Based on key financial metrics such as the price-to-sales ratio, shareholder yield and the price-earnings ratio, the following 7 stocks made the list for top value stocks in the Biotechnology industry. Those looking for value stocks to add to their portfolio may want to use this list as a starting point for further investment research.

Why Focus on Undervalued Biotechnology Stocks?

Value investors seek to buy stocks at a discount to their intrinsic value. Long-term returns show that such strategies are advantageous. Value stocks, as a group, tend to outperform growth stocks over extended periods of time. Typically, value investors perform financial analysis of numerous metrics, don’t follow the herd and are long-term investors.

AAII’s A+ Investor Value Grade is derived from a stock’s Value Score. The Value Score is the percentile rank of the average of the percentile ranks of the price-to-sales ratio, price-earnings ratio, enterprise-value-to-EBITDA (EV/EBITDA) ratio, shareholder yield, price-to-book-value ratio and price-to-free-cash-flow ratio. The score is variable, meaning it can consider all six ratios or, should any of the six ratios not be valid, the remaining ratios that are valid. To be assigned a Value Score, stocks must have a valid (non-null) ratio and corresponding ranking for at least two of the six valuation ratios.

What Goes Into AAII’s Value Grade?

Stock evaluation requires access to huge amounts of data as well as the knowledge and time to sift through it all, make sense of financial ratios, read income statements and analyze recent stock movement. AAII created A+ Investor, a robust data suite that condenses data research in an actionable and customizable way suitable for investors of all knowledge levels, to help investors with that task.

AAII’s proprietary stock grades come with A+ Investor. These offer intuitive A–F grades for more than just value. It is possible for a stock to appear cheap based on one valuation metric but appear expensive on another. It is also possible for one valuation ratio to be associated with outperforming stocks during certain periods of time but not others. Some stocks may even have null values for certain metrics like the price-earnings ratio or the price-to-book ratio but not others. An example of this would be a company with losses instead of profits or a negative book value because of heavy borrowing. Negative earnings or book value result in non-meaningful ratios that are left blank or null.

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7 Undervalued Biotechnology Stocks

Of course, there are countless value stocks that are worth mentioning, but this is a concise list of the top 7 undervalued stocks in the Biotechnology industry for Tuesday, October 22, 2024. Let’s take a closer look at their individual scores to see how they measure up against each other and the Biotechnology industry median.

The Value Grade is assigned based on how each stock’s composite valuation compares to all other stocks.

The process for assigning grades starts with each variable for a given stock. The percentile rankings for all valid ratios that a stock has are calculated. So, for instance, a stock could have a price-to-book ranking in the 43rd percentile, a price-earnings ranking in the 67th percentile, a price-to-sales ranking in the 23rd percentile, etc. Then, those rankings are averaged for each stock. (A minimum of two valid variables are required, though all six will be used if available.)

Once the average of the individual variables is calculated, that average is ranked against all stocks. Put another way, each stock’s composite valuation is compared to all other stocks. These ranks are then sorted into quintiles from the cheapest 20% (a grade of A) to the most expensive 20% (a grade of F).

As always, we recommend that you conduct proper due diligence and research before investing in any security. We also suggest that investors utilize numerous grades, not just value, when it comes to deciding whether a company is a good fit for their allocation needs.

Achilles Therapeutics plc’s Value Grade

Value Grade:

Achilles Therapeutics plc, a biopharmaceutical company, develops precision T cell therapies to treat solid tumors. Its platform identifies mutations formed early in the development of cancer. The company offers PELEUS, a proprietary AI-powered bioinformatics platform, used to identify clonal neoantigens in a patient. It also develops CHIRON, which is in Phase I/IIa clinical trial for use in the treatment of advanced non-small cell lung cancer; and THETIS, a product candidate in Phase I/IIa clinical trial for use in the treatment of metastatic or recurrent melanoma. The company was formerly known as Achilles TX Limited and changed its name to Achilles Therapeutics Plc in February 2021. Achilles Therapeutics Plc was founded in 2016 and is headquartered in London, the United Kingdom.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Achilles Therapeutics plc has a Value Score of 92, which is considered to be undervalued.

