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 Monday, March 27, 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.

AEterna Zentaris Inc. (USA)’s Value Grade

Value Grade:

Aeterna Zentaris Inc. is a specialty biopharmaceutical company, which is engaged in commercializing and developing therapeutics and diagnostic tests. The Company's lead product, Macrilen (macimorelin), is an oral test indicated for the diagnosis of patients with adult growth hormone deficiency (AGHD). Macrilen (macimorelin) is an orally available peptidomimetic ghrelin receptor agonist that stimulates the secretion of growth hormone by binding to the ghrelin receptor (GHSR-1a) and has uses in both endocrinology and oncology indications. The Company is also leveraging the clinical and compelling safety profile of macimorelin to develop it for the diagnosis of childhood-onset growth hormone deficiency (CGHD). It is also developing oral prophylactic bacterial vaccines against each of SARS-CoV-2, the virus that causes COVID-19, and Chlamydia Trachomatis. The Company focuses on the commercialization of macimorelin in Asia and the rest of the world.

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.

AEterna Zentaris Inc. (USA) has a Value Score of 86, which is considered to be undervalued.

When you look at AEterna Zentaris Inc. (USA)’s price-to-sales ratio at 1.93 compared to the industry median at 8.72, this company has a lower price relative to revenue compared to its peers. This could make AEterna Zentaris Inc. (USA)’s stock more attractive for value investors.

Now, let’s assess AEterna Zentaris Inc. (USA)’s EV/EBITDA ratio, also known as enterprise multiple. At 1.9, when compared to the industry median of 0.9, 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. AEterna Zentaris Inc. (USA)’s shareholder yield is higher than its industry median ratio of (5.68%). 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. AEterna Zentaris Inc. (USA)’s price-to-book ratio is lower than its industry median ratio of 1.40. This could make AEterna Zentaris Inc. (USA) more attractive to investors looking for a new addition to their portfolio.

Dominari Holdings Inc’s Value Grade

Value Grade:

Dominari Holdings Inc., formerly AIkido Pharma Inc., is a biotechnology company. The Company has a diverse portfolio of small-molecule anticancer and antiviral therapeutics in development. The Company?s pipeline consists of patented technology from universities and researchers. The Company advances its therapeutic drug pipeline through a collaboration with educational institutions, including the University of Texas at Austin, the University of Maryland, Baltimore and Wake Forest University. Its oncology therapeutics include treatments for pancreatic cancer, acute myeloid leukemia (AML) and acute lymphoblastic leukemia (ALL). It is also developing a broad-spectrum antiviral platform, in which the lead compounds have activity against multiple viruses including Influenza virus, Ebolavirus and Marburg virus, SARS-CoV, MERS-CoV, and SARS-CoV-2, the cause of COVID-19. Its pancreatic drug candidate, DHA-dFdC, is a chemotherapy treatment for advanced pancreatic cancer.

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.

Dominari Holdings Inc has a Value Score of 94, which is considered to be undervalued.

Dominari Holdings Inc’s price-to-book ratio is higher than its peers. This could make Dominari Holdings Inc less attractive for value investors when compared to the industry median at 1.40.

You can read more about Dominari 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.

Fresh Tracks Therapeutics Inc’s Value Grade

Value Grade:

Fresh Tracks Therapeutics, Inc., formerly Brickell Biotech, Inc., is a clinical-stage pharmaceutical company engaged in transforming patient lives through the development of differentiated prescription therapeutics. Its pipeline is focused on providing existing treatment paradigms and features several new molecular entities that inhibit novel targets with potential for autoimmune, inflammatory, and other debilitating diseases. The Company’s strategy is exploring therapies by identifying, pursuing, and developing therapeutics that can help people struggling with autoimmune, inflammatory and other debilitating diseases. Its pipeline includes FRTX-02, FRTX-10, Kinase Inhibitors and FRTX-03. Its lead program, FRTX-02, is a clinical-stage oral DYRK1A inhibitor for patients with autoimmune diseases to be administered in humans. Its FRTX-10 is a preclinical-stage stimulator of interferon genes (STING) inhibitor candidate. Its Kinase Inhibitors include compounds that inhibit prominent targets.

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.

Fresh Tracks Therapeutics Inc has a Value Score of 85, which is considered to be undervalued.

Fresh Tracks Therapeutics Inc’s price-to-book ratio is higher than its peers. This could make Fresh Tracks Therapeutics Inc less attractive for value investors when compared to the industry median at 1.40.

