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 & 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.

Click the button below to learn more about A+ Investor and subscribe today.

7 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 7 undervalued stocks in the Biotechnology & Medical Research industry for Tuesday, July 18, 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.

Atossa Therapeutics Inc’s Value Grade

Value Grade:

Atossa Therapeutics, Inc. is a clinical-stage biopharmaceutical company developing medicines in areas of unmet medical need in oncology with a focus on breast cancer. The Company?s lead drug candidate under development is oral (Z)-endoxifen, which the Company is developing in two settings: one to treat breast cancer by reducing tumor cell activity prior to surgery and another to reduce breast tissue density in women. Its programs under development include (Z)-endoxifen Programs, AT-H201, and other programs. (Z)-endoxifen is an active metabolite of tamoxifen, to treat and prevent breast cancer in high-risk women. It is developing a form of (Z)-endoxifen, which is administered orally for the potential treatment of breast cancer and reduction of breast density. AT-H201 is for lung injury caused by cancer treatments. AT-H201 consists of a combination of two drugs to treat other diseases. Its other programs include Immunotherapy/CAR-T Programs, which is in early stage of development.

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.

Atossa Therapeutics Inc has a Value Score of 81, which is considered to be undervalued.

Now, let’s assess Atossa Therapeutics Inc’s EV/EBITDA ratio, also known as enterprise multiple. At 0.4, when compared to the industry median of 0.6, the company may be considered undervalued 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. Atossa Therapeutics Inc’s shareholder yield is higher than its industry median ratio of (6.01%). 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. Atossa Therapeutics Inc’s price-to-book ratio is lower than its industry median ratio of 1.75. This could make Atossa Therapeutics Inc more attractive to investors looking for a new addition to their portfolio.

Genetron Holdings Ltd - ADR’s Value Grade

Value Grade:

Genetron Holdings Limited is a precision oncology company that specializes in cancer molecular profiling and harnesses technologies in molecular biology and data science to transform cancer treatment. The Company has developed a comprehensive product and service portfolio that cover the full-cycle of cancer care from early screening, to diagnosis and treatment recommendations, to continuous monitoring and continuous care. The Company operates its businesses primarily within the China market.

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.

Genetron Holdings Ltd - ADR has a Value Score of 64, which is considered to be undervalued.

Genetron Holdings Ltd - ADR’s price-to-book ratio is higher than its peers. This could make Genetron Holdings Ltd - ADR less attractive for value investors when compared to the industry median at 1.75.

You can read more about Genetron Holdings Ltd - 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.

Invitae Corp’s Value Grade

Value Grade:

Invitae Corporation is a medical genetics company. The Company is engaged in delivering genetic testing services, digital health solutions, and health data services that support a lifetime of patient care and improved outcomes. It offers genetic testing across multiple clinical areas, including hereditary cancer, precision oncology, women's health, rare diseases and pharmacogenomics. It applies proprietary design, process automation, robotics and bioinformatics software solutions to expand the use and impact of genetic information in sample processing and complex variant interpretation, allowing medical interpretation at scale. The Company also utilizes digital health solutions to improve ease-of-use and to deliver actionable information about risk, prevention, treatment, and monitoring. The Company has served over 3.6 million patients, and over 2.2 million of those patients have made their information available for data sharing.

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.

Invitae Corp has a Value Score of 73, which is considered to be undervalued.

You can read more about Invitae Corp’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.

Pear Therapeutics Inc’s Value Grade

Value Grade:

Pear Therapeutics, Inc. is a commercial-stage healthcare company. The Company is engaged in developing a new class of software-based medicines that is referred to as prescription digital therapeutics (PDTs), which use software to treat diseases directly. Its products include reSET, reSET-O and Somryst. The Company's reSET product is indicated for the treatment of substance use disorder (SUD) as a monotherapy. Its reSET-O product is developed for the treatment of opioid use disorder (OUD) in combination with buprenorphine. The Company's Somryst product is indicated for the treatment of chronic insomnia. The Company’s pipeline consists of product candidates in psychiatry, neurology, and outside-of-central nervous system therapeutic areas. The Company has built a portfolio of PDT product candidates that is primarily focused on psychiatric conditions.

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.

Pear Therapeutics Inc has a Value Score of 83, which is considered to be undervalued.

Pear Therapeutics Inc’s price-to-book ratio is higher than its peers. This could make Pear Therapeutics Inc less attractive for value investors when compared to the industry median at 1.75.

You can read more about Pear 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.

