12 Best Weight Loss Stocks to Buy According to Hedge Funds

8. Biohaven Ltd. (NYSE:BHVN)

Number of Hedge Fund Holders: 42 

Biohaven Ltd. (NYSE:BHVN) is a clinical-stage biopharmaceutical company developing innovative treatments for neurological, immunological, and oncological diseases. Its pipeline includes drugs for conditions like epilepsy, migraines, OCD, SMA, obesity, and cancer. Key drug candidates are BHV-7000 (Kv7 activator), Troriluzole (tripeptide prodrug), and Taldefgrobep (HV-2000) for obesity.

Biohaven Ltd. (NYSE:BHVN) is developing taldefgrobep alfa, which is a myostatin inhibitor targeting obesity through a unique mechanism that increases lean muscle mass and resting metabolism. It stands eighth on our list of the best weight loss stocks. Unlike GLP-1 agonists, which often reduce both fat and muscle, taldefgrobep promotes fat loss while preserving and enhancing lean mass. Preclinical and early human trials show significant fat reduction (11% in mice) and a 25% increase in lean muscle. Additional benefits include improved metabolic health, with lower insulin and leptin levels observed in treated mice. Taldefgrobep has demonstrated a favorable safety profile, with no serious adverse events in over 500 patients in prior SMA trials.

In the third quarter of 2024, Biohaven Ltd. (NYSE:BHVN) reported a net loss of $160.3 million ($1.70 per share), an increase from the net loss of $102.6 million ($1.50 per share) in the same period in 2023. The non-GAAP adjusted net loss was $164.1 million ($1.74 per share), up from $98.1 million ($1.44 per share) in Q3 2023. This increase in net loss was primarily attributed to higher research and development (R&D) and general and administrative (G&A) expenses.

Biohaven Ltd. (NYSE:BHVN)’s R&D expenses rose significantly to $157.6 million, up from $95.5 million in Q3 2023, due to ongoing clinical trials and preclinical research. Additionally, G&A expenses increased to $20.6 million from $15.0 million in the same period last year, reflecting higher share-based compensation. Despite these challenges, the company saw an improvement in other income, which surged to $17.8 million from $4.7 million in Q3 2023. This increase was largely driven by changes in the fair value of derivative liabilities and higher investment income.

Analysts hold a consensus Strong Buy rating on the stock and as of Q3 2024, 42 hedge funds held shares in the company.