Now, let’s assess Achilles Therapeutics plc’s EV/EBITDA ratio, also known as enterprise multiple. At 1.2, when compared to the industry median of 0.8, the company may be considered overvalued in relation to its peers. Value investors could use the enterprise multiple to identify stocks that are considered overvalued or undervalued relative to their industry.

Shareholder yield is the sum of a stock’s dividend yield (paid over previous 12 months minus special dividends) and the percentage of net share buybacks over the previous 12 months. Achilles Therapeutics plc’s shareholder yield is higher than its industry median ratio of (16.75%). Value investors may look for an attractive shareholder yield because it can be a powerful tool for identifying if the company has a good management team.

As one of the most common value metrics, the price-to-book ratio evaluates a company’s current market price relative to its book value. Achilles Therapeutics plc’s price-to-book ratio is lower than its industry median ratio of 2.12. This could make Achilles Therapeutics plc more attractive to investors looking for a new addition to their portfolio.

Creative Medical Technology Holdings, Inc.’s Value Grade

Value Grade:

Creative Medical Technology Holdings, Inc., a commercial stage biotechnology company, focuses on novel biological therapeutics in the fields of immunotherapy, endocrinology, urology, neurology, and orthopedics in the United States. The company offers CaverStem to treat erectile dysfunction; FemCelz for the treatment of loss of genital sensitivity and dryness; and StemSpine, a regenerative stem cell procedure to treat degenerative disc disease. It also develops ImmCelz, an immunotherapy platform for multiple diseases; OvaStem for treatment of female infertility; CELZ-201 to treat Type 1 diabetes; AlloStemSpine for the treatment of chronic lower back pain; and Alova to treat infertility as a result of premature ovarian failure. In addition, the company develops products and services for various indications, including preventing the rejection of transplanted organs, kidney failure, liver failure, heart attack, and Parkinson’s disease. Creative Medical Technology Holdings, Inc. is based in Phoenix, Arizona.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Creative Medical Technology Holdings, Inc. has a Value Score of 95, which is considered to be undervalued.

Creative Medical Technology Holdings, Inc.’s price-to-book ratio is higher than its peers. This could make Creative Medical Technology Holdings, Inc. less attractive for value investors when compared to the industry median at 2.12.

You can read more about Creative Medical Technology Holdings, Inc.’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Moleculin Biotech, Inc.’s Value Grade

Value Grade:

Moleculin Biotech, Inc., a clinical stage pharmaceutical company, focuses on the development of drug candidates for the treatment of cancers and viruses. Its lead drug candidate is Annamycin, which is in Phase 1B/2 clinical trials for the treatment of relapsed or refractory acute myeloid leukemia (AML) and soft tissue sarcoma metastasized to the lungs. The company is also developing WP1066, an immune/transcription modulator designed to inhibit phosphorylated signal transducer and activator of transcription and other oncogenic transcription factors targeting brain tumors, and pancreatic and other cancers. In addition, it develops WP1220, an analog of WP1066 for the topical treatment of cutaneous T-cell lymphoma; and WP1122 to treat viruses, as well as cancer indications, including brain tumors, and pancreatic and other cancers. The company was incorporated in 2015 and is headquartered in Houston, Texas.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Moleculin Biotech, Inc. has a Value Score of 81, which is considered to be undervalued.

Moleculin Biotech, Inc.’s price-to-book ratio is higher than its peers. This could make Moleculin Biotech, Inc. less attractive for value investors when compared to the industry median at 2.12.

