In this article, we discuss the 5 best drug stocks to invest in. You can go through our detailed analysis of the pharmaceutical sector and its outlook this year, and go directly to read the 15 Best Drug Stocks To Invest In.
5. AbbVie Inc. (NYSE:ABBV)
Number of Hedge Fund Holders: 73
AbbVie Inc. (NYSE:ABBV) functions as a specialized biopharmaceutical company dedicated to the exploration, development, manufacturing, and distribution of medications tailored for chronic and intricate illnesses. The company is renowned for its flagship drug, Humira, a crucial treatment for conditions like moderate-to-severe rheumatoid arthritis and Crohn’s disease.
Boasting an impressive 50-year streak of continuous dividend growth, the American pharmaceutical giant currently presents a dividend yield of 4.48% as of November 19.
As of the close of the third quarter in 2023, Insider Monkey’s database, monitoring 910 hedge funds, indicated 73 holdings in AbbVie Inc. (NYSE:ABBV), marking a slight decrease from the 74 hedge funds in the previous quarter. The collective value of these holdings surpasses $3.27 billion.
4. Merck & Co., Inc. (NYSE:MRK)
Number of Hedge Fund Holders: 85
Merck & Co., Inc. (NYSE:MRK) is a distinguished American multinational pharmaceutical company headquartered in Rahway, New Jersey. Originally the American division of the Merck Group, established in Germany in 1668, it retains the name of its former parent company. Operating as Merck Sharp & Dohme or MSD outside the United States and Canada, the company holds a prominent position in the pharmaceutical industry, specializing in the development of medicines, vaccines, biologic therapies, and animal health products.
Demonstrating a consistent pattern of dividend growth for 11 consecutive years, the company currently offers a quarterly dividend of $0.73 per share, resulting in a dividend yield of 2.87% as of November 19.
Insider Monkey dug through 910 hedge funds for their third quarter of 2023 investments to discover that 85 had invested in Merck & Co., Inc. (NYSE:MRK), up from 78 in the previous quarter.
Carillon Eagle Growth & Income Fund made the following comment about Merck & Co., Inc. (NYSE:MRK) in its Q2 2023 investor letter:
“Merck & Co., Inc. (NYSE:MRK) presented positive clinical data for a new drug in its oncology pipeline, announced an acquisition that was viewed favorably by investors, and reported strong first-quarter financial results while also increasing its earnings guidance for 2023.”
3. Johnson & Johnson (NYSