertex Pharmaceuticals Incorporated (VRTX), Amgen Inc. (AMGN), and Gilead Sciences, Inc. (GILD) could be the move for investors looking to capitalize on the sector’s expansion.
The biotechnology industry is experiencing considerable growth, driven by increasing demand for personalized medicine and breakthroughs in treating chronic diseases. The approval of 50 novel drugs by the U.S. FDA in 2024 alone showcases the sector’s prospects in the coming years.
That being said, rapid drug discovery and well-timed results could not have been possible without the inclusion of modern technology in the production and R&D fields. As the AI-driven drug discovery industry continues to grow, newer and more advanced pipelines are being discovered in a shorter amount of time, resulting in a more expanded reach for the biotech sector.
Additionally, there has been a new contender for aiding us with the required capabilities to advance our drug-producing and research capabilities- Robotics. Robotics has advanced the field by reducing human errors like repeatability, accuracy, and sterility, and aiding us in a safer and more efficient production process.
In line with these positive trends, a study by Precedence Research forecasts the global biotechnology market to reach $4.61 trillion by 2034, growing at a CAGR of 11.5%.
Now, let us dive deep into the fundamentals of three Biotech stocks, starting with #3.
Stock #3: Vertex Pharmaceuticals Incorporated (VRTX)
VRTX is a biotechnology company that is developing and commercializing therapies for treating cystic fibrosis (CF). It offers TRIKAFTA/KAFTRIO, SYMDEKO/SYMKEVI, ORKAMBI and KALYDECO.
On January 10, 2025, VRTX announced an exclusive collaboration and license agreement with Zai Lab Limited (ZLAB) to develop and commercialize VRTX’s povetacicept (pove) in mainland China, Hong Kong SAR, Macau SAR, Taiwan region, and Singapore.
The collaboration could enhance VRTX’s market presence in the respective regions and drive sales growth.
On December 20, 2024, VRTX announced U.S. FDA approval of ALYFTREK for the treatment of CF in people 6 years and older who have at least one F508del mutation or another mutation in the CFTR gene that is responsive to ALYFTREK.
The approval strengthens the company’s pipeline for the treatment of CF and related conditions and enhances its market presence.
For the fiscal 2024 third quarter that ended September 30, VRTX’s net product revenues increased 11.6% year-over-year to $2.77 billion. Its non-GAAP operating income rose 11.4% from the year-ago value to $1.31 billion.
Additionally, the company’s non-GAAP net income and non-GAAP net income per share grew 7.5% and 7.4% from the prior year’s quarter to $1.14 billion and $4,38, respectively.
Analysts expect VRTX’s revenue for the fiscal year ending December 2025 to increase 8.4% year-over-year to $11.80 billion. Its EPS for the same period is expected to rise significantly from the prior year to $18.73. Moreover, the company has surpassed the consensus revenue and EPS estimates in three of the four trailing quarters.
VRTX’s shares surged 8% over the past month and 11.4% over the past nine months to close the last trading session at $441.52.
VRTX’s POWR Ratings reflect its sound fundamentals. The stock has an overall rating of B, translating to a Buy in our proprietary rating system. The POWR Ratings assess stocks by 118 different factors, each with its own weighting.
VRTX has a B grade for Value. Within the Biotech industry, VRTX is ranked #32 out of 332 stocks.
To access VRTX’s Sentiment, Growth, Momentum, Growth, and Stability ratings, click here.
Stock #2: Amgen Inc. (AMGN)
AMGN discovers, develops, manufactures, and delivers human therapeutics. The company's product offerings include Enbrel, Otezla, Prolia, XGEVA, Repatha, Nplate, KYPROLIS and more for treating different conditions.
On January 17, 2025, AMGN announced U.S. FDA approval of LUMAKRAS® (sotorasib) in combination with Vectibix® (panitumumab) for the treatment of adult patients with KRAS G12C-mutated metastatic colorectal cancer. The approval strengthens the company’s portfolio of offerings for its cancer treatment pipeline.
