Until recently, Viatris (NASDAQ:VTRS) was considered a value play among drug stocks. But after its recent earnings report, and announced sale of a key asset? The generic drug maker has been deemed a “value trap,” and has experienced a sharp plunge in price.

Falling by about 23% right after the news, and down around 32.5% in the past month, it may take some time for Viatris to bounce back. Another generic drug maker, Teva Pharmaceutical (NYSE:TEVA), has sold off in recent weeks, too, after reporting underwhelming results and outlook. The market is also giving Teva the “value trap” designation.

Hard times for value investors looking for bargains among the drug makers. Or are they? Generic makers may be failing to deliver, yet if you want pharmaceutical plays that are can’t miss deals, they may be right in front of you with many of the major names in the space.

Not only are many of these names selling for relatively low price-to-earnings (P/E) multiples. Many you could consider “high yield” stocks, with above-average payouts. So, as Viatris and other generic drug makers plunge, what should you buy instead?

Consider these seven well-known drug stocks, all of which are good value in what’s still a pricey market:

• AbbVie (NYSE:ABBV)
• Bristol-Myers Squibb (NYSE:BMY)
• GlaxoSmithKline (NYSE:GSK)
• Johnson & Johnson (NYSE:JNJ)
• Merck (NYSE:MRK)
• Novartis (NYSE:NVS)
• Pfizer (NYSE:PFE)

Drug Stocks to Buy: AbbVie (ABBV)

In recent months, bullishness has returned to ABBV stock. Before, the market placed heavy focus on the expected drop off in AbbVie sales of its Humira treatment. Humira biosimilars are expected to hit the market next year.

Yet with Humira sales still solid, and as two of its immunology drugs (Skyrizi and Rinvoq) perform well, the market’s back to focusing more on AbbVie’s positives than its negatives. Over the past six months, shares have surged nearly 35%. That said, while not as overly priced-in as before, the expectation of declining earnings remains priced into the stock.

Earnings per share (EPS) for ABBV is expected by analysts to come in at $14.18 this year, dropping around 13.% in 2023 to $12.29 per share. That means the stock trades for around 10.6x 2022 earnings, and 12.3x next year’s earnings. But even with its run-up, investors could still be underestimating how much its newer drugs help to make up for the pending decline of Humira sales.

This could result in further upside. The market could re-rate it at a higher multiple. On top of this, there’s also its 3.75% forward yield. A continued (albeit more gradual) rise in price, coupled with the dividend, could mean solid returns for income and value investors buying it today.

Bristol-Myers Squibb (BMY)

Bristol-Myers Squibb is another one of the top value plays among drug stocks. At today’s prices (around $69 per share), it trades for 8.9x this year’s earnings. Alongside this, it sports a 3.11% forward dividend yield. Not only that, its payout has grown an average 5.6% per year over the past five years. It’s also raised its dividend 15 years in a row.

However, unlike ABBV stock, there isn’t a hint of earnings decline baked into the BMY stock price. Delivering strong earnings lately, it’s expected to see its EPS go up again in 2023. This is despite, as a Forbes commentator Trefis Team discussed last month, the fact that its top selling drug, Revlimid, loses market exclusivity this year.

While it’s shot back up in price since December, after a pullback last fall, it may not be too late to buy it. It may have a good chance of seeing its forward multiple continue to expand. I’m not saying 15x or 20x, which is above what most major drug stocks are trading for right now.

Still, a bump up from high single-digits to low double-digits would mean a solid move higher for shares. Again, like AbbVie, combined with its dividend, in a rocky stock market, this may result in a satisfying return for investors.

Drug Stocks to Buy: GlaxoSmithKline (GSK)

Trading for 12.5x estimated earnings for 2022, GlaxoSmithKline trades at the higher end of multiples among the drug makers. With this, you may wonder why I’m including it on this list, which focuses mainly on value plays in the space.

The reason? It may appear to sport a more premium valuation relative to the names listed above and below. But in the case of GlaxoSmithKline, it’s possible that this is more than justified. The pharma giant stands to continue delivering solid revenue and earnings growth.

It’s not only successfully selling a Covid-19 treatment (Sotrovimab). It also has an HIV drug (Cabenuva) on the market that’s seeing a very high increase in sales.

Glaxo also sports a high 5.43% forward dividend yield, although there’s a reason for this. The payout is set to come down, once it completes the spinoff of its consumer healthcare unit, Haleon, later this year.

Even so, the value potentially unlocked from the spin off, plus the growth of its core unit, could more than up for this payout reduction. At around $39 per share, and pulling back in recent weeks, you may want to consider entering a position in GSK stock today.

