As chronic diseases continue to rise globally, the need for innovative healthcare solutions grows exponentially. Investors looking to tap into this expanding sector may find good opportunities in established healthcare leaders, Pfizer Inc. (PFE), Merck & Co., Inc. (MRK), and AbbVie Inc. (ABBV). Let us understand in detail.
As the world faces a surge in chronic diseases and evolving health challenges, the demand for innovative healthcare solutions has never been more critical. The increasing senior population is grappling with chronic conditions like heart disease, diabetes, and respiratory issues.
In addition, lifestyle-related conditions such as obesity, hypertension, and mental health issues are also on the rise. Moreover, the global disease landscape is also evolving, with both infectious and non-communicable diseases continuing to burden healthcare systems.
Emerging threats such as antibiotic resistance and new viral infections further complicate the global health crisis. These challenges underscore the importance of cutting-edge treatments, robust healthcare strategies, and global collaboration to mitigate the spread of infectious diseases and address the urgent need for advanced therapeutic solutions.
The increasing demand for effective treatments is evident, with 42 new drugs approved by the U.S. Food and Drug Administration this year for chronic conditions. These developments demonstrate the pharmaceutical industry’s ability to meet the growing healthcare needs and provide solutions for complex and widespread diseases.
That said, the global pharmaceutical market is projected to generate $1.16 trillion in revenue this year and is expected to reach $1.45 trillion by 2029 growing at a CAGR of 4.7%. As pharmaceutical companies work to develop new treatments for chronic and infectious diseases, the sector offers promising prospects.
So let us dive deep into the fundamentals of three Medical - Pharmaceuticals stocks, starting with #3.
Stock #3: Pfizer Inc. (PFE)
PFE discovers, develops, manufactures, and markets biopharmaceutical products. It offers medicines and vaccines across therapeutic areas, including cardiovascular, infectious diseases, immunology, oncology, and women’s health. The company serves healthcare providers, pharmacies, hospitals, and government agencies.
On November 20, PFE announced the approval by the European Commission (EC) for HYMPAVZI™ for the routine prophylaxis of bleeding episodes in patients 12 years of age and older weighing at least 35 kg with severe hemophilia A without FVIII inhibitors or severe hemophilia B without FIX inhibitors.
The approval strengthens PFE’s position in the genetic disease treatment market and facilitates stable growth prospects through its offerings.
On October 22, PFE announced the U.S. Food and Drug Administration's (FDA) approval of ABRYSVO, its bivalent RSV prefusion F vaccine, for the prevention of lower respiratory tract disease (LRTD) caused by RSV in individuals 18 through 59 years of age who are at increased risk for LRTD caused by RSV.
The approval broadens the company’s infectious disease treatment pipeline and helps solidify the company’s position as an industry leader.
For the fiscal 2024 third quarter that ended September 29, PFE’s total revenues increased 31.2% year-over-year to $17.70 billion. The company’s adjusted net income and adjusted earnings per common share attributable to PFE common shareholders stood at $6.05 billion and $1.06, compared to a net loss and loss per share of $968 million and $0.17 in the prior year’s quarter, respectively.
Analysts expect PFE’s revenue and EPS for the fiscal fourth quarter (ending December 2024) to increase 21.3% and 372.9% year-over-year to $17.28 billion and $0.47, respectively. Moreover, the company topped the consensus EPS estimates in all four trailing quarters.
Shares of PFE have surged 1.9% over the past five days, closing the last trading session at $25.83.
PFE’s POWR Ratings mirror its solid fundamentals. The stock has an overall rating of B, which translates to a Buy in our proprietary rating system. The POWR Ratings assess stocks by 118 different factors, each with its own weighting.
PFE has an A grade for Growth and a B for Value. It is ranked #27 out of 154 stocks in the Medical - Pharmaceuticals industry.
In addition to the POWR Rating highlighted above, you can check PFE’s ratings for Stability, Sentiment, Momentum, and Quality here.
Stock #2: Merck & Co., Inc. (MRK)
MRK excels as a research-driven biopharmaceutical company. Its Pharmaceutical segment delivers human health medicines and vaccines, while the Animal Health division innovates veterinary pharmaceuticals, vaccines, and health management services to prevent, treat, and control diseases in livestock and companion animals.
