Two Biopharmaceutical Growth Stars
Growth investing has changed a lot since I started in the 80s, especially in terms of which sectors are driving earnings and revenue growth. Back then, one of the core parts of any growth investors' portfolio included fast-growing biotech and drug stocks, such as Genentech (DNA) or Amgen (AMGN) that were consistently provided yearly revenue and earnings growth of over 20%. Now this sector seems to be lacking of these sorts of profitable, fast-growing opportunities.
It seems there are only two sorts of stocks in these sectors. On one end you have the huge drug firms, Including Pfizer (PFE) and Eli Lilly (LLY), whose blockbuster drugs are losing patent protection leaving their pipelines somewhat bare. Plus, they are engaged in myriad restricting efforts. They only attract value and dividend investors drawn to their low valuations and high dividends. On the other end of the spectrum is a surfeit of small biotech stocks that have some interesting drugs in phase trials, but are burning through cash and whose profits, if any, are far out in the future. These stocks are bought by speculative players who are hoping to hit home runs and willing to have plenty of strikeouts along the way....312 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.
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