You can read more about Moleculin Biotech, Inc.’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Pieris Pharmaceuticals, Inc.’s Value Grade

Value Grade:

Pieris Pharmaceuticals, Inc., a biotechnology company, discovers and develops biotechnological applications. The company focuses on the development of its 4-1BB bispecifics immuno-oncology (IO) programs. Its clinical pipeline consists of IO bispecifics, including S095012 (PRS-344), a bispecific Mabcalin compound targeting PD-L1 and 4-1BB in partnership with Les Laboratoires Servier and Institut de Recherches Internationales Servier; SGN-BB228 (PRS-346), a CD228 x 4-1BB bispecific antibody-Anticalin compound targeting CD228 and 4-1BB in partnership with Pfizer Inc.; and BOS-342 (PRS-342), a GPC3 x 4-1BB bispecific Mabcalin compound targeting GPC3 and 4-1BB in partnership with Boston Pharmaceuticals, which are in phase 1 studies. The company was founded in 2001 and is headquartered in Boston, Massachusetts.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Pieris Pharmaceuticals, Inc. has a Value Score of 72, which is considered to be undervalued.

Pieris Pharmaceuticals, Inc.’s price-to-book ratio is higher than its peers. This could make Pieris Pharmaceuticals, Inc. less attractive for value investors when compared to the industry median at 2.12.

You can read more about Pieris Pharmaceuticals, Inc.’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Silo Pharma, Inc.’s Value Grade

Value Grade:

Silo Pharma Inc. operates as a developmental stage biopharmaceutical company. The company is developing therapeutics that address underserved conditions, including stress-induced psychiatric disorders, chronic pain conditions, and central nervous system (CNS) diseases. It focuses on developing traditional therapies and psychedelic treatments in formulations and drug delivery systems. The company’s lead program, SPC-15, is an intranasal treatment targeting PTSD and stress-induced anxiety disorders. It is also developing SP-26, a time-release ketamine-loaded implant for fibromyalgia and chronic pain relief. In addition, the company’s two preclinical programs comprise SPC-14, an intranasal compound for the treatment of Alzheimer’s disease, and SPU-16, a CNS-homing peptide targeting multiple sclerosis (MS). The company’s research and development programs are conducted through collaborations with Columbia University and the University of Maryland, Baltimore. The company was formerly known as Uppercut Brands, Inc. and changed its name to Silo Pharma, Inc. in September 2020. Silo Pharma, Inc. was incorporated in 2010 and is based in Sarasota, Florida.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Silo Pharma, Inc. has a Value Score of 98, which is considered to be undervalued.

Silo Pharma, Inc.’s price-to-book ratio is higher than its peers. This could make Silo Pharma, Inc. less attractive for value investors when compared to the industry median at 2.12.

You can read more about Silo Pharma, Inc.’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Synaptogenix, Inc.’s Value Grade

Value Grade:

Synaptogenix, Inc. operates as a clinical-stage biopharmaceutical company. It is conducting clinical and preclinical studies of its lead therapeutic candidate, Bryostatin-1, in Alzheimer's disease. Its preclinical studies have also demonstrated bryostatin's regenerative mechanisms of action for the rare disease Fragile X syndrome, and for other neurodegenerative disorders, such as multiple sclerosis, stroke, and traumatic brain injury. The U.S. Food and Drug Administration has granted Orphan Drug Designation to Synaptogenix for Bryostatin-1 as a treatment for Fragile X syndrome. The company was incorporated in 2012 and is headquartered in New York, New York.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Synaptogenix, Inc. has a Value Score of 61, which is considered to be undervalued.

Synaptogenix, Inc.’s price-to-book ratio is higher than its peers. This could make Synaptogenix, Inc. less attractive for value investors when compared to the industry median at 2.12.