Petros Pharmaceuticals Inc’s Value Grade

Value Grade:

Petros Pharmaceuticals, Inc. is a pharmaceutical company. The Company is focused on men?s health therapeutics with a full range of commercial capabilities including sales, marketing, regulatory and medical affairs, finance, trade relations, pharmacovigilance, market access relations, manufacturing, and distribution. It commercializes therapeutics for men's health issues, such as endothelial dysfunction, psychosexual and psychosocial ailments, hormone health, and substance-use disorders. It also commercializes and develops Stendra, a PDE-5 inhibitor prescription medication for the treatment of erectile dysfunction (ED). It also markets its own line of ED products in the form of vacuum erection device products through its subsidiaries, Timm Medical and PTV. In addition to ED products, it has a global license (the Hybrid License) to develop and commercialize H100, a novel and patented topical formulation candidate for the treatment of acute Peyronies disease.

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.

Petros Pharmaceuticals Inc has a Value Score of 74, which is considered to be undervalued.

Petros Pharmaceuticals Inc’s price-to-book ratio is higher than its peers. This could make Petros Pharmaceuticals Inc less attractive for value investors when compared to the industry median at 1.75.

You can read more about Petros 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.

Revelation Biosciences Inc’s Value Grade

Value Grade:

Revelation Biosciences, Inc. is a clinical-stage biopharmaceutical company engaged in the development of innate immune system therapeutics and diagnostics. Its therapeutic candidates are based on the active ingredient phosphorylated hexaacyl disaccharide (PHAD), a synthetic version of monophosphoryl lipid A (MPLA) that is known to stimulate Toll-like receptor 4 (TLR-4). Its product candidates include REVTx-300, which is being developed as a potential therapy for the prevention and treatment of acute organ injury and chronic organ disease; REVTx-100, which is being developed for the prevention and treatment of infections, including healthcare-associated bacterial infections resulting from surgery, severe burns, and antibiotic resistance; REVTx-200, which is being developed as a potential intranasal therapy that is administered with a traditional commercially available intramuscular (IM) vaccine, and REVTx-99b, which is being developed as a treatment for food allergies.

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.

Revelation Biosciences Inc has a Value Score of 71, which is considered to be undervalued.

Revelation Biosciences Inc’s price-to-book ratio is higher than its peers. This could make Revelation Biosciences Inc less attractive for value investors when compared to the industry median at 1.75.

You can read more about Revelation Biosciences 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.

Vyant Bio Inc’s Value Grade

Value Grade:

Vyant Bio, Inc. is a biotechnology company focused on drug discovery for complex neurodevelopmental and neurodegenerative disorders. The Company is engaged in combining sophisticated data science capabilities with highly functional human cell derived disease models. Its central nervous system (CNS) drug discovery platform combines human-derived organoid models of brain disease, scaled biology, and machine learning. The Company?s platform is designed to elucidate disease pathophysiology; formulate key therapeutic hypotheses; identify and validate drug targets, cellular assays, and biomarkers to guide candidate molecule selection, and guide clinical trial patient selection and trial design. The Company?s programs are focused on identifying repurposed and novel small molecule clinical candidates for rare CNS genetic disorders, including Rett Syndrome (Rett), CDKL5 Deficiency Disorders (CDD) and familial Parkinson?s Disease (PD).

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.

Vyant Bio Inc has a Value Score of 75, which is considered to be undervalued.

Vyant Bio Inc’s price-to-book ratio is higher than its peers. This could make Vyant Bio Inc less attractive for value investors when compared to the industry median at 1.75.

You can read more about Vyant Bio 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 7 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.

• Atossa Therapeutics Inc stock has a Value Grade of A.
• Genetron Holdings Ltd - ADR stock has a Value Grade of B.
• Invitae Corp stock has a Value Grade of B.
• Pear Therapeutics Inc stock has a Value Grade of A.
• Petros Pharmaceuticals Inc stock has a Value Grade of B.
• Revelation Biosciences Inc stock has a Value Grade of B.
• Vyant Bio Inc stock has a Value Grade of B.

Now that you have a bit more background about each of the 7 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.

• 7 Undervalued Biotechnology & Medical Research Stocks for Tuesday, July 18
• Is Sagimet Biosciences Inc (SGMT) Stock a Good Investment?
• What You Need to Know About Nurix Therapeutics Inc's Q2 Earnings
• 3 Undervalued Biotechnology & Medical Research Stocks for Monday, July 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.