Three U.S. Pharmaceutical Stocks to Buy

Emma Flynn

[blue capsules spilling out of a bottle]

Three U.S. pharmaceutical stocks to buy show potential for profit as the healthcare and wellness market continues to grow.

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Amid aging populations and new treatments for obesity, cell and gene therapies, cardiovascular treatments and more, the pharmaceutical industry continues to make money for investors.

The U.S. population’s demographic is shifting to a larger older population. According to the Population Reference Bureau, the U.S. population is older today than it has ever been. The number of Americans ages 65 and older is projected to increase from 58 million in 2022 to 82 million by 2050. The 65-and-older’s share of the population in 2050 is predicted to rise from 17% to 23%.

With that, investors can expect to see the pharmaceutical and healthcare industry continue to innovate, as an older population typically brings about many health concerns.

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According to Forbes, personalized medicine is one of the divisions that has seen an increase in production. Personalized medicine, as implied by its name, is based on the individual genetic makeup of a patient. In 2005, this type of medicine accounted for just 5% of new drugs approved by the U.S. Food and Drug Administration. In 2022, it made up 34%.

By investing in the realm of healthcare and medical research, investors can see the real-world impacts of what their money is doing while also making a profit in the meantime.

According to a report from ZS.com, a management and technology consulting firm, even with various challenges the market may face, 2024 could be the start of a renaissance that provides for a healthier world.

Three U.S. Pharmaceutical Stocks to Buy: Eli Lilly (LLY)

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Eli Lilly is a pharmaceutical company based in Indianapolis, Indiana, with a focus on neuroscience, cardiometabolic, cancer and immunology. Today, it is one of the world’s largest pharmaceutical companies with a line of successful new drugs.

Eli Lilly has been working to create drugs and treatments for several types of diseases that are not only common, but deadly in the United States, including diabetes and now Alzheimer’s.

Some of its main products include Verzenio for cancer, Mounjaro, Zapbound, Jariance and other drugs for diabetes, and Taltz and Olumiant for immunology. The company also just signed an agreement to pay $3.2 billion to acquire Morphic Holding, which expands its inflammatory bowel disease portfolio, according to Pharmaceutical Technology.

According to yahoo finance, shares of the company are up 1% over the past one week and up 7.6% over the past four weeks. As for earnings, analysts revised their earnings estimate higher in the last 60 days for the company, with the Zacks Consensus Estimate increasing from 24 cents to $13.61 per share. Eli Lilly has a 57.8% year-to-date total return.

Among 21 analysts who cover Eli Lilly, StockRover.com indicated the consensus gives this company a rating of Strong Buy.

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Chart courtesy of stockcharts.com.

Among 21 analysts who cover Eli Lilly, StockRover.com indicated the consensus gives this company a rating of Strong Buy.

Three U.S. Pharmaceutical Stocks to Buy: Merck & Co., Inc. (NYSE: MRK)

Merck & Co., Inc. (MRK) is a pharmaceutical company headquartered in Rahway, New Jersey. It makes pharmaceutical products for several conditions in many therapeutic areas, including cardiometabolic disease, infections and cancer.

Merck & Co., Inc. is a player in the vaccine industry, as the company has treatments to prevent pediatric diseases and human papillomavirus (HPV).

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In addition to the company’s substantial vaccine business, the firm’s immune-oncology platform is growing to be a major contributor to overall sales.

Despite its headquarters in New Jersey, the company has a large global presence. From a geographical standpoint, just under half of the company’s sales are generated in the United States.

Chart courtesy of stockcharts.com.

From a distribution of 23 analysts at stockrover.com, the consensus gives Merck a rating of STRONG BUY.

Three U.S. Pharmaceutical Stocks to Buy: AbbVie (NYSE: ABBV)

AbbVie (NYSE: ABBV) is a pharmaceutical firm headquartered in North Chicago, Illinois, that has both strong exposure to immunology and oncology. The company spun off from Abbott Laboratories, a health care technology company, in 2013. In 2020, AbbVie acquired Allergan, which added several new aesthetics, like Botox, and related products to its already dense catalog.

The company offers many other treatments and drugs, including Skyrizi and Rinvoq. Skyrizi has been profitable for the company, as the injection for psoriasis and inflammatory bowel disease helped first-quarter sales jump 48% year-over-year to an annualized $8 billion.

According to a press release from the company, AbbVie will announce its second-quarter 2024 financial results on Thursday, July 25, 2024, before the market opens that day.

ABBV has a year-to-date total return of 9.4% and a one-year return of 26.2%.

From a distribution of 22 analysts, stockrover.com rates AbbVie a BUY.

Chart courtesy of stockcharts.com.

The Pharmaceutical Industry Is Ever Evolving

The pharmaceutical industry has remained a key place for investors to watch. In an investment column by Paul Dykewicz, he discussed multiple other investing opportunities within the sector.

Pharmaceutical companies and the industry have faced issues in adapting to structural changes. According to an article from Forbes, problems have arisen from the increased consolidation in healthcare delivery and a shift in power dynamics within the health care sphere.

Bob Carlson, who leads the Retirement Watch investment newsletter, also shared his thoughts on the industry with Dykewicz.

“I still believe biotech and pharmaceuticals will do well, though they haven’t done well recently,” Carlson told him. “The companies continue to develop new, innovative products.”

Bob Carlson, head of Retirement Watch, gives an interview to Paul Dykewicz.

While the healthcare market is under-performing in year-to-date returns compared to the market, these three pharmaceutical stocks to buy show promise with their consistent innovation.

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