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 Tuesday, September 12, 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.

InMed Pharmaceuticals Inc’s Value Grade

Value Grade:

InMed Pharmaceuticals Inc. is a clinical-stage pharmaceutical company that is engaged in the development, manufacturing and commercialization of rare cannabinoids. It is developing a pipeline of prescription-based products, including rare cannabinoids and novel cannabinoid analogs, targeting the treatment of diseases with unmet medical needs (Product Candidates). The Company’s segments include InMed Pharmaceuticals and BayMedica. The InMed Pharmaceuticals segment is engaged in research and development of cannabinoid-based pharmaceuticals products. The BayMedica segment is focused on developing manufacturing technologies to produce rare cannabinoids for sale in the health and wellness industry. Its two product candidates include INM-755 and INM-088. INM-755 is developed as a topical skin cream formulation containing cannabinol (CBN) for the treatment of symptoms related to Epidermolysis Bullosa (EB). INM-088 provides both neuroprotection and reduces intraocular pressure in the eye.

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.

InMed Pharmaceuticals Inc has a Value Score of 70, which is considered to be undervalued.

When you look at InMed Pharmaceuticals Inc’s price-to-sales ratio at 1.38 compared to the industry median at 7.98, this company has a lower price relative to revenue compared to its peers. This could make InMed Pharmaceuticals Inc’s stock more attractive for value investors.

Now, let’s assess InMed Pharmaceuticals Inc’s EV/EBITDA ratio, also known as enterprise multiple. At 0.6, when compared to the industry median of 0.8, 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. InMed Pharmaceuticals Inc’s shareholder yield is lower than its industry median ratio of (7.63%). 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. InMed Pharmaceuticals Inc’s price-to-book ratio is lower than its industry median ratio of 1.55. This could make InMed Pharmaceuticals Inc more attractive to investors looking for a new addition to their portfolio.

Janone Inc’s Value Grade

Value Grade:

JanOne Inc. is a clinical-stage pharmaceutical company. The Company is focused on identifying, acquiring, licensing, developing, partnering, and commercializing non-opioid and non-addictive therapies to address the large unmet medical need for the treatment of pain and addiction. Its drug candidate, JAN101, is an oral pharmaceutical composition of sodium nitrite that targets poor blood flow to the extremities, such as those with vascular complications of diabetes or Peripheral Artery Disease (PAD) and treats pain. It operates in two segments: Biotechnology and Technology. Its biotechnology segment is focused on finding treatments for conditions that cause severe pain and to market drugs with non-addictive pain-relieving properties. Its recycling segment is an appliance recycling program, which offers recycling, replacement and additional services for utility energy efficiency programs and have established 20 Regional Processing Centers (RPCs) throughout the United States and Canada.

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.

Janone Inc has a Value Score of 93, which is considered to be undervalued.

Janone Inc’s price-earnings ratio is 1.9 compared to the industry median at 20.3. This means that it has a lower price relative to its earnings compared to its peers. This makes Janone Inc more attractive for value investors.

Janone Inc’s price-to-book ratio is higher than its peers. This could make Janone Inc less attractive for value investors when compared to the industry median at 1.55.

You can read more about Janone 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.

LAVA Therapeutics NV’s Value Grade

Value Grade:

LAVA Therapeutics NV, formerly known as Lava Therapeutics BV, is a provider of biotechnology research and development services based in the Netherlands. The Company focuses of developing next generation Vdelta T cell engaging bispecific antibodies to fight 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.

LAVA Therapeutics NV has a Value Score of 74, which is considered to be undervalued.

LAVA Therapeutics NV’s price-to-book ratio is higher than its peers. This could make LAVA Therapeutics NV less attractive for value investors when compared to the industry median at 1.55.

You can read more about LAVA Therapeutics NV’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.

