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10 Biotech Stocks to Buy According to Billionaire Ken Fisher

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·9 min read
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In this article, we discuss the 10 biotech stocks to buy according to billionaire Ken Fisher. If you want to skip our detailed analysis of these stocks, go directly to the 5 Biotech Stocks to Buy According to Billionaire Ken Fisher.

Ken Fisher is among a rare breed of “self-made” billionaires on Wall Street, having grown his fund, Fisher Asset Management, from just a few hundred dollars over four decades ago to $160 billion in portfolio value at the end of the third quarter of 2021. Fisher, whose real-time net worth stands at around $6.3 billion, is a true “all-rounder” in every sense of the word. While leading one of the biggest investment firms in the world — between 1997 and 2015, his fund outperformed the benchmark S&P 500 by over 4 percentage points — he wrote eleven books, six of which were best-sellers, and conducted research worthy of publication in reputed scholarly journals.

Fisher has a large social media following, evidenced by the hundreds of thousands who follow him on networking platform Twitter. Fisher uses the platform to occasionally outline his view on the broader economy. Recently, the veteran investor underlined how analysts might be “overemphasizing” the impact that rising energy prices would have on the overall market. He noted that energy as a percentage of the GDP was falling in most parts of the world and countries were becoming more energy-efficient.

Those who want a deeper dive into the investment philosophy of Fisher and the action that follows it should take a closer look at the latest portfolio of Fisher Asset Management. Some of the stocks in the portfolio of the fund at the end of September included Apple Inc. (NASDAQ:AAPL), Microsoft Corporation (NASDAQ:MSFT), Amazon.com, Inc. (NASDAQ:AMZN), and Alphabet Inc. (NASDAQ:GOOG), among others discussed in detail below.

Our Methodology

These stocks were picked from the investment portfolio of Fisher Asset Management at the end of the third quarter of 2021. The analyst ratings and business fundamentals of the firms are also discussed to provide readers with some context for their investment choices. Hedge fund sentiment was used as a classifier as well.

The hedge fund sentiment around each stock was calculated using the data of 867 hedge funds tracked by Insider Monkey.

Biotech Stocks to Buy According to Billionaire Ken Fisher

10. Sanofi (NASDAQ:SNY)

Number of Hedge Fund Holders: 19

Sanofi (NASDAQ:SNY) is a healthcare company that develops and markets therapeutics solutions. Latest data shows that Fisher Asset Management owned 17.9 million shares of Sanofi (NASDAQ:SNY) at the end of the third quarter of 2021 worth $863 million.

HSBC analyst Steve McGarry recently upgraded Sanofi (NASDAQ:SNY) stock to Buy from Hold and raised the price target to EUR100 from EUR89, underlining the increasing operating leverage of the firm that would result in higher margins for the next few years.

At the end of the third quarter of 2021, 19 hedge funds in the database of Insider Monkey held stakes worth $1.28 billion in Sanofi (NASDAQ:SNY), up from 16 the preceding quarter worth $1.26 billion.

Just like Apple Inc. (NASDAQ:AAPL), Microsoft Corporation (NASDAQ:MSFT), Amazon.com, Inc. (NASDAQ:AMZN), and Alphabet Inc. (NASDAQ:GOOG), Sanofi (NASDAQ:SNY) is one of the stocks attracting the attention of elite investors.

In its Q4 2020 investor letter, Artisan Partners Limited Partnership, an asset management firm, highlighted a few stocks and Sanofi (NASDAQ:SNY) was one of them. Here is what the fund said:

“Top detractors in Q4 included Sanofi. This defensive security was out of favor as vaccine distribution started in earnest and the market shifted focus to a post-COVID world. Sanofi performed about in line with other global pharmaceuticals companies. We believe Sanofi’s management team will have success improving the pipeline and managing costs through restructuring. For perspective, Swedish Match was down ~4% in the quarter but provided a 54% total return for 2020.”

9. Novartis AG (NYSE:NVS)

Number of Hedge Fund Holders: 22

Novartis AG (NYSE:NVS) makes and sells healthcare products across the world. According to regulatory filings, Fisher Asset Management owned 10.3 million shares in Novartis AG (NYSE:NVS) at the end of September 2021 worth $842 million.

On December 2, Novartis AG (NYSE:NVS) announced that it was expecting sales growth of at least 4% for the next five years, driven by the demand for new drugs. The firm expects 20 new assets with sales potential of more than $1 billion to be approved in the period.

At the end of the third quarter of 2021, 22 hedge funds in the database of Insider Monkey held stakes worth $1.4 billion in Novartis AG (NYSE:NVS), the same as in the preceding quarter worth $1.7 billion.

In its Q4 2020 investor letter, Oakmark Funds, an asset management firm, highlighted a few stocks and Novartis AG (NYSE:NVS) was one of them. Here is what the fund said:

“Novartis is one of Europe’s largest pharmaceutical companies and possesses a highly diversified portfolio of innovative products. Its share price underperformed both the broader market and its pharma peers during 2020, largely due to a few disappointing late-stage trials and the company’s lack of Covid-19-related therapeutics or vaccines. These short-term issues provided us with an attractive entry point to invest in a leading pharmaceutical franchise with compelling economics. We estimate that the market is currently ascribing almost no value to Novartis’ pipeline despite the company’s excellent track record in new drug development. We expect that Novartis will deliver mid-single-digit, top-line growth and expand margins over the next five years as a result of its cost-savings plan. The company possesses one of the most diversified product portfolios in the pharma industry with 15 $1b+ compounds, which reduces its reliance on any single compound.”