On December 5, 2024, AMGN announced a $1 billion expansion to establish a second drug substance manufacturing facility in North Carolina. The expansion is aimed at enhancing the company’s manufacturing network to meet the growing demand for its innovative therapies along with contributing to the local economy.
For the fiscal 2025 third quarter that ended September 30, AMGN’s total revenues increased 23.2% year-over-year to $8.50 billion. Its non-GAAP operating income rose 18.8% from the year-ago value to $4.03 billion.
Moreover, the company’s non-GAAP net income and non-GAAP EPS grew 13.4% and 12.5% from the prior year’s quarter to $3.02 billion and $5.58, respectively.
Street expects AMGN’s revenue and EPS for the fiscal 2024 fourth quarter that ended in December to increase 8.2% and 7.7% year-over-year to $8.87 billion and $5.07, respectively. Additionally, the company has surpassed consensus revenue and EPS estimates in three of the four trailing quarters.
Shares of AMGN surged 7.3% over the past month to close the last trading session at $281.68.
AMGN’s POWR Ratings reflect its robust prospects. The stock has an overall rating of B, equating to a Buy in our proprietary rating system.
AMGN has a B grade for Quality and Growth. Within the Biotech industry, it is ranked #18 out of 332 stocks.
In addition to the POWR Rating highlighted above, you can check AMGN’s ratings for Value, Stability, Sentiment, and Momentum here.
Stock #1: Gilead Sciences, Inc. (GILD)
GILD is a biopharmaceutical company that discovers, develops, and commercializes medicines in the areas of unmet medical need. The company’s offerings include Biktarvy, Genvoya, Descovy, Odefsey, Truvada, Complera/ Eviplera, Stribild, Sunlencs for the treatment of HIV/AIDS, COVID-19, viral hepatitis and more.
On January 11, 2025, GILD announced a strategic partnership with LEO Pharma to accelerate the development and commercialization of LEO’s small molecule oral STAT6 programs for the potential treatment of patients with inflammatory diseases.
The collaboration could enhance GILD’s portfolio of treatment of inflammatory diseases and enhance the company’s market position.
On December 17, 2024, GILD announced a U.S. FDA grant for Breakthrough Therapy Designation to Trodelvy® aimed at the treatment of adult patients with extensive-stage small cell lung cancer whose disease has progressed on or after platinum-based chemotherapy.
The development could enhance Trodelvy’s results through expediting the development and regulatory review of investigational treatments and enhance the company’s portfolio.
For the fiscal third quarter that ended September 30, 2024, GILD’s total revenues increased 7% year-over-year to $7.55 billion. Its non-GAAP operating income rose 1.1% from the year-ago value to $3.26 billion.
Furthermore, non-GAAP net income attributable to GILD and non-GAAP EPS amounted to $2.53 billion and $2.02, respectively.
The consensus revenue estimate of $28.41 billion for the fiscal year ending December 2025 reflects a marginal year-over-year rise. Its EPS for the same period is expected to increase 72.3% year-over-year to $7.59. Additionally, the company has surpassed consensus revenue estimates in all four trailing quarters.
GILD’s shares have surged 23% over the past six months and 45% over the past nine months to close the last trading session at $95.59.
GILD’s strong fundamentals are mirrored in its POWR Ratings. The stock has an overall rating of A, equating to a Strong Buy in our proprietary rating system.
GILD has a B grade for Growth, Value, Sentiment, and Quality. It has topped the 332-stock Biotech industry.
Click here to access GILD’s Stability and Momentum ratings.
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AMGN shares were unchanged in premarket trading Thursday. Year-to-date, AMGN has gained 8.07%, versus a 2.68% rise in the benchmark S&P 500 index during the same period.
About the Author: Aritra_Gangopadhyay
Aritra is a financial journalist dedicated to breaking down complex financial topics into simple, actionable insights. Holding a Master’s degree in Economics, he uses his analytical expertise to help investors uncover unique opportunities for long-term success.
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