The biotech sector is a hotbed of innovation, making the case for the best biotech stocks to buy in May. However, not all groundbreaking companies are worth the attention given the immense risks.
While the spotlight often shines on the biggest names in the industry, a wealth of underappreciated biotech stocks are quietly making waves. Each of these companies has a strong track record of success, a robust pipeline of promising therapies, and a clear vision for the future. For investors looking to diversify their portfolios with high-growth potential stocks, investing in these underappreciated biotech companies can be a strategic move.
Now, let’s discover the top 3 biotech stocks to buy in May 2024!
Vertex Pharmaceuticals (VRTX)
Vertex Pharmaceuticals (NASDAQ:VRTX) is a biotechnology company known for its leadership in the treatment of Cystic Fibrosis (CF). While this is their primary revenue source, the company has a number of positive catalysts for 2024.
One of the key factors driving the company’s growth in 2024 is their dominance in the CF market. Their current therapies are highly effective, and the company is actively working on next generation treatments that could further improve patient outcomes. Additionally, Vertex is into other novel therapies, such as Sickle Cell disease, beta-thalassemia, and acute neuropathic pain. This could open up new markets and significantly drive revenue growth and profitability. In Q1 FY24, revenue increased 13% YOY to $2.7 billion. Net income swelled 57% YOY to $1.1 billion, or $4.21 per share. The company continues to make strategic moves, including the proposed acquisition of Alpine Immune Sciences for $4.9 billion in cash. With multiple catalysts and strong forward guidance for 2024, VRTX stock remains one of the top biotech stocks to buy now.
United Therapeutics (UTHR)
United Therapeutics (NASDAQ:UTHR) has been on a tear so far in 2024. The stock is up 20% YTD, driven by the company’s impressive pipeline opportunities and first quarter earnings results.
United Therapeutics often flies under the radar, despite their strong track record and impressive revenue and earnings growth. The company’s main focus is on the treatment of pulmonary arterial hypertension (PAH), a rare and life-threatening lung disease. Their existing therapies, most notably Tyvaso, have significantly improved prognosis for PAH patients. Moreover, the company is actively working on new treatments that could further extend and enhance the lives of those affected. In their latest quarterly results, revenue increased 34% YOY to $677 million. EPS increased 27% YOY to a record $6.17 per share. The company is not only developing new drugs, but exploring novel approaches to drug delivery, such as implantable pumps and inhalable therapies.
Novo Nordisk (NVO)
Novo Nordisk (NYSE:NVO) stands as one of the most compelling biotech stocks to buy in May. The company is leading the charge in GLP-1 therapies, and continues to rake in record profits in 2024.
One of the key factors driving Novo Nordisk’s growth in 2024 is their GLP-1 therapies platform. Their novel therapy, WeGovy, is seeing unprecedented demand and driving record profits for the company. GLP-1 global sales grew 32% YOY in Q1 FY24, and diabetes care was up 24%. The company holds a staggering 55.3% market share in the GLP-1 segment, and saw market share gains of 1.8% in the global diabetes market. They continue to see strong double digit growth in both North American and International Operations, with robust growth in the United States. Additionally, profits have been exploding, with net income up 28% YOY to a record $25.4 billion in the quarter. With exploding free cash flows, NVO stock is well positioned for obesity care, rare disease and cardiovascular portfolios.
On the date of publication, Terel Miles 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.
