In this article, we will look at the 10 Best Vaccine Stocks to Buy According to Hedge Funds.
What Will Trump’s Tariffs Mean for the Pharma Industry?
On February 24, CNBC reported that President Trump declared that sweeping US tariffs on imports from Mexico and Canada “will go forward” in a statement before the expiry of their month-long delay on their implementation. When asked about the postponed tariffs at a White House press conference, President Trump said:
“The tariffs are going forward on time, on schedule.”
He claimed that foreign nations have been taking advantage of the US in “just about everything,” reiterating his plans to impose “reciprocal tariffs.”
“So the tariffs will go forward, yes, and we’re going to make up a lot of territory,” Trump said.
On February 21, Jared Holz, Mizuho Securities America’s healthcare sector strategist, appeared on CNBC to talk about these tariffs and the ways they could affect the US pharmaceutical sector. Although he was unclear about the exact intention behind these tariffs, he said that he did not consider the pharmaceutical industry to be all that special with respect to other verticals, including technology and industrials, such that President Trump would intend to enlarge its presence in the US.
To him, the tariffs are not just about the generics or branded but are rather more about how the biotech or pharmaceutical industry fits into the grander plans around scaling up domestic manufacturing. Most biotech and pharma companies have a significant presence in the US. However, questions of whether they will hire more people in the US compared to Europe or Asia and whether they will bring back more business to America still stand without answers.
READ ALSO: 10 Best Performing Pharma Stocks So Far in 2025 and 10 Oversold Pharma Stocks to Buy According to Analysts.
Tariffs and On-Shore Capacity in the US
Although Holz was unclear about the answers to such questions, he did say that anything coming out of Europe or China would obviously be fair game. The pharmaceutical companies would say that the Inflation Reduction Act (IRA) as part of the Biden administration is incredibly crippling, and the business that needs to be tied up to make the earnings based on that is very challenging for the sector. Adding Trump’s tariffs to the list would complicate the sector possibly more than others, with the tariffs acting as a “third strike” against the US pharma sector.
Delving deeper into the topic, Holz said that building up manufacturing capacities and facilities from scratch is not as easy as it sounds and requires multiple years to reach a point where companies can produce at a high rate. Therefore, he is unclear about the impact of tariffs on the production capacity and on-shoring of pharma companies.
We recently discussed what Trump’s tariffs could mean for the healthcare industry and looked at another analyst’s perspective on the topic in a recently published article on 12 Most Oversold Healthcare Stocks to Buy Now. Here is an excerpt from the article:
“Since more and more companies in the US are looking towards China for deals regarding the next promising molecule, whether in the obesity or cancer space, the impact of tariffs on this ongoing trend has become a subject of significant discussion in the healthcare industry. On February 7, Carlo Rizzuto, Versant Ventures managing director, appeared on CNBC’s ‘Fast Money’ to discuss the impact of tariffs on healthcare. Rizzuto believed that there are two ways in which tariffs could impact the industry. The first would be products innovated in China and brought over to the US or other markets. To understand how the tariffs would affect such trade processes, the industry would have to see how the tariffs are actually structured in the market.
Secondly and more tangibly, China is a massive center for contract research and manufacturing for the US healthcare industry. Therefore, anything that increases that cost is likely to make the market conditions more challenging. The healthcare industry is already under pressure in terms of investor sentiment, and an increase in cost is not going to help its functioning.”
With these trends in view, let’s look at the 10 best vaccine stocks to buy according to hedge funds.
A scientist holding a vial of the proprietary Ricin Toxin Vaccine ThermoVax in a laboratory.
Our Methodology
We sifted through stock screeners, online rankings, and ETFs to compile a list of 20 vaccine stocks. We then selected the top 10 most popular stocks among elite hedge funds as of Q4 2024. We sourced the hedge fund sentiment data from Insider Monkey’s database. The list is sorted in ascending order of hedge fund sentiment.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
10 Best Vaccine Stocks to Buy According to Hedge Funds
10. BioNTech SE (NASDAQ:BNTX)
Number of Hedge Fund Holders: 35
BioNTech SE (NASDAQ:BNTX) is a German biotechnology company that creates messenger RNA (mRNA) therapeutics and vaccines to address serious diseases such as cancer and infectious diseases. It specializes in developing and manufacturing immunotherapies for patient-specific approaches.