8. Novo Nordisk A/S (NYSE:NVO)

Number of Hedge Fund Holders: 27

Novo Nordisk A/S (NYSE:NVO) is a Denmark-based healthcare firm. The hedge fund of billionaire Ken Fisher owned 16 million shares of Novo Nordisk A/S (NYSE:NVO) at the end of the third quarter of 2021 worth more than $1.5 billion.

On November 11, investment advisory UBS reiterated a Neutral rating on Novo Nordisk A/S (NYSE:NVO) stock and raised the price target to DKK725 from DKK630. Analyst Michael Leuchten issued the ratings update.

At the end of the third quarter of 2021, 27 hedge funds in the database of Insider Monkey held stakes worth $4 billion in Novo Nordisk A/S (NYSE:NVO), up from 20 in the previous quarter worth $3 billion.

In addition to Apple Inc. (NASDAQ:AAPL), Microsoft Corporation (NASDAQ:MSFT), Amazon.com, Inc (NASDAQ:AMZN) and Alphabet Inc. (NASDAQ:GOOG), NVO is an important stock pick of Ken Fisher.

In its Q3 2021 investor letter, LRT Capital Management highlighted a few stocks and Novo Nordisk A/S (NYSE:NVO) was one of them. Here is what the fund said:

“Novo Nordisk is the global leader in insulin, which is, sadly, a growing business as more and more people around the world suffer from diabetes. millions of people need daily injections of insulin to stay alive54, a number that, unfortunately, is likely to continue to grow by millions more in the coming decade. It may seem at first glance that insulin should be a commoditized business, after all, it was discovered and synthesized over a hundred years ago, but nothing could be further from the truth. There are many types of insulin and Novo Nordisk has spent billions on R&D over the years to develop new products. On February 11th, the company reported favorable results from a phase-3 trial of Semaglutide, a drug that is currently used for Type 2 diabetes treatment. The study evaluated the use of Semaglutide for weight loss treatment in non-diabetic patients and found a significant impact on weight loss for patients receiving Semaglutide vs. the placebo control group. If Semaglutide is approved for weight loss treatment, we expect it will be meaningfully accretive to the company’s bottom line.

The company’s proprietary product line supports returns on invested capital of over 40%, and while sales growth is relatively slow (+6% annualized CAGR over the past decade), the company’s shares trade at a reasonable valuation of only 22x forward earnings. For a company with an extremely predictable business, high returns on capital, and an easily forecastable future, we believe this to be highly attractive.”

7. Bio-Rad Laboratories, Inc. (NYSE:BIO)

Number of Hedge Fund Holders: 38

Bio-Rad Laboratories, Inc. (NYSE: BIO) markets life science research and clinical diagnostic products. Fisher Asset Management owned 145,815 shares in Bio-Rad Laboratories, Inc. (NYSE: BIO) at the end of September 2021 worth $108 million.

Bio-Rad Laboratories, Inc. (NYSE: BIO) recently posted earnings for the third quarter, reporting earnings per share of $3.71, beating market estimates by $1.23. The revenue over the period was $747 million, up 15% year-on-year.

At the end of the third quarter of 2021, 38 hedge funds in the database of Insider Monkey held stakes worth $1.4 billion in Bio-Rad Laboratories, Inc. (NYSE: BIO), down from 41 in the previous quarter worth $1.2 billion.

6. AstraZeneca PLC (NASDAQ:AZN)

Number of Hedge Fund Holders: 41

AstraZeneca PLC (NASDAQ:AZN) makes and sells prescription medicines. Latest securities filings reveal that Fisher Asset Management owned 19.5 million shares in AstraZeneca PLC (NASDAQ:AZN) at the end of the third quarter of 2021 worth $1.1 billion.

Reports in the media suggest that AstraZeneca PLC (NASDAQ:AZN) is considering the public listing of the new vaccine division of the firm. The firm already expects a small profit from the sale of COVID-19 vaccines over the past few months.

At the end of the third quarter of 2021, 41 hedge funds in the database of Insider Monkey held stakes worth $3.7 billion in AstraZeneca PLC (NASDAQ:AZN), up from 37 in the previous quarter worth $2.7 billion.

Alongside Apple Inc. (NASDAQ:AAPL), Microsoft Corporation (NASDAQ:MSFT), Amazon.com, Inc. (NASDAQ:AMZN), and Alphabet Inc. (NASDAQ:GOOG), AstraZeneca PLC (NASDAQ:AZN) is one of the stocks that hedge funds are buying.

In its Q4 2020 investor letter, Baron Health Care Fund, an asset management firm, highlighted a few stocks and AstraZeneca PLC (NASDAQ:AZN) was one of them. Here is what the fund said:

“AstraZeneca PLC is a multinational pharmaceutical company developing drugs across multiple therapeutic areas such as oncology and respiratory diseases. Shares were impacted by news of AstraZeneca’s joint development with Oxford University of a viral-based COVID-19 vaccine. Given a mixed data set due to an unforeseen error in dosing that occurred in the Brazilian market, the vaccine timelines slipped, hurting share performance. Our investment thesis on AstraZeneca is not dependent on COVID-19 but rather its best-in-class large-cap growth profile, and we retain conviction.”

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Disclosure. None. 10 Biotech Stocks to Buy According to Billionaire Ken Fisher is originally published on Insider Monkey.