Johnson & Johnson (JNJ)

A few weeks back, I argued why Johnson & Johnson may be a great low-volatility play to buy in order to minimize the impact of today’s roller coaster stock market. So far, although JNJ stock temporarily dipped on news of Russia’s invasion of Ukraine, it has more or less held steady.

Yet understandably, you may not be just looking for a stock that will lose less as 2022 plays out. Rather, you’re probably looking for something that could close out the year in the green instead of in the red. That may be more than possible here with Johnson & Johnson.

Even as the undeniably blue-chip dividend aristocrat trades for 16x this year’s earnings, well ahead of the other big pharma names. Although this valuation implies that it’s a pricey drug stock, it’s important to keep in mind that “healthcare stock” may be the more accurate term for JNJ.

Besides its pharma unit, the company has consumer health and medical device products as well. A more diversified healthcare company, and one that trades at a discount to other “aristocrats,” it could see an inflow of investors, as rising rates and other uncertainties lead investors to safe harbors in order to ride out the storms at present.

Drug Stocks to Buy: Merck (MRK)

With negative revenue and earnings growth expected between 2022 and 2023, admittedly it may be tough to get excited about Merck. MRK stock sports a P/E ratio (10.6x), a multiple that’s in-line with other names in the space.

Yet you may wonder how exactly this will translate into a higher price for Merck, which today trades for around $77 per share. However, per the bull case presented by Morningstar’s Damien Conover a few weeks back.

The analyst believes that the drug giant’s research and development (R&D) efforts have paid off, as only a moderate investment has resulted in new drugs that offset patent losses. In particular, oncology drug Keytruda. This drug appears set to drive Merck’s growth in the years ahead. With all this, Conover gives shares the equivalent to a buy rating, and a price target of $94 per share.

As growth could come in above sluggish projections, and with its low valuation, there’s plenty of upside potential with MRK stock. There’s also a decent-sized dividend (forward yield of 3.55%). Raising its payout 12 years in a row, over the past five years, the dividend has grown by an average of 8.15% per year. Considering its low volatility as well, this is one of the best drug stocks to buy.

Novartis (NVS)

Swiss-based Novartis is another of the major drug stocks trading at a slightly higher valuation. At today’s prices, it sports a P/E ratio of 13.4x. Forward dividend yield comes in at a solid 3.96%. Sales and earnings should increase modestly between 2022 and 2023. Better than negative, but not exactly high (3.1% revenue growth, 9% earnings growth). At least, that’s what analyst estimates say.

However, like with MRK stock, it’s possible the sell-side is underestimating the impact of two upcoming drugs will have on the company’s bottom line, and in turn the price of NVS stock. As InvestorPlace’s Chris MacDonald discussed back in January, the pharma company has two potential blockbusters in its pipeline.

First, blood pressure treatment Entresto. Entresto could generate billions in revenue. Second, psoriasis treatment Cosentyx, which has a similar level of potential. Success with both these drugs could result in this year and next hitting the top end of estimates.

That’s something that could help shares re-hit their past 52-week high ($95.17 per share), and hit new highs, over the next year. For reference, Novartis stock trades for around $82.75 per share as of this writing. If you’re looking for better options out there than the generic drug stocks, be sure to include this maker of branded pharmaceuticals to your watch list.

Drug Stocks to Buy: Pfizer (PFE)

Capping things off, let’s look at shares in the company that spun-off Viatris: Pfizer. Last year, shares took off not once, but twice. Initially, due to it being one of the top pandemic vaccine providers. Its candidate, co-developed with BioNTech (NASDAQ:BNTX), generated $36 billion in revenue during 2021, and is set to generate tens of billions more this year.

Along with this, PFE stock took off in the last two months of 2021. At the time, the company received authorization for its Paxlovid Covid-19 treatment. This was seen to be something that would produce another big chunk of revenue (in the tens of billions).

Admittedly, now with Covid-19 falling out of the headlines, excitement for Pfizer has come down as well. Revenues and earnings stemming from its pandemic products could come down much faster than previously expected. Even so, the stock’s current valuation more than account for this decline.

At today’s prices (around $48 per share), PFE stock trades at a mid-single digit multiple (6.8x).

I wouldn’t hold my breath that the booster shot market (which is drying up) helps lower the decline in vaccine sales. Yet as the virus carries on in much of the world, demand for Paxlovid may remain robust. This may help the stock, which has a dividend yield of 3.29%, partially bounce back from its year-to-date losses.

On the date of publication, Thomas Niel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.