Due to their sometimes speculative nature, biotech stocks are especially sensitive to broader market corrections like the one experienced last week. This can be exceptionally stressful for investors, especially those who bought into biotech stocks at overbought points in the stocks’ trading cycle. However, where sell0offs occur, so too do steep discounts for better value buys.
Moreover, while last Monday’s sell-off hinted at a potentially volatile market moving forward, American markets recovered quickly, with biotech stocks experiencing some of the buying momentum. Whether or not the volatility will continue is difficult to predict, but for investors considering a position in the market’s biotechnology contributors, the ideal investment decisions rely on waiting for the right moment to buy before a comeback.
Ultimately, the following biotech stocks represent strong investments regardless of the current market zeitgeist, be it bear or bull, due to their contributions to global health and addressing critical health needs.
Novo Nordisk (NVO)
Riding on the tremendous success of its weight loss and diabetes drugs, Novo Nordisk (NYSE:NVO) has felt some uncertainties due to its supply constraints. The Danish biotech remains the market leader with its share of the GLP-1 market despite a recent sales miss that tumbled the stock before the market correction. Now its CEO, Lars Jørgensen, has stated the company has 69% of the global GLP-1 market share, with Ozempic making up 46% of the market.
Alongside this dominance, NVO is set to invest $11 million in expanding its manufacturing operations in North Carolina to meet the growing demand for its products. This expansion is part of Novo Nordisk’s broader financial strategy, which has already delivered significant results.
In Q2 2024, the company reported a year-over-year revenue increase of 25% to reach 68.06 billion DKK for the quarter. This strong performance also led to a 3.2% rise in net income, reaching 20.05 billion DKK for the quarter. As Novo Nordisk’s cash reserves continue to grow, so does its capacity to scale up drug manufacturing, particularly as the obesity epidemic intensifies in the U.S.
Moderna (MRNA)
As its ticker suggests, Moderna (NYSE:MRNA) is a leading vaccine producer specializing in mRNA technology. What makes this technology particularly exciting is its potential to serve as a prophylactic to various viruses beyond just COVID-19. The mRNA approach enables precise targeting of specific proteins for the immune system, such as the spike proteins on the surface of a virus. This allows Moderna to train the body to recognize these proteins, preparing it to fight off infections effectively.
This adaptability makes Moderna’s mRNA vaccine highly versatile, capable of being quickly modified to combat whatever virus may emerge in the future. This gives Moderna stock a significant advantage should another health crisis arise, requiring rapid vaccine development similar to the response seen in 2020. For investors looking to bet on the next health crisis, Moderna is likely one of the top biotech stocks to consider.
Regeneron (REGN)
Regeneron (NYSE:REGN) gained significant attention during the COVID-19 pandemic for its monoclonal antibodies, sparking widespread interest in the potential applications of its biotechnology. However, beyond its impressive scientific achievements, investors should also note that the company has been led by the same CEO, Leonard Schleifer, since its founding in 1988.
This leadership helped the company achieve impressive second-quarter results for 2024 as it recently reported a revenue of $3.55 billion, representing a 12.32% growth year-over-year. This helped support a net income of $1.43 billion, which came in at a stunning 47.9% growth year-over-year. Investors were ultimately rewarded with a strong EPS growth of 46%, coming in at $12.41.
With increases in revenue, net income, and profit margins, Regeneron’s substantial beats on EPS and revenue guidance set it on a strong path for the remainder of 2024. Looking beyond the short term, Regeneron’s ongoing commitment to strong leadership and scientific excellence makes it one of the top long-term healthcare stocks to consider.
On the date of publication, Viktor Zarev 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.
