Healthcare Business

Solid Biotech Stocks With the Best Revenue Growth for 2014

Regeneron Pharmaceuticals
> 2014 Sales Growth: 27%
> Market Cap: $27.5 billion

Regeneron Pharmaceuticals Inc. (NASDAQ: REGN) is one of the high-flyer biotech stocks with a super-high price, and shares have nearly doubled from trough to peak in 2013. Its market value is $27.5 billion, and we would remind readers that this stock was under $60 less than two years ago, so a lot of growth has been factored in. Sales growth is expected to be almost 50% in 2013, but that is expected to be another 27% sales growth to $2.6 billion in 2014. Earnings growth is expected to be almost 57% to $5.99 in earnings per share in 2014. All in all, Regeneron trades at 47 times expected 2014 earnings and just over 10 times expected 2014 sales. Drivers here are additional indications for its Eylea drug and advancing its clinical pipeline in collaboration with Sanofi.

Alexion Pharmaceuticals
> 2014 Sales Growth: 27%
> Market Cap: $23 billion

Alexion Pharmaceuticals Inc. (NASDAQ: ALXN) is just behind Regeneron in market value at this time. Its market cap is more than $23 billion, and at $119 its shares are up almost 50% from trough to peak in the past year. After an expected 36% sales growth in 2013, sales are predicted to rise almost 27% more to $1.95 billion in 2014. After an expected earnings growth of more than 40% in 2013, earnings should be up another 12% in 2014. For forward valuations, this translates to more than 35 times expected 2014 earnings and more than 12 times expected revenue. Alexion’s main driver is robust Soliris sales growth with an expanding global commercial presence. S&P Capital IQ recently forecast gross margins of around 90% for 2013 and 2014.

Incyte
> 2014 Sales Growth: 43%
> Market Cap: $7.5 billion

Incyte Corp. (NASDAQ: INCY) has been in major rally mode in 2013, with shares rising almost 200%. The company’s market cap is $7.5 billion, and its price near $47 was within $2 of a decade high. Incyte is expected to have 19% revenue growth in 2013, but that growth is expected to rise up by 43% to $508 million in 2014. A big bump here is that Incyte is supposed to make its turn to profitability in 2014 as well, following years of losses. Incyte recently raised $750 million in convertible debt, and the main driver here is its approved Jakafi as a treatment for myelofibrosis. Other potential drivers are positive mid-stage studies for drugs in pancreatic cancer, psoriasis and rheumatoid arthritis.

Medivation
> 2014 Sales Growth: 71%
> Market Cap: $4.6 billion

Medivation Inc. (NASDAQ: MDVN) has seen its shares rise about 50% from its low of the past year, and its market cap has grown to $4.6 billion. With shares around $61, its stock is down close to 10% from its all-time high put in very recently, and analysts see another $10 of upside on average. After sales growth of 36% expected in 2013, Medivation sales growth is projected to be 71% to $425 million in 2014. Medivation is supposed to start having its first real profits in 2014 at $1.00 per share. The driver here is its part of XTANDI sales as a treatment for metastatic castration-resistant prostate cancer with Astellas Pharma.

NPS Pharmaceuticals
> 2014 Sales Growth: 71%
> Market Cap: $2.4 billion

NPS Pharmaceuticals Inc. (NASDAQ: NPSP) has been a bit of a controversial stock, with big gains followed by big pain. At $23.35, it has a 52-week range of $7.35 to $35.72, and its market cap is $2.4 billion. This stock has pulled back from close to a decade high, and the consensus price target is up at $37.00. Sales growth of a mere 11% in 2013 is supposed to turn into sales growth of 71% to almost $250 million in 2014. NPS currently is in the transition to a profitable operator, and 2014 is expected to be its first year of operating profits, at $0.53 in earnings per share. NPS’s current driver is Gattex as the first long-term treatment approved for adults with short bowel syndrome. Additional boosts are from its Sensipar royalty stream and late-stage trials turning into sales soon.

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