You can read more about Synaptogenix, Inc.’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Sensei Biotherapeutics, Inc.’s Value Grade

Value Grade:

Sensei Biotherapeutics, Inc., an immuno-oncology company, engages in the discovery and development of therapeutics for cancer patients. The company’s Tumor Microenvironment Activated Biologics platform is designed to generate highly selective therapeutics that disable immunosuppressive signals or activate immunostimulatory signals selectively in the tumor microenvironment. It also offers SNS-101, an active monoclonal antibody that is in clinical Phase 1/2 targeting the immune checkpoint VISTA for the treatment of solid tumors. The company’s pipeline includes SNS-103 and SNS-102, an active monoclonal antibody, which are in early development stages for the treatment of solid tumors, as well as SNS-201 is a bispecific antibody targeting CD28. It has a collaboration with The University of Washington to conduct preclinical studies for its SNS-101 program. The company was formerly known as Panacea Pharmaceuticals, Inc. Sensei Biotherapeutics, Inc. was incorporated in 1999 and is headquartered in Rockville, Maryland.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Sensei Biotherapeutics, Inc. has a Value Score of 100, which is considered to be undervalued.

Sensei Biotherapeutics, Inc.’s price-to-book ratio is higher than its peers. This could make Sensei Biotherapeutics, Inc. less attractive for value investors when compared to the industry median at 2.12.

You can read more about Sensei Biotherapeutics, Inc.’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Other Biotechnology Stock Grades

Value is just one of the five Stock Grades included in our A+ Investor service. AAII members can see the top-graded stocks—those with grades of A or B for value, growth, momentum, earnings estimate revisions and quality—on the A+ Stock Grades Screener.

Also, if you want full access to all of AAII’s premium services, you can subscribe to one convenient bundled plan called AAII Platinum where you can try out A+ Investor, AAII Dividend Investing, the Stock Superstars Report, Growth Investing and VMQ Stocks. With the other premium services, you can dive deep into additional metrics, portfolios, commentary and information about Biotechnology stocks as well as other industrys.

Choosing Which of the 7 Best Biotechnology Stocks Is Right for You

Choosing which value stocks to invest in will ultimately depend on your individual goals and allocation; however, comparing similar value stocks in the same industry can help you analyze which might be better investments for you in the long run. So, let’s take a look at the Value Grade for all of our stocks.

• Achilles Therapeutics plc stock has a Value Grade of A.
• Creative Medical Technology Holdings, Inc. stock has a Value Grade of A.
• Moleculin Biotech, Inc. stock has a Value Grade of A.
• Pieris Pharmaceuticals, Inc. stock has a Value Grade of B.
• Silo Pharma, Inc. stock has a Value Grade of A.
• Synaptogenix, Inc. stock has a Value Grade of B.
• Sensei Biotherapeutics, Inc. stock has a Value Grade of A.

Now that you have a bit more background about each of the 7 undervalued stocks in the Biotechnology industry as well as their overall grades, it’s time for you to conduct additional research to see if these could fit your portfolio needs based on your goals and risk tolerance. AAII can help you figure out both and identify which investments align with what works best for you.

We do so through a program of education that teaches you to invest for yourself and become an effective manager of your own wealth—no more relying on others for your financial independence. You can rely on AAII for timeless articles on financial planning and stock-picking, unbiased research and actionable analysis that makes you a better investor.

A+ Investor adds to that qualitative teaching by giving you a powerful data suite that helps you whittle down investment decisions to find stocks, exchange-traded funds (ETFs) or mutual funds that meet your needs.

Additional Resources About Biotechnology Stocks

Want to learn more about Biotechnology stocks to see if they could be the right investment for you? Check out some additional resources and articles to help you on your financial journey.

• 4 Undervalued Biotechnology Stocks for Tuesday, October 22
• 7 Undervalued Biotechnology Stocks for Monday, October 21
• 3 Undervalued Biotechnology Stocks for Friday, October 18
• 3 Undervalued Biotechnology Stocks for Thursday, October 17

AAII Disclaimer

We make no representations or warranties that any investor will, or is likely to, achieve profits similar to those shown, because past, hypothetical or simulated performance is not necessarily indicative of future results. Before making an investment decision, you should consider your circumstances and whether the information on our content is applicable to your situation. This information was prepared in good faith and we accept no liability for any errors or omissions. The full disclaimer can be read here.