Based on key financial metrics such as the price-to-sales ratio, shareholder yield and the price-earnings ratio, the following 6 stocks made the list for top value stocks in the Biotechnology & Medical Research 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.

Latest Biotechnology & Medical Research Stock News

Before choosing which top Biotechnology & Medical Research stock to buy, be sure to conduct proper due diligence: analyze various financial metrics and look at historical data, public statements and news coverage.

The Biotechnology and Medical Research sub-industry has a positive outlook, a historically defensive sub-industry. Drug sales are anticipated to have high growth, primarily driven by COVID-19 therapeutics, the continued adoption of many new and innovative therapies, a favorable M&A environment, and a low prevalence of patent expirations in 2022. Additionally, companies could see prescription growth pick up as in-person physician visits return to pre-pandemic levels. As COVID-19 variants have emerged, vaccine boosters have been offered in order to increase efficacy. Due to this, repeat vaccinations will likely be necessary for lifelong immunity which would provide a long-lasting and significant source of revenue for lead vaccine developers. Aside from vaccines, the biotech industry is dependent on the volume of new therapy approvals. The FDA’s heavy focus on COVID-19 could slow the approvals on non-COVID-19 therapies. Despite this, the biotech industry will likely see promising sales growth over the next five years as it usually takes at least five years for new drugs to reach peak sales levels. Approval activity has also been on the rise recently. Mergers and acquisitions activity is expected to remain low as a more activist Federal Trade Commission (led by Lina Khan) could be more skeptical of proposed mergers. Year to date through June 30, the S&P 1500 Biotech Index was down 1.6%, vs. a 20.5% decline for the S&P 1500 Composite Index. In 2021, the Biotech Index rose 8.2%, vs. a 26.7% gain for the Composite Index.

Why Focus on Undervalued Biotechnology & Medical Research 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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6 Undervalued Biotechnology & Medical Research Stocks

Of course, there are countless value stocks that are worth mentioning, but this is a concise list of the top 6 undervalued stocks in the Biotechnology & Medical Research industry for Thursday, February 09, 2023. Let’s take a closer look at their individual scores to see how they measure up against each other and the Biotechnology & Medical Research 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.

Arca Biopharma Inc’s Value Grade

Value Grade:

ARCA biopharma, Inc. (ARCA) is a biopharmaceutical company, which is focused on development and commercialization of targeted therapies for cardiovascular diseases. The Company's lead product includes Recombinant Nematode Anticoagulant Protein c2, or rNAPc2 (AB201) and Gencaro (bucindolol hydrochloride). rNAPc2 (AB201) is a treatment for diseases caused by ribonucleic acid (RNA), viruses, focusing on COVID-19, the disease syndrome caused by the SARS-CoV-2 virus. The gencaro is a pharmacogenetically-targeted beta-adrenergic receptor antagonist with mild vasodilator properties for the treatment of atrial fibrillation (AF) in patients with heart failure. The Company is conducting Phase II b clinical trial of rNAPc2 (AB201). Its ASPEN-COVID-19 Phase IIb is a randomized, multi-center, international clinical trial evaluating two dose regimens of rNAPc2 versus heparin prescribed per local standard of care in hospitalized SARS-CoV-2 positive patients that also have an elevated D-dimer level.

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.

Arca Biopharma Inc has a Value Score of 94, which is considered to be undervalued.

Now, let’s assess Arca Biopharma Inc’s EV/EBITDA ratio, also known as enterprise multiple. At 1.0, 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. Arca Biopharma Inc’s shareholder yield is higher than its industry median ratio of (5.00%). 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. Arca Biopharma Inc’s price-to-book ratio is lower than its industry median ratio of 1.76. This could make Arca Biopharma Inc more attractive to investors looking for a new addition to their portfolio.

Genfit SA (ADR)’s Value Grade

Value Grade:

Genfit SA is a France-based biopharmaceutical company that specializes in the development of medicines for the prevention and treatment of diabetes and related disorders. The Company is focused on contributing to bringing medicines to market for patients with metabolic, inflammatory, autoimmune and fibrotic diseases that affect the liver, such as Nonalcoholic steatohepatitis (NASH) or the bowel, such as the inflammatory bowel disease. The Company targets a number of therapeutic areas, which includes nonalcoholic steatohepatitis (NASH), primary biliary cholangitis (PBC), NASH diagnosis, NASH-induced fibrosis and IL-17 dependent autoimmune diseases. The Company’s research programs develop diversified pipeline of drug candidates, including Elafibranor in NASH, which is in phase III; Elafibranor in PBC, which is in phase II; In-Vitro diagnostic test for NASH and Nitazoxanide in fibrosis, which is still in clinical stage, among others.

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.

Genfit SA (ADR) has a Value Score of 92, which is considered to be undervalued.

Genfit SA (ADR)’s price-earnings ratio is 6.6 compared to the industry median at 12.6. This means that it has a lower price relative to its earnings compared to its peers. This makes Genfit SA (ADR) more attractive for value investors.

Genfit SA (ADR)’s price-to-book ratio is higher than its peers. This could make Genfit SA (ADR) less attractive for value investors when compared to the industry median at 1.76.

You can read more about Genfit SA (ADR)’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.

Hepion Pharmaceuticals Inc’s Value Grade

Value Grade:

Hepion Pharmaceuticals, Inc. is a biopharmaceutical company. The Company is focused on the development of drug therapy for treatment of chronic liver diseases. This therapeutic approach targets fibrosis, inflammation, and the treatment hepatocellular carcinoma (HCC) associated with non-alcoholic steatohepatitis (NASH), viral hepatitis and other liver diseases. The Company's cyclophilin inhibitor, Rencofilstat (formerly CRV431), is developed to offer benefits to address multiple complex pathologies relate to advanced liver disease. Rencofilstat is a pan cyclophilininhibitor that targets multiple pathologic pathways involved in the progression of liver disease. It provides an artificial intelligence (AI) tool, AI-POWR, that allows the selection of novel drug targets, biomarkers, and appropriate patient populations. The components of AI-POWR include access to publicly available databases, and in-house genomic and multi-omic big.

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.

Hepion Pharmaceuticals Inc has a Value Score of 90, which is considered to be undervalued.

Hepion Pharmaceuticals Inc’s price-to-book ratio is higher than its peers. This could make Hepion Pharmaceuticals Inc less attractive for value investors when compared to the industry median at 1.76.

You can read more about Hepion 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.

Disc Medicine Inc’s Value Grade

Value Grade:

Disc Medicine, Inc. is a clinical-stage biopharmaceutical company. The Company is primarily engaged in discovering, developing, and commercializing treatments for patients who suffer from serious hematologic diseases. It is building a portfolio of therapeutic candidates that focuses to address a spectrum of hematologic diseases by targeting fundamental biological pathways of red blood cell biology, specifically heme biosynthesis and iron homeostasis. The Company?s pipeline includes Bitopertin, DISC-0974 and matriptase-2 (TMPRSS6). Bitopertin is a selective inhibitor of glycine transporter 1 (GlyT1). DISC-0974 is an injectable mAb that inhibits signaling through hemojuvelin (HJV), a co-receptor required for hepcidin expression. Its preclinical program to develop an orally administered inhibitor of matriptase-2 (TMPRSS6) is designed to increase the endogenous expression of hepcidin.

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.

Disc Medicine Inc has a Value Score of 88, which is considered to be undervalued.

Disc Medicine Inc’s price-to-book ratio is higher than its peers. This could make Disc Medicine Inc less attractive for value investors when compared to the industry median at 1.76.

You can read more about Disc Medicine 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.

iTeos Therapeutics Inc’s Value Grade

Value Grade:

iTeos Therapeutics Inc. is a clinical-stage biopharmaceutical company. The Company is focused on the discovery and development of differentiated immuno-oncology therapeutics for patients with cancer. The Company's pipeline includes two clinical-stage programs: EOS-448 and Inupadenant. The Company’s lead antibody product candidate, EOS-448, is an antagonist of T-cell immunoreceptor with Ig and ITIM domains (TIGIT), an immune checkpoint with multiple mechanisms of action, which leads to immunosuppression. Its inupadenant, is an adenosine A2A receptor antagonist tailored to overcome the specific adenosine-mediated immunosuppression found in tumor microenvironment. The Company is conducting an open-label multi-arm Phase I/IIa clinical trial of inupadenant in adult cancer patients with advanced solid tumors.

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.

iTeos Therapeutics Inc has a Value Score of 79, which is considered to be undervalued.

iTeos Therapeutics Inc’s price-earnings ratio is 2.9 compared to the industry median at 12.6. This means that it has a lower price relative to its earnings compared to its peers. This makes iTeos Therapeutics Inc more attractive for value investors.

iTeos Therapeutics Inc’s price-to-book ratio is higher than its peers. This could make iTeos Therapeutics Inc less attractive for value investors when compared to the industry median at 1.76.

You can read more about iTeos Therapeutics 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.

Neximmune Inc’s Value Grade

Value Grade:

NexImmune, Inc. is a clinical-stage biotechnology company. The Company is engaged in developing an approach to immunotherapy designed to employ the body’s own T cells to generate an immune response that mimics natural biology. Its product candidates include NEXI-001 in acute myeloid leukemia (AML) and NEXI-002 in multiple myeloma (MM). The Company provides Artificial Immune Modulation (AIM), which is a nanoparticle technology platform. Its AIM technology enables it to construct nanoparticles that function as synthetic dendritic cells capable of directing a specific T cell-mediated immune response. The AIM nanoparticles employ signaling proteins to deliver instructions to T cells directing a desired immune response. Its T cell product candidates are designed to combine the attributes of cellular with reduced potential for toxicities. It is also developing new AIM nanoparticle constructs and modalities for clinical evaluation in oncology and in disease areas outside of oncology.

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.

Neximmune Inc has a Value Score of 88, which is considered to be undervalued.

Neximmune Inc’s price-to-book ratio is higher than its peers. This could make Neximmune Inc less attractive for value investors when compared to the industry median at 1.76.

You can read more about Neximmune 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 & Medical Research 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 & Medical Research stocks as well as other industrys.

Choosing Which of the 6 Best Biotechnology & Medical Research 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.

• Arca Biopharma Inc stock has a Value Grade of A.
• Genfit SA (ADR) stock has a Value Grade of A.
• Hepion Pharmaceuticals Inc stock has a Value Grade of A.
• Disc Medicine Inc stock has a Value Grade of A.
• iTeos Therapeutics Inc stock has a Value Grade of B.
• Neximmune Inc stock has a Value Grade of A.

Now that you have a bit more background about each of the 6 undervalued stocks in the Biotechnology & Medical Research 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 & Medical Research Stocks

Want to learn more about Biotechnology & Medical Research 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.

• 6 Undervalued Biotechnology & Medical Research Stocks for Thursday, February 09
• 5 Undervalued Biotechnology & Medical Research Stocks for Wednesday, February 08
• Why Enanta Pharmaceuticals Inc’s (ENTA) Stock Is Up 12.05%
• 5 Undervalued Biotechnology & Medical Research Stocks for Tuesday, February 07

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