The Best 4 Pharmaceutical Stocks to Buy in Any Climate

With the global pandemic still dominating all of our lives, it’s not surprising that pharmaceutical stocks remain top of mind with investors. Pharmaceutical stocks, such as Moderna (NASDAQ:MRNA) and Novavax (NASDAQ:NVAX), saw their share prices more than double in the last year.

Although the pandemic has brought a lot of pharmaceutical stocks to the fore, there are a variety of companies with a very long view with cures and therapies under constant development in their pipelines.

However, not all pharmaceutical stocks have their wagons hitched to solving the Covid-19 pandemic. There are many pharmaceutical stocks that are great long-term investments and would be good additions to a portfolio in any environment. Here we look at four such pharmaceutical stocks.

  • GlaxoSmithKline (NYSE:GSK)
  • Pfizer (NYSE:PFE)
  • Johnson & Johnson (NYSE:JNJ)
  • Regeneron (NASDAQ:REGN)

Best Pharmaceutical Stocks: GlaxoSmithKline (GSK)

A GlaxoSmithKline (GSK) office in London.

Source: Willy Barton / Shutterstock.com

Shares of British multinational pharmaceutical company GlaxoSmithKline have been slumping lately (down 20% from January 2020) and many investors see this underperformance as a buying opportunity. Especially given that GSK stock pays a 5.86% dividend yield.

However, investors should take a long view of GlaxoSmithKline and treat the stock as a reclamation project. In the short-term, the company faces strong headwinds. Two of particular concern art that fact that its research and development pipeline has thinned out in recent years and its best-selling shingles vaccine, Shingrix, cannot be taken with Covid-19 vaccines.

However, long-term, GSK stock should prove to be among the more resilient pharmaceutical stocks and bounce back.

The company has continued to post strong sales in its respiratory, HIV, oncology (cancer) and consumer health products divisions despite the upheaval caused by the worldwide pandemic. And, while slimmed down in recent years, the company still has some 40 new medicines and about 20 new vaccines in its development pipeline.

Plus, until the share price rebounds, investors can enjoy GSK’s strong dividend yield, which the company has committed to maintaining. At under $40 a share, this stock is very affordable.

Pfizer (PFE)

Pfizer (PFE) logo on Pfizer building. Pfizer is an American pharmaceutical corporation.

Source: Manuel Esteban / Shutterstock.com

Speaking of stocks that are great value at current levels, how about New York-based Pfizer? The pharmaceutical giant is currently in the process of rolling out its Covid-19 vaccine, developed in partnership with BioNTech (NASDAQ:BNTX) all around the world.

Pfizer’s vaccine against Covid-19 was the first one approved in the U.S., Canada and the United Kingdom, among other countries. The company literally cannot produce the vaccine fast enough. Pfizer has announced that it will supply 40 million doses of its vaccine to the World Health Organization for distribution in poorer countries.

Yet, despite its efforts, Pfizer has come under fire from politicians in Canada and Europe for not shipping enough doses of the vaccine quickly.

Aside from the Covid-19 vaccine, Pfizer remains one of the most profitable pharmaceutical companies in the world. It makes some of the most popular medications on earth and has annual revenues approaching $50 billion.

Pfizer also has about $10 billion of cash on hand and a strong pipeline of potential new medications. Yet PFE stock has dropped since its Covid-19 vaccine was first approved in early December, falling 15% in the last month to its current level of $36.55.

Analysts remain supportive of the stock, with a median price target of $41.00 a share. Buy shares before the company’s earnings, with Covid-19 vaccine sales included, are released.

Johnson & Johnson (JNJ)

Johnson & Johnson is a true blue-chip company, and JNJ stock is one of the pharmaceutical stocks investors can buy, hold and benefit from for years to come. Based in New Brunswick, N. J., the company has a lot to recommend it, including a rock-solid dividend that has been increased for nearly 60 consecutive years.

Johnson and Johnson’s dividend currently yields 2.52%, which is healthy and sustainable. Additionally, Johnson and Johnson has arguably the most popular and robust consumer health division of any pharmaceutical company with stalwart brands such as Tylenol, Motrin, Imodium and Band-Aid.

Johnson & Johnson also remains a player in the Covid-19 vaccine race. While its vaccine candidate has not yet been approved by regulators, anticipation for the shot is running at a fever pitch.

This is because Johnson & Johnson’s Covid-19 vaccine, which entered a global phase 3 clinical trial last September, is expected to be effective in a single dose. Unlike other Covid-19 vaccines that require two doses to work, Johnson & Johnson’s vaccine will require only one shot to be effective in people.

Some analysts say this could be a game-changer in the struggle to get populations around the world immunized and end the pandemic for good. JNJ stock has been rising since the end of October, up nearly 20% to its current level of $163.55.

Regeneron (REGN)

The Regeneron (REGN) website is displayed on a smartphone screen over a blue background.

Source: madamF / Shutterstock.com

Regeneron has consistently rewarded investors. A $10,000 investment made in REGN stock when it went public in 1991 would be worth more than $300,000 today.

The stock has consistently outperformed the S&P 500 index over the years. And that outperformance continued in 2020 despite the ravages of the global pandemic.

Regeneron’s stock has risen 50% in the past 12-months to its current price of around $515 a share. The company and its stock got a lot of attention after the media revealed that Regeneron’s antibody cocktail was used to treat U.S. President Donald Trump when he caught Covid-19 last October.

Regeneron’s time in Covid-19 limelight continues as the U.S. government recently agreed to buy an additional 1.25 million doses of the company’s antiviral treatment for Covid-19 in a deal worth a reported $2.6 billion.

Pandemic aside, Regeneron also has a strong performing vision-loss treatment medication called “Eylea,” and a potential blockbuster treatment for eczema called  “Dupixent.”

The company also has an immunotherapy treatment for lung cancer that is presently under priority review with the U.S. Food and Drug Administration (FDA), and, by the end of 2022, expects to submit five additional drugs for FDA review. REGN stock is positioned for the long-term.

On the date of publication, Joel Baglole held a long position in MRNA.


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