You can always find growth opportunities in the biotech sector. I have picked out three biotech stocks with solid fundamentals, compelling growth and prices near all-time highs. Some are introducing new drugs and some are boosting growth through acquisitions.
Celgene Corporation (NASDAQ:CELG), a biopharmaceutical company, discovers, develops, and commercializes various therapies to treat cancer and immune-inflammatory related diseases primarily in the United States and Europe, according to Yahoo Finance. Some of the company's commercial stage products include: Revlimid, Vidaza, Thalomid, Abraxane, Istodax, and it has various preclinical and clinical-stage products.
The company delivered solid and stable growth in recent quarters, and was beating estimates and raising guidance. Earnings growth has ranged from 26% to 43% in previous four quarters, and revenue was up 13% to 18% in the same time period. Trailing PE is 26.69 and forward PE is 17.23, and the PEG ratio is 0.88 according to Yahoo Finance. Earnings growth was 34% in the last five years, and projected 5-year growth is 22%. Analyst EPS forecast has been trending up in the last 90 days, from 1.30 to 1.31 for the current quarter, and from 5.53 to 5.59 for the next year.
The stock broke out this week and rose almost 20%, and is extended at the moment.
Valeant Pharmaceuticals International, Inc. (NYSE:VRX), a specialty pharmaceutical company, develops, manufactures, and markets pharmaceutical products in the areas of neurology, dermatology, and branded generics (source Yahoo Finance). It has managed to grow through various acquisitions and deliver significant revenue and earnings growth.
The company has an adjusted PE of 15.50, and forward PE of 10.67, and a 0.57 PEG ratio, according to Zacks. It has a 5-year projected earnings growth rate of 18.6%. Earnings are projected to grow 63% this year and 34% next year.
The stock has reached new highs recently, after breaking out in late December.
Regeneron Pharmaceuticals Inc.
Regeneron Pharmaceuticals, Inc. (NASDAQ:REGN), a biopharmaceutical company, discovers, develops, and commercializes medicines for the treatment of serious medical conditions in the United States (source Yahoo Finance). The company finally produced positive earnings few quarters ago, and has grown revenues significantly, thanks to its drug Eylea.
Regeneron has no comparable earnings growth rates, since they were negative in the time preceding the last four quarters, and revenue growth has ranged from 108% to 315% in the last three quarters. It has a PE of 83.28, forward PE is 36.48, and the PEG ratio is 0.83, with a 5-year projected earnings growth rate of 63%. Analyst EPS estimates are trending up in the last 90 days, from 0.90 to 1.05 for the current quarter, from 2.68 to 3.48 for the current year, and from 4.35 to 4.92 for the next year, according to Yahoo Finance.
Source: Streetinsider, Yahoo Finance, Ycharts
The stock price is near its all time highs, and it had a tremendous run in 2012, rising 208% for the year.
These three stocks have great fundamentals and offer compelling growth opportunities. Technically, Celgene's price is extended at the moment, Valeant has just broke out, and Regeneron is in a consolidation at the moment, not far from a new breakout to all time highs.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.