The company reported revenues of €1,244.8 million in fiscal Q3 2024, up from €895.3 million in fiscal Q3 2023. It also grew net profit to €198.1 million from €160.6 million last year, and diluted earnings per share increased to €0.81 ($0.89) from €0.66. This revenue growth was attributed to the approval and successful launch of COVID-19 vaccines for the 2024/2025 season.
BioNTech SE (NASDAQ:BNTX) anticipates full-year 2024 revenues at the lower end of the €2.5-3.1 billion guidance range. It is focusing on advancing its late-stage oncology product candidates and executing them to potential registration. Its strong pipeline and capabilities position the company to execute its vision of becoming a global multiproduct immunotherapy company.
9. GSK plc (NYSE:GSK)
Number of Hedge Fund Holders: 38
Formerly known as GlaxoSmithKline, GSK plc (NYSE:GSK) is a global healthcare and pharmaceutical corporation that develops and distributes a range of vaccines, medications, and consumer health items. It is based in the United Kingdom and has over 20 vaccines in its portfolio, positioning it as a leader in vaccines, immunology, and respiratory therapies. The company also develops cancer treatments for multiple myeloma, ovarian cancer, and endometrial cancer in addition to other drugs.
GSK plc (NYSE:GSK) reported solid financial results for fiscal Q4 2024, reflecting strong growth across key metrics. Its sales grew 8% to over £31 billion in 2024, and core operating profit rose by 13%. Similarly, core earnings per share (EPS) grew by 12%.
This growth was attributed to the company’s Specialty Medicines segment, which rose 19% in sales. Its HIV sales grew by 13% for 2024, and oncology sales nearly doubled to more than £1.4 billion. GSK plc (NYSE:GSK) is continuing to strengthen its pipeline, with 11 positive phase III trials reported in 2024 and five new product approvals anticipated in 2025. These include Blenrep for multiple myeloma and depemokimab for severe asthma.
8. Moderna, Inc. (NASDAQ:MRNA)
Number of Hedge Fund Holders: 44
Moderna, Inc. (NASDAQ:MRNA) is a biotech company that develops vaccines based on messenger RNA (mRNA). While the company is experiencing weak sales and sluggish market adoption of its new products, it has strong fundamentals. Its elaborate pipeline of therapeutics in clinical trials lends it an optimistic outlook.
The company is focusing on maintaining its COVID-19 vaccination market share in 2025 and is advancing its late-stage candidate pipeline. Moderna, Inc. (NASDAQ:MRNA) is also anticipating FDA approval for an expanded indication of its RSV vaccine in the respiratory vaccine domain. It has also submitted a combination influenza-COVID-19 vaccine for approval, backed by positive phase 3 study data.
In addition, analysts are bullish on the company due to Moderna, Inc.’s (NASDAQ:MRNA) non-respiratory portfolio, which includes vaccines for norovirus and cytomegalovirus (CMV). mRNA-4157, under study in collaboration with Merck, also shows potential across various cancerous tumor types. This diverse pipeline reflects the company’s ability to divulge its mRNA technology into new categories, establishing itself as a more mature and diversified commercial-stage biotech company. The company ranks eighth on our list of the 10 best vaccine stocks to buy according to hedge funds.
7. Vaxcyte, Inc. (NASDAQ:PCVX)
Number of Hedge Fund Holders: 50
Vaxcyte, Inc. (NASDAQ:PCVX) is a clinical-stage vaccine innovation company that develops high-fidelity vaccines. It continues to develop broad-spectrum conjugate and novel protein vaccines to prevent or treat bacterial infectious diseases. It re-engineers the creation of highly complex vaccines through advanced chemistry and modern synthetic techniques.
Vaxcyte, Inc. (NASDAQ:PCVX) remains well-positioned to maintain continued positive momentum across its PCV (pneumococcal conjugate vaccine) franchise. Apart from this franchise, its lead clinical candidate is VAX-24, a 24-valent pneumococcal conjugate vaccine (PCV) to prevent invasive pneumococcal disease. The vaccine holds significant potential to become a best-in-class PCV in a $7 billion global market expected to reach nearly $13 billion by 2027. The vaccine has received FDA Breakthrough Therapy designation for preventing invasive pneumococcal disease in adults.
