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Price is important. This is true whether you’re talking about cars, houses, laptops, or anything else including stocks.
Three Motley Fool contributors kept price in mind when choosing products. Axsum Therapeutics (NASDAQ:AXSM), CRISPR Therapeutics (NASDAQ:CRSP)and pfizer (New York Stock Exchange: PFE) It is currently listed as a top pick for investors. Here’s why they think buying these very cheap stocks could be a great move.
The market continues to undervalue this stock
Prosper Junior Bakinny (Axsome Therapeutics): It is difficult to evaluate biotechnologies that are relatively small and unprofitable with a small number of products. This description fits his Axsome Therapeutics, but in my view there are plenty of clues that lead me to believe that the company’s $3.7 billion market cap is too low compared to its growth potential. Axsome Therapeutics has a rich late-stage pipeline that should help transform its lineup over the next few years.
One of Axsome Therapeutics’ two approved products, the depression treatment Auvelity, is being tested in a Phase 3 study to treat Alzheimer’s disease (AD) agitation. Developing any kind of Alzheimer’s disease treatment has been extremely difficult. And as the population ages, the number of Alzheimer’s patients, including those who suffer from agitation, will increase. There were 6.7 million people with Alzheimer’s disease in the United States last year, and that number could rise to 14 million by 2060, about 70% of whom suffer from agitation.
Things are looking good for Overity, which has already achieved success in one late-stage clinical trial in Alzheimer’s disease excitability. But that’s just the tip of the iceberg. Axsome Therapeutics has a rich pipeline and could have five products commercially available by the end of next year. Even if all of these programs fail, Axsome Therapeutics has significant upside potential.
And just as importantly, the company is building a strong foundation for the long term. Investors looking for cheap biotech stocks need look no further than Axsome Therapeutics.
CRISPR is a stock with long-term potential
david jagielski (CRISPR Therapeutics): The gene therapy market is a lucrative area for investors to focus on. According to estimates by Grand View Research, the global gene therapy market is expected to grow at a compound annual growth rate (CAGR) of 19.5% through the end of the 2010s. And if you want exposure to that market, low-priced stocks like CRISPR Therapeutics could be a great long-term option.
CRISPR is valued at less than $6 billion, making it a stock that looks cheap given the business’ potential for even greater growth. With the approval of Kasgebi’s gene therapy, the company has the potential for significant long-term growth. I think CRISPR Therapeutics has a great asset in its portfolio called Casgevy. The treatment, which costs more than $2 million, is still considered cost-effective, according to medical analysts.
It is necessary to share profits with development partners, vertex pharmaceuticalsApproval of Kasugebi as a treatment for sickle cell disease and beta-thalassemia should provide significant growth opportunities for CRISPR, strengthening its finances in the process. With limited revenue, CRISPR has posted losses in three of the past four quarters. However, if its financial situation improves, its valuation should rise in the future.
CRISPR Therapeutics offers an innovative treatment for Kasugebi. With more treatments in development, this is a stock that investors may regret not buying at current prices.
There’s a reason it’s cheap, but it’s only for the season.
Keith Speights (Pfizer): Select the desired forward-looking metrics. Pfizer stock probably looks attractive. My personal favorite is that this pharmaceutical giant has an extremely low price-to-earnings (PEG) ratio of 0.27.
Indeed, there is a reason why Pfizer is cheap. Sales of the company’s new coronavirus vaccine “Comilnati” and oral treatment drug “Paxrobid” continue to decline. Additionally, Pfizer faces a patent cliff in the coming years, with several of its key drugs losing patent protection from competitors.
However, I think this pharmaceutical stock will only be cheap for one season. why? Despite the challenges, Pfizer should be able to achieve solid growth.
The company projects annual revenue of $25 billion by 2030, driven by new product launches that will conclude by the middle of this year. This more than makes up for the estimated $17 billion in lost revenue from off-patent drugs.
Pfizer expects the business development agreement to add an additional $20 billion in new revenue by 2030. This doesn’t seem far-fetched considering the Biohaven and Seagen acquisitions have already been completed. Overall, the company projects that revenue will increase at a CAGR of approximately 10% between 2025 and 2030.
Pfizer, on the other hand, offers an impressive dividend yield of over 6%. Stock prices don’t have to rise significantly for investors to enjoy large total returns. With an attractive valuation, solid growth prospects, and high dividend yield, I think acquiring Pfizer is a really great decision.
Should you invest $1,000 in Axsome Therapeutics right now?
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David Jagielski has no position in any stocks mentioned. Keith Speights has positions in Pfizer and Vertex Pharmaceuticals. Prosper Junior Bakiny has a position at his Vertex Pharmaceuticals. The Motley Fool has positions in and recommends Axsome Therapeutics, CRISPR Therapeutics, Pfizer, and Vertex Pharmaceuticals. The Motley Fool has a disclosure policy.
“Buying These Dirt-Cheap Stocks Could Be a Brilliant Move” was originally published by The Motley Fool
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