You can read more about Fresh Tracks 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.

Jounce Therapeutics Inc’s Value Grade

Value Grade:

Jounce Therapeutics, Inc. is a clinical-stage immunotherapy company. The Company is engaged in transforming the treatment of cancer by developing therapies that enable the immune system to attack tumors and provide long-lasting benefits to patients through a biomarker-driven approach. The Company has developed a suite of integrated technologies that consist of its Translational Science Platform, enabling it to interrogate the cellular and molecular composition of tumors. Its program, JTX-8064, is a humanized IgG4, anti-LILRB2 monoclonal antibody designed to reprogram macrophages. JTX-8064 is being developed for patients with either PD-(L)1-inhibitor resistant or PD-(L)1 inhibitor-sensitive tumors. Vopratelimab is a clinical-stage monoclonal antibody that binds to and activates the Inducible T cell CO-Stimulator (ICOS). Pimivalimab is a clinical-stage anti-PD-1 monoclonal antibody that is being developed primarily for its use in combination with its product candidates.

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.

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

Jounce Therapeutics Inc’s price-to-book ratio is higher than its peers. This could make Jounce Therapeutics Inc less attractive for value investors when compared to the industry median at 1.40.

You can read more about Jounce 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.

NovaBay Pharmaceuticals Inc’s Value Grade

Value Grade:

NovaBay Pharmaceuticals, Inc. is a pharmaceutical company that develops and sells consumer products for the eyecare and skincare markets. The Company's lead product, Avenova Antimicrobial Lid and Lash Solution (Avenova Spray), is proven in laboratory testing to have antimicrobial properties as it removes foreign material, such as microorganisms and debris from the skin around the eye, including the eyelid. Avenova Spray is formulated with its form of hypochlorous acid and is cleared by the United States Food and Drug Administration (FDA) for sale in the United States. Its other eyecare products offered under the Avenova eyecare brand include Novawipes by Avenova, Avenova Lubricant Eye Drops, Avenova Moist Heating Eye Compress and the i-Chek. Avenova Spray is available both over-the-counter and as a prescription. Avenova Spray is also available at optometrists and ophthalmologists offices; at national pharmacy chains across all over 50 states, and through its Partner Pharmacy Program.

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.

NovaBay Pharmaceuticals Inc has a Value Score of 79, which is considered to be undervalued.

NovaBay Pharmaceuticals Inc’s price-to-book ratio is higher than its peers. This could make NovaBay Pharmaceuticals Inc less attractive for value investors when compared to the industry median at 1.40.

You can read more about NovaBay 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.

Vincerx Pharma Inc’s Value Grade

Value Grade:

Vincerx Pharma, Inc. is a clinical-stage life sciences company that is focused on the development and oncology knowledge to advance new therapies to address unmet medical needs for the treatment of cancer. The Company’s small molecule drug program includes VIP152, which is a selective, clinical-stage positive transcription elongation factor-beta/cyclin-dependent kinase 9 (PTEFb/CDK9) inhibitor. The Company's antibody-drug conjugate (ADC) platform includes VIP943 and VIP924, which are ADC compounds addressing known and oncology targets. The bioconjugation program also includes VIP236, which is a small molecule drug conjugate (SMDC) for solid tumors. Its SMDC platform targets advanced solid tumors with optimized camptothecin, a potent cytotoxin (warhead, payload or toxophore).

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.

Vincerx Pharma Inc has a Value Score of 82, which is considered to be undervalued.

Vincerx Pharma Inc’s price-to-book ratio is higher than its peers. This could make Vincerx Pharma Inc less attractive for value investors when compared to the industry median at 1.40.

You can read more about Vincerx 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.

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.

• AEterna Zentaris Inc. (USA) stock has a Value Grade of A.
• Dominari Holdings Inc stock has a Value Grade of A.
• Fresh Tracks Therapeutics Inc stock has a Value Grade of A.
• Jounce Therapeutics Inc stock has a Value Grade of A.
• NovaBay Pharmaceuticals Inc stock has a Value Grade of B.
• Vincerx Pharma 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 Monday, March 27
• 3 Undervalued Biotechnology & Medical Research Stocks for Friday, March 24
• Is Obseva SA (OBSVF) Stock a Good Investment?
• Which Is a Better Investment, AbCellera Biologics Inc or United Therapeutics Corporation Stock?

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