Human life expectancy has doubled since the 1900s, mostly attributed to advancements in lifestyle, living standards and medicine. Thanks to biotech companies that produce transformative drugs and treatments, we now have the collective ability to combat diseases that used to bring entire nations down.
And it’s getting better all the time. So, it’s no surprise that investors are looking at biotech stocks to buy. A lot of money is to be made, especially if their prices skyrocket.
However, investing in biotech stocks is not for the faint of heart. They tend to be more volatile than some sectors. But if you can handle it, the potential rewards might be too good to pass up.
To get my list of biotech stocks to buy, I used the following filters:
- A strong buy rating from four or more analysts,
- Full-year revenue growth of at least 10%,
- Full-year earnings growth of at least 10%.
I sorted the list based on revenue growth to find companies that could generate cash from operations to sustain growth rather than rely on debt or additional capital.
Cue Biopharma (CUE)
Cue Biopharma (NASDAQ:CUE) is a clinical-stage biopharmaceutical firm that develops immunotherapies for cancer treatment. It uses biologics and immuno-STAT to harness the body’s curative potential via our intrinsic immune system through disease-specific T-cell modulation. The company has two oncology product candidates, CUE-101 and CUE-102.
According to its full-year filings, Cue Biopharma achieved significant progress in its cancer and autoimmune disease programs. The company announced the advancement of CUE-101 and CUE-102 clinical trials. Also, it has a Food and Drug Administration (FDA) meeting to define a registrational path for CUE-101. In addition, Cue Biopharma shared progress in the CUE-401 autoimmune program and the potential expansion of its autoimmune pipeline with the Immuno-STAT CUE-500 series.
While the company may not be profitable yet, its revenue stream grew spectacularly from $1.26 million in 2022 to $5.49 million in 2023. This represents a 339% increase year-over-year (YOY). Management attributed the growth to its strategic collaboration agreement with Ono Pharmaceutical in the first quarter of 2023.
Cue Biopharma’s continued progress in trials, impressive results and a strong buy rating have earned it a spot on my biotech stocks watchlist.
Ardelyx (ARDX)
Ardelyx (NASDAQ:ARDX) is a biotech company that has developed and marketed two commercial products, IBSRELA and XPHOZAH.
The company has product pipelines under the RDX020 program, which aims to treat metabolic acidosis. And, the RDX013 Program is intended for treating hyperkalemia. Tenapanor, sold under the brand IBSRELA, aims to treat irritable bowel syndrome, while XPHOZAH helps control serum phosphorus in adult patients with CKD on dialysis.
The company’s fiscal year 2023 financials were impressive. Revenue ended at $124.5 million, representing a 138.51% YOY growth from $52.2 million in 2022. Also, net losses improved from 42 cents to 30 cents per share.
With the strong reception and demand for its products and a strong buy rating from analysts, ARDX stock could be a strong growth opportunity for investors looking for exposure in biotech.
Agenus (AGEN)
Agenus (NASDAQ:AGEN) is racing to develop treatments for cancer and infectious diseases. The company’s most advanced antibody candidates are botensilimab and balstilimab. Agenus is scheduled to meet with the FDA in July to secure a Type B End-of-Phase 2 meeting to advance the development of its promising BOT/BAL therapy.
Also, the company reported positive results in its BOT/BAL Phase 1b trial data for colorectal cancer, reporting a 23% RECIST-confirmed ORR and a median overall survival of 21.2 months. Additionally, Agenus is exploring expansion opportunities in other cancers, including pancreas, lung, neoadjuvant CRC and melanoma. It is showing promising early results.
Revenue reached $156 million in fiscal year 2023, growing 59% YOY from 2022’s $98.02 million. And, losses improved from $15.6 per share to $13.8.
Analysts rate AGEN stock as a strong buy based on its decent financial performance and great prospects. Those looking for biotech stocks that can skyrocket should keep their eyes on Agenus.
On the date of publication, Rick Orford 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.