On November 22, MRK announced China’s National Medical Products Administration's approval of WELIREG for treating adults with von Hippel-Lindau disease. The approval strengthens MRK's oncology portfolio, expands its presence in China, and reinforces its commitment to addressing unmet medical needs in rare and complex diseases.
On November 15, MRK announced that the European Medicines Agency’s Committee for Medicinal Products for Human Use issued a positive opinion recommending KEYTRUDA’s approval. This milestone supports KEYTRUDA as a first-line treatment for adults with unresectable non-epithelioid malignant pleural mesothelioma, enhancing MRK’s position in advancing oncology care in Europe.
For the fiscal 2024 third quarter that ended September 30, MRK’s sales increased 4.4% year-over-year to $16.66 billion. In addition, the company’s non-GAAP net income and non-GAAP EPS were reported to be $3.99 billion and $1.57, respectively.
For the fiscal fourth quarter ending December 2024, Street expects MRK’s revenue to increase 6.4% year-over-year to $15.56 billion. Its EPS for the ongoing quarter is expected to rise significantly from the prior year’s period to $1.84. Plus, the company has surpassed the consensus revenue and EPS estimates in all of its four trailing quarters.
MRK’s shares surged 1.7% over the past year to close the last trading session at $103.12.
MRK’s strong prospects are projected in its POWR Ratings. The stock has an overall rating of A, which translates to a Strong Buy in our proprietary rating system.
MRK has an A grade for Quality and a B for Value and Stability. It is ranked #6 out of 154 stocks in the Medical - Pharmaceuticals industry.
Click here to access MRK’s ratings for Growth, Momentum, and Sentiment.
Stock #1: AbbVie Inc. (ABBV)
ABBV drives innovation as a diversified biopharmaceutical leader, focusing on research, development, manufacturing, and sales of medicines and therapies. Its extensive product portfolio spans Immunology, Oncology, Neuroscience, Eye Care, Aesthetics, and other specialties.
On November 18, ABBV announced the European Commission’s approval of ELAHERE® for treating adults with folate receptor-alpha positive, platinum-resistant high-grade serous epithelial ovarian, fallopian tube, or primary peritoneal cancer. The approval strengthens ABBV’s oncology portfolio and addresses critical unmet needs in advanced gynecologic cancers.
On October 31, ABBV announced a collaboration with EvolveImmune Therapeutics to develop multispecific biologics targeting various cancers. Leveraging EvolveImmune’s T-cell engager platform, ABBV aims to enhance its oncology portfolio, drive innovation in immuno-oncology, and expand its market presence in the cancer treatment landscape.
For the fiscal 2024 third quarter that ended September 30, ABBV’s net revenues increased 3.8% year-over-year to $14.46 billion. Its operating earnings rose 68% from the year-ago value to $3.83 billion.
Additionally, the company’s adjusted earnings and adjusted EPS grew 1.5% and 1.7% from the prior year’s quarter to $5.33 billion and $3.00, respectively.
The consensus revenue and EPS estimates of $14.81 billion and $2.98 for the fiscal fourth quarter ending December 2024 exhibit a year-over-year rise of 3.5% and 6.7%, respectively. Moreover, the company topped the consensus revenue estimates in all four trailing quarters.
Shares of ABBV have surged 16.6% over the past six months and 31.6% over the past year to close the last trading session at $183.08.
ABBV’s bright prospects are reflected in its POWR Ratings. The stock has an overall rating of A, which translates to a Strong Buy in our proprietary rating system.
ABBV has a B grade for Growth, Value, and Stability. It is ranked #4 out of 154 stocks within the same industry.
Click here to access ABBV’s Momentum, Sentiment, and Quality ratings.
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ABBV shares were unchanged in premarket trading Friday. Year-to-date, ABBV has gained 22.46%, versus a 27.18% rise in the benchmark S&P 500 index during the same period.
About the Author: Aanchal Sugandh
Aanchal's passion for financial markets drives her work as an investment analyst and journalist. She earned her bachelor's degree in finance and is pursuing the CFA program. She is proficient at assessing the long-term prospects of stocks with her fundamental analysis skills. Her goal is to help investors build portfolios with sustainable returns.
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