10 Cheap Pharmaceutical Stocks to Buy According to Short Sellers

2. AstraZeneca PLC (NASDAQ:AZN)

Short Interest as % of  Shares Outstanding: 0.18%

Number of Hedge Fund Investors In Q2 2024: 49

AstraZeneca PLC (NASDAQ:AZN) is a British pharmaceutical company headquartered in Cambridge. It has one of the most diversified drug pipelines in the industry which is made of items such as its ADRIATIC drug for small cell lung cancer, LAURA drug for stage three lung cancer, and DESTINY drug for breast cancer. All these drugs are in late stage development and provide significant catalysts for AstraZeneca PLC (NASDAQ:AZN). As if this wasn’t enough, the firm’s drug for ovarian cancer called LYNPARZA has also received the European Commission’s positive recommendation, joining IMFINZI, a diversified immunotherapeutic treatment for several cancers including bile duct and gallbladder cancer. These drugs have demonstrated good performance in phase three trials, which increases their chances of a successful commercial launch and future revenue for AstraZeneca PLC (NASDAQ:AZN). Consequently, the firm is trading at a high P/E ratio of 41 and a more modest forward P/E ratio of 20.

As for its current portfolio, here’s what AstraZeneca PLC (NASDAQ:AZN)’s management shared during the Q2 2024 earnings call:

“As Pascal just highlighted, we have had a very strong start to the year with total revenue increasing 18%. This was driven largely by substantial product sales growth across the portfolio. Alliance revenue also increased by 50% in the first half, mainly driven by an increase in HER2 sales in regions where Daiichi Sankyo record revenue. Please turn to the next slide. This is our core P&L. In the first half, total revenue grew 18%, as I just mentioned, and our core product sales gross margin was 82.4%. We’ve previously said that we anticipate a slightly lower core product sales gross margin for the full year versus 2023, and we expect downward pressure in the second half driven by the usual seasonal impact of medicines such as FluMist, as well as increased before supply, which comes at a lower gross margin.”