Palisade Bio Inc’s Value Grade

Value Grade:

Palisade Bio, Inc. is a biopharmaceutical company focused on developing therapeutics that protect the integrity of the intestinal barrier. The Company?s approach is founded on the discovery that damage to the intestinal epithelial barrier can result in the leakage of digestive enzymes from the gastrointestinal (GI) tract into the peritoneal cavity, which can damage tissues and promote inflammation, causing a broad array of acute and chronic conditions. Its lead therapeutic candidate, LB1148, is an oral liquid formulation of the well-characterized digestive enzyme inhibitor tranexamic acid (TXA), which is being developed for administration prior to surgeries that are at risk of disrupting the intestinal epithelial barrier. LB1148 is formulated as an aqueous solution for oral (enteral) administration. In addition to TXA, the LB1148 formulation contains polyethylene glycol, carbohydrates, and electrolytes.

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.

Palisade Bio Inc has a Value Score of 77, which is considered to be undervalued.

Palisade Bio Inc’s price-to-book ratio is higher than its peers. This could make Palisade Bio Inc less attractive for value investors when compared to the industry median at 1.55.

You can read more about Palisade 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.

Surrozen Inc’s Value Grade

Value Grade:

Surrozen, Inc. is a clinical-stage biotechnology company. The Company is engaged in discovering and developing drug candidates to selectively modulate the Wnt pathway, a critical mediator of tissue repair, in a range of organs and tissues. The Company's lead product candidates are multi-specific, antibody-based therapeutics that mimic the roles of naturally occurring Wnt or R-spondin proteins, which are involved in activation and enhancement of the Wnt pathway. Its two technologies, Surrozen Wnt signal Activating Protein (SWAP) and Surrozen Wnt signal Enhancers Engineered for Tissue Specificity (SWEETS), enable it to potently and selectively modulate Wnt signaling through the generation of Wnt and R-spondin mimetics. SWAP molecules are designed to mimic the activity of naturally occurring Wnt proteins. SWEETS molecules are designed to amplify the body?s response to naturally occurring Wnt proteins. Its product candidates include SZN-1326, SZN-043 and SZN-413.

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.

Surrozen Inc has a Value Score of 99, which is considered to be undervalued.

Surrozen Inc’s price-to-book ratio is higher than its peers. This could make Surrozen Inc less attractive for value investors when compared to the industry median at 1.55.

You can read more about Surrozen 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.

Xenetic Biosciences Inc’s Value Grade

Value Grade:

Xenetic Biosciences, Inc. is a biopharmaceutical company. The Company is focused on advancing its immune-oncology technologies addressing hard to treat cancers. The Company's DNase platform is designed to improve outcomes of existing treatments, including immunotherapies, by targeting neutrophil extracellular traps (NETs), which are weblike structures composed of extracellular chromatin coated with histones and other proteins. The Company is also developing its personalized Chimeric Antigen Receptor (CAR) T platform technology, XCART, to develop cell-based therapeutics targeting the B-cell receptor on the surface of an individual patient?s malignant tumor cells, for the treatment of B-cell lymphomas. It is also focused on developing its proprietary drug delivery platform, PolyXen, which uses the biological polymer polysialic acid (PSA) to prolong the drug's half-life and potentially improve the stability of therapeutic peptides and proteins.

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.

Xenetic Biosciences Inc has a Value Score of 62, which is considered to be undervalued.

Xenetic Biosciences Inc’s price-to-book ratio is higher than its peers. This could make Xenetic Biosciences Inc less attractive for value investors when compared to the industry median at 1.55.

You can read more about Xenetic 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.

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.

• InMed Pharmaceuticals Inc stock has a Value Grade of B.
• Janone Inc stock has a Value Grade of A.
• LAVA Therapeutics NV stock has a Value Grade of B.
• Palisade Bio Inc stock has a Value Grade of B.
• Surrozen Inc stock has a Value Grade of A.
• Xenetic Biosciences Inc stock has a Value Grade of B.

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 Tuesday, September 12
• 3 Undervalued Biotechnology & Medical Research Stocks for Monday, September 11
• Why Ambrx Biopharma Inc - ADR’s (AMAM) Stock Is Down 4.67%
• Why Amicus Therapeutics, Inc.’s (FOLD) Stock Is Up 5.73%

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