Baron Health Care Fund stated the following regarding Vaxcyte, Inc. (NASDAQ:PCVX) in its Q3 2024 investor letter:
“We purchased Vaxcyte, Inc. (NASDAQ:PCVX), a biopharmaceutical company with a next-generation vaccine platform. Vaxcyte recently showed data suggesting that their pneumococcal vaccine is better than the current vaccines on the market today. Pneumococcal vaccines are one of the largest vaccine categories today, with approximately $8 billion in worldwide sales. The vaccines are recommended for children under 5 or adults over 65 to prevent pneumococcal infection. The incumbents’ technology has hit a ceiling where their vaccines require too much protein carrier, which causes immune interference and lowered response to the pneumococcal antigen. As Pfizer and Merck have tried to add more serotypes to their vaccines, they’ve lost efficacy on some of the historically relevant serotypes. Vaxcyte’s platform allows a lower protein carrier/antigen ratio so the company can include more serotypes while minimizing carrier suppression. Vaxcyte recently reported impressive Phase 1/2 data for their VAX31 vaccine in adults. VAX31 looked at least as good as Pfizer’s standard of care PCV20 vaccine on the existing 20 serotypes (and was statistically superior on several serotypes) and added strong immune coverage of 11 additional serotypes. VAX31 now covers 95% of circulating strains in US adults and 98% in the EU. TheUSy will now run Phase 3 studies in adults and start a Phase 1/2 for VAX31 in children. We think that the pneumococcal vaccine market will be $10 billion-plus in 2030, that VAX31 can capture significant share, and that this will be a durable business.”
6. AstraZeneca PLC (NASDAQ:AZN)
Number of Hedge Fund Holders: 55
AstraZeneca PLC (NASDAQ:AZN) is a biopharmaceutical company that explores, develops, manufactures, and commercializes prescription medicines. It supplies its products and services to specialty and primary care physicians. AstraZeneca PLC (NASDAQ:AZN) distributes its products and services through local representative offices and distributors. The company has grown its revenue by 17.77% over the last 5 years.
AstraZeneca PLC (NASDAQ:AZN) is strengthening its portfolio of FDA-approved drugs. In January, it obtained FDA approval for Dato DXd, a treatment for advanced-stage breast cancer. AstraZeneca PLC (NASDAQ:AZN) estimates that this treatment will generate annual sales of $5 billion. It also plans to release seven high-value drugs in the market in 2025.
The company reported a $1.5 billion increase in net cash flow from operating activities in 2024. It paid off approximately $7 billion in debt and grew its pipeline through strategic acquisitions, such as Fusion, Icosavax, and Amolyt. AstraZeneca PLC (NASDAQ:AZN) expects overall sales to grow at a high single-digital rate in 2025 and core EPS to rise by a low double-digit percentage. The company takes the sixth spot on our list of the 10 best vaccine stocks to buy according to hedge funds.
5. Amgen, Inc. (NASDAQ:AMGN)
Number of Hedge Fund Holders: 72
Amgen Inc. (NASDAQ:AMGN) is a biotechnology company that discovers, develops, manufactures, and markets human therapeutics. It delivers new therapies for patients with complex cancers, especially in areas with significant unmet needs. The company ended fiscal Q4 2024 with 14 medicines, each annualizing at more than $1 billion. Several of these are expected to be key growth drivers for the company through the decade.
Amgen Inc. (NASDAQ:AMGN) also has a strong portfolio for rare diseases, which is expected to expand in 2025 with the potential regulatory approval for TEPEZZA internationally, the first and only FDA-approved medicine to treat Thyroid Eye Disease (TED). Launches in new indications for UPLIZNA, which treats neuromyelitis optica spectrum disorder (NMOSD), are expected to further strengthen the growth trajectory of the company’s rare disease business.
Repatha, which treats cholesterol and heart disease, and EVENITY, which targets osteoporosis in postmenopausal women, are drugs continually delivering strong growth for the company. Repatha has developed into a multi-billion dollar product. Heart disease, the leading cause of death worldwide, is further driving its growth. Analysts are bullish on the stock as its October 2023 acquisition of Horizon Therapeutics is expected to pay off in the next five years. The company ranks fifth on our list of the best vaccine stocks to buy according to hedge funds.
PGIM Jennison Health Sciences Fund stated the following regarding Amgen Inc. (NASDAQ:AMGN) in its Q2 2024 investor letter:
“Amgen Inc. (NASDAQ:AMGN) is a large-cap global biotech company with a diverse portfolio of marketed and pipeline products. Amgen’s discovery pipeline had led the company to broaden its focus from oncology, immunology, and renal disease to include musculoskeletal, cardiovascular, and neurologic conditions. In addition, Amgen has turned its expertise in antibody manufacturing into a leading position in the development of biosimilars of competitor drugs. Most recently, Amgen shares advanced in 2Q following its announcement that its novel injectable GLP-1 agonist / GIPR antagonist, MariTide, for obesity showed promising interim Phase 2 data and has shown enough promise to warrant advancement into pivotal trials as soon as late 2024. While Eli Lilly and Novo Nordisk will remain the market leaders in the diabetes/obesity space, we think there is room for Amgen to carve out a meaningful share of the market with its antibody-peptide conjugate approach that could enable monthly or better dosing for MariTide.”
4. Merck & Co., Inc. (NYSE:MRK)
Number of Hedge Fund Holders: 91
Merck & Co., Inc. (NYSE:MRK) is a biopharmaceutical company that delivers health solutions to advance the treatment and prevention of diseases in animals and people. Its Pharmaceutical segment offers vaccines and human health pharmaceutical products, which typically consist of therapeutic and preventive agents. Its Animal Health segment develops, discovers, manufactures, and markets a range of vaccines and veterinary pharmaceutical products.
Merck & Co., Inc.’s (NYSE:MRK) pipeline lends it a competitive market advantage, with around 20 potential new growth drivers holding blockbuster potential. Its late-stage pipeline in infectious diseases, oncology, and cardiometabolic further bolsters its future outlook. The company’s strong commercial execution, diversified portfolio, and innovative pipeline lend it resilience against short-term headwinds, positioning it as an attractive investment with a solid long-term growth trajectory.
The company recently announced it has received European Commission conditional approval for WELIREG (belzutifan), the first oral HIF-2α inhibitor in the EU, for the treatment of adult patients with von Hippel-Lindau (VHL) disease and advanced clear cell renal cell carcinoma.
Although the company is experiencing some headwinds, such as temporarily stopping the shipments of its HPV vaccine Gardasil to China until mid-2025 due to weak discretionary spending, it has strong operations. These are supported by robust demand for its diverse and innovative portfolio. Its Keytruda drug for cancer treatment is performing well, and the launch of Winrevair, a drug that treats pulmonary arterial hypertension (PAH), is also boosting revenue growth for the company.
GreensKeeper Asset Management, an investment management company, released its Q3 investor letter. Here is what the fund said:
“Merck & Co., Inc. (NYSE:MRK) was our second-largest detractor this quarter, declining -8.3%. MRK’s leading HPV vaccine, GARDASIL 9, faced challenges internationally due to inventory buildup within its Chinese distributor, which is expected to reduce shipments for the remainder of 2024. Despite this short-term impact, the long-term outlook for GARDASIL 9 remains promising. Meanwhile, the company’s $27 billion Keytruda cancer juggernaut continues to grow at a healthy clip, powering earnings growth.”
3. Pfizer Inc. (NYSE:PFE)
Number of Hedge Fund Holders: 92
Pfizer Inc. (NYSE:PFE) is a global biopharmaceutical company that manufactures, develops, markets and sells vaccines and biopharmaceutical products worldwide. It advances wellness, prevention, treatment, and cures in developing and emerging markets. The company’s goal is to become a world-class oncology leader and plans to continue its progress in oncology for the rest of the decade.
Pfizer Inc. (NYSE:PFE) is focused on its oncology pipeline for future growth, with its 2030 goals entailing the addition of several new blockbuster drugs to its portfolio. The company is expected to continue looking for opportunities to acquire promising pharmaceutical companies to augment its pipeline further. It used a significant portion of its pandemic profits on the $43 billion acquisition of Seagen, a biotech company specializing in oncology.
This strategy is working well for Pfizer Inc. (NYSE:PFE) as management estimates earnings growth between 10% and 18% for 2025. Analysts also estimate the company’s earnings to grow by around 14% annually over the next 3-5 years. Furthermore, Pfizer Inc. (NYSE:PFE) has an attractive dividend yield of 6.3%, higher than most blue-chip stocks. Its management has reiterated plans to support and raise this dividend periodically, recently announcing a 2.4% increase in early December. The company ranks third on our list of the 10 best vaccine stocks to buy according to hedge funds.
2. Johnson & Johnson (NYSE:JNJ)
Number of Hedge Fund Holders: 98
Johnson & Johnson (NYSE:JNJ) develops, manufactures, and sells a range of products in the healthcare field through its subsidiaries. With a primary focus on products related to human well-being and health, the company operates through two segments: Innovative Medicine and MedTech. Its Innovative Medicine segment encompasses various therapeutic areas, including infectious diseases, immunology, neuroscience, metabolic and cardiovascular diseases, pulmonary hypertension, and oncology. The MedTech segment includes an elaborate range of medical devices and products used in cardiovascular intervention, orthopedic, interventional solutions, surgery, and vision fields.
On January 13, Johnson & Johnson (NYSE:JNJ) announced the $14.6 billion acquisition of neurological drugmaker IntraCellular. This acquisition will allow the company access to Caplyta, an oral drug for the treatment of bipolar disorder and schizophrenia.
Apart from that, the company has strong fundamentals and a AAA credit rating, which is higher than that of the US government. Johnson & Johnson (NYSE:JNJ) reported sales of $88.8 billion for fiscal year 2024, reflecting a 4.3% year-over-year growth. Its revenue reached $22.5 billion in revenue, marking a 5.2% year-over-year increase. The MedTech segment saw a 6.2% increase in global operational sales, with acquisitions and divestitures contributing 1.5% to the growth. Growth in the Cardiovascular division was attributed to strong demand for electrophysiology products and Abiomed, while the General Surgery segment grew due to increased sales of wound closure products.
Johnson & Johnson (NYSE:JNJ) has various other growth opportunities, such as the robotic-assisted surgery industry. It is developing the Ottava system to compete in the sector, which is expected to drive further growth for the company after its approval.
1. Eli Lilly and Company (NYSE:LLY)
Number of Hedge Fund Holders: 115
Eli Lilly and Company (NYSE:LLY) develops, manufactures, discovers, and sells pharmaceutical products. These products span oncology, diabetes, immunology, neuroscience, and other therapies. Investors are bullish on Eli Lilly and Company (NYSE:LLY) due to its in-demand GLP-1 drugs, used to treat diabetes and obesity, which are still in their early growth stages, and the company’s strong financials.
Eli Lilly and Company (NYSE:LLY) is a major player in the GLP-1 market and is making a significant investment in its experimental oral weight-loss drug, orforglipron, by accumulating nearly $550 million in pre-launch inventory ahead of its expected 2026 release. Since pharmaceutical companies usually build inventory relatively closer to regulatory approval for drugs, accumulating a strong pre-launch inventory reflects the company’s aim to make a strong market entry and gain an early advantage over competitors in the weight-loss treatment sector.
The company has strong fundamentals. It reported a 32% revenue growth in fiscal 2024 compared to fiscal 2023, exceeding its first-time guidance by $4 billion. Eli Lilly and Company (NYSE:LLY) also made substantial progress across its strategic deliverables in fiscal Q4 2024, with revenue growing by 45% in the quarter, supported by strong uptake of its Mounjaro and Zepbound drugs. Its immunology, oncology, and neuroscience segments are also performing well, supporting bullish sentiments for the stock.
Baron Health Care Fund stated the following regarding Eli Lilly and Company (NYSE:LLY) in its Q4 2024 investor letter:
“Eli Lilly and Company (NYSE:LLY) is a global pharmaceutical company best known for developing and selling GLP-1 medications for diabetes and obesity. Shares detracted from performance as recent GLP-1 revenue results missed heightened expectations. We view Lilly’s Mounjaro/Zepbound GLP-1/GIP drug as an important treatment for diabetic and non-diabetic obese patients and see Lilly continuing to innovate and develop more effective and convenient next-generation medications. Although manufacturing supply and access is limited in the near term, we think this class of drug should be the standard of care for both diabetes and obesity and will become a $150 billion category. We think the recent revenue miss related to the mistiming of demand-generation activities with supply increases and elevated investor expectations after a very strong result in the prior quarter. We think this market is in the early innings of uptake and the adoption of GLP-1s will triple Lilly’s total revenues by 2030.”
Overall, LLY ranks first among the best vaccine stocks to buy according to hedge funds. While we acknowledge the potential of vaccine stocks, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than LLY but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock.
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