The biotech industry thrived during the pandemic. Moreover, the United States spent the most on biotech research and development in 2020, totaling $88.42 billion. The industry is expected to remain in the limelight as global medical requirements continue to rise. According to Data Bridge Market Research, the biotechnology market is expected to grow at a CAGR of 29% from 2023 to 2030.
Historically, healthcare has outperformed during market downturns, providing a haven for those seeking stability for their portfolios. As recession fears are heightening, investors’ interest in biotech stocks is evident from the iShares Biotechnology ETF’s (IBB) 11.6% gains over three months and 11.3% gains over the past six months.
So, we believe investors might consider buying quality biotech stocks Amgen Inc. (AMGN) and Gilead Sciences, Inc. (GILD) to add a layer of protection to their portfolios.
Amgen Inc. (AMGN)
AMGN discovers, develops, manufactures, and delivers human therapeutics worldwide. It focuses on inflammation, oncology/hematology, bone health, cardiovascular disease, nephrology, and neuroscience areas.
On November 4, 2022, Robert A. Bradway, chairman and CEO, said, “Our medicines generated 8% volume growth in the quarter globally, with 11 products achieving record quarterly sales. This growth reflects the strong underlying demand for our medicines and the value they bring to patients.”
AMGN’s operating income came in at $2.66 billion for the third quarter that ended September 30, 2022, up 11.9% year-over-year. Moreover, the company’s net income came in at $2.14 billion, up 13.7% year-over-year. Also, its EPS came in at $3.98, up 20.2% year-over-year.
AMGN’s revenue is expected to increase 3.6% year-over-year to $27.19 billion in 2023. Its EPS is expected to increase 4.6% year-over-year to $18.47 in 2023. It surpassed EPS estimates in all each of the four trailing quarters. Over the past year, the stock has gained 15.6% to close the last trading session at $263.16.
AMGN’s strong fundamentals are reflected in its POWR Ratings. The stock’s overall B rating equates to a Buy in our proprietary rating system. The POWR Ratings assess stocks by 118 different factors, each with its own weighting.
AMGN has an A grade for Quality and a B grade for Stability. Within the Biotech industry, it is ranked #12 out of 375 stocks. Beyond what is stated above, we’ve also rated AMGN for Sentiment, Growth, Momentum, and Value. Get all the AMGN ratings here.
Gilead Sciences, Inc. (GILD)
Biopharmaceutical company GILD discovers, develops, and commercializes medicines in the areas of unmet medical need in the United States, Europe, and internationally for over three decades.
On December 27, GILD and Jounce Therapeutics, Inc. (JNCE) revised their current license agreement for GS-1811, allowing GILD to buy out any potential future contingent payments due under the license deal signed in August 2020. The GS-1811 announcement underscores GILD’s commitment to its fast-expanding oncology franchise and goal of delivering next-generation cancer medicines.
On December 22, Kite Pharma, Inc., a GILD Company, and Daiichi Sankyo Co., Ltd. (DSNKY) announced that the Japan Ministry of Health, Labour, and Welfare (MHLW) approved Yescarta, a chimeric antigen receptor (CAR) T-cell therapy, for the initial treatment of patients with relapsed/refractory large B-cell lymphoma.
GILD’s trodelvy’s sales came in at $180 million for the third quarter that ended September 30, 2022, up 78.2% year-over-year. The company’s current liabilities came in at $10.42 billion for the period ended September 30, 2022, compared to $11.61 billion for the period ended December 31, 2021.
Also, its total liabilities and equity came in at $62.56 billion, compared to $67.95 billion for the same period.
Street expects GILD’s EPS to increase 115.9% year-over-year to $1.49 for the quarter ending December 2022. It surpassed EPS estimates in three of the four trailing quarters. Over the past nine months, the stock has gained 40.8% to close the last trading session at $85.26.
GILD’s overall A rating equates to a Strong Buy in our POWR Ratings system. It has an A grade for Sentiment and a B for Value and Quality. It is ranked #3 in the same industry. We’ve also rated GILD for Momentum, Growth, and Stability. Get all GILD ratings here.
AMGN shares were trading at $260.12 per share on Friday afternoon, down $3.04 (-1.16%). Year-to-date, AMGN has gained 19.28%, versus a -18.96% rise in the benchmark S&P 500 index during the same period.
About the Author: RashmiKumari
Rashmi is passionate about capital markets, wealth management, and financial regulatory issues, which led her to pursue a career as an investment analyst. With a master's degree in commerce, she aspires to make complex financial matters understandable for individual investors and help them make appropriate investment decisions.
Consider Buying These 2 Biotech Stocks Before 2023 StockNews.com
