The U.S. biotech sector is experiencing significant growth, fueled by groundbreaking advancements in genetic therapies, personalized medicine, and immunotherapy. As the industry continues to push the boundaries of medical innovation, companies driving breakthroughs in gene therapy and genetic treatments are gaining attention.

Therefore, solid biotech stocks Gilead Sciences, Inc. (GILD), Vertex Pharmaceuticals Incorporated (VRTX), and Regeneron Pharmaceuticals, Inc. (REGN) coulc be ideal buys.

U.S. biotech stocks are primarily driven by advancements in medical research, regulatory approvals, and the ongoing demand for innovative treatments. Breakthroughs in gene therapy, personalized medicine, and immunotherapy are central to investor optimism, as these areas offer potential to address previously untreatable diseases.

Gene therapies are rapidly transforming the landscape of healthcare, offering the potential to cure or significantly improve the treatment of a wide array of diseases. By directly addressing the root causes of genetic disorders through the modification or replacement of defective genes, these therapies provide long-term or even permanent solutions for conditions that were once considered untreatable. The global biotechnology market, which was valued at $1.55 trillion in 2024, is projected to reach $4.61 trillion by 2034, at a CAGR of 11.5%.

Considering this growing trajectory, let’s discuss further about the Biotech stocks:

Stock #3: Vertex Pharmaceuticals Incorporated (VRTX)

VRTX is a leading biotech company that focuses on treatments for cystic fibrosis and other conditions, including sickle cell disease, diabetes, and cancer, with key products like TRIKAFTA and a diverse clinical pipeline.

In the fiscal third quarter that ended September 30, 2024, VRTX’s net product revenues increased 11.6% year-over-year to $ 2.77 billion. Its non-GAAP operating income grew 11.4% from the year-ago value to $1.31 billion. In addition, the non-GAAP net income came in at $ 1.14 billion and $4.38 per share, up 7.5% and 7.4% over the prior-year quarter, respectively.

Street expects VRTX’s revenue for the fiscal fourth quarter (ending December 31, 2024) to increase 10.6% year-over-year to $ 2.79 billion. Its EPS for the same quarter is expected to be $4.06. In addition, it surpassed the consensus revenue and EPS estimates in three of the trailing four quarters, which is promising.

The stock plunged down to 4% in the past year to close the last trading session at $402.49.

VRTX’s POWR Ratings reflect its robust outlook. The stock has an overall rating of B, equating to a Buy in our proprietary rating system. The POWR Ratings are calculated by considering 118 distinct factors, with each factor weighted to an optimal degree.

VRTX has a B grade in Value. It is ranked #33 out of 336 stocks in the Biotech industry.

Beyond what we have stated above, we also have given VRTX grades for Growth, Momentum, Stability, Sentiment, and Quality. Get all the VRTX’s ratings here.

Stock #2: Regeneron Pharmaceuticals, Inc. (REGN)

REGN develops and commercializes medicines for various diseases, including eye disorders, asthma, cancer, and rare conditions. Key products include EYLEA, Dupixent, and Libtayo, alongside advanced research in gene editing and T cell therapies through collaborations.

On December 19, REGN announced positive Phase 2 results for its monoclonal antibodies REGN7508 and REGN9933, targeting distinct domains of Factor XI. The results demonstrated strong antithrombotic effects with no clinically relevant bleeding, offering promising anticoagulant options for patients at varying bleeding risks.

During the fiscal third quarter that ended September 30, 2024, REGN’s revenues increased 10.6% year-over-year to $ 3.72 billion. Its income from operations grew 6.1% from the year-ago value to $ 1.18 billion. In addition, the company’s non-GAAP net income and non-GAAP net income per share came in at $ 1.46 billion and $12.46, up 10% and 7.5% over the prior-year quarter, respectively.

Street expects REGN’s revenue and EPS for the year ending December 31, 2024, to increase 8.1% and 2.9% year-over-year to $ 14.18 billion and $45.07, respectively. In addition, it surpassed the consensus revenue and EPS estimates in three of the trailing four quarters.

Shares of REGN have gained marginally year-to-date to close the last trading session at $716.26.

REGN’s POWR Ratings reflect its robust outlook. The stock has an overall rating of B, equating to a Buy in our proprietary rating system.

It has a B grade in Value, Sentiment, and Quality. It is ranked #21 in the same industry.

Click here to see REGN’s ratings for Growth, Momentum, and Stability.

Stock #1: Gilead Sciences, Inc. (GILD)

GILD is a biopharmaceutical company specializing in treatments for HIV/AIDS, COVID-19, viral hepatitis, oncology, and pulmonary hypertension. Its key products include Biktarvy, Veklury, and Yescarta, and it collaborates with several partners to advance research and innovative therapies.

On December 17, GILD and Terray Therapeutics, Inc. announced a strategic collaboration aimed at discovering and developing innovative small molecule therapies targeting multiple disease areas. This partnership underscores Gilead’s commitment to expanding its therapeutic portfolio through cutting-edge scientific alliances.

On November 14, GILD announced the pricing of $3.5 billion in senior unsecured notes, with varying maturities from 2029 to 2064. The offering is expected to close on November 20, 2024, and will support the company’s financial strategies and growth initiatives.

It pays an annual dividend of $3.08, which translates to a dividend yield of 3.33% at the prevailing price levels. Its four-year average dividend yield is 4.05%. The company has grown its dividend payment at a CAGR of 4.1% over the past five years.

GILD’s total revenues increased 7% year-over-year to $7.55 billion in the fiscal third quarter that ended on September 30, 2024. Its non-GAAP operating income came in at $3.26 billion, up 1.1% year-over-year. Moreover, its non-GAAP net income attributable to Gilead and non-GAAP earnings per share attributable to Gilead stood at $2.53 billion and $2.02, respectively, over the previous quarter.

Street expects GILD’s revenue for the fiscal fourth quarter (ending December 31, 2024) to increase marginally year-over-year to $7.16 billion. Its EPS for the same quarter is likely to be $1.72. In addition, it surpassed the consensus revenue estimates in each of the trailing four quarters.

Shares of GILD have gained 8.6% over the past year and 35.1% over the past six months to close the last trading session at $91.23.

GILD’s bright prospects are apparent in its POWR Ratings. The stock has an overall rating of A, which translates to a Strong Buy in our proprietary rating system.

It has an A grade for Sentiment and a B for Value, Growth, and Quality. It tops the same industry.

Click here to see GILD’s ratings for Momentum and Stability.

What To Do Next?

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GILD shares fell $0.41 (-0.45%) in premarket trading Tuesday. Year-to-date, GILD has declined -1.23%, versus a 1.58% rise in the benchmark S&P 500 index during the same period.

About the Author: Kritika Sarmah

Her interest in risky instruments and passion for writing made Kritika an analyst and financial journalist. She earned her bachelor's degree in commerce and is currently pursuing the CFA program. With her fundamental approach, she aims to help investors identify untapped investment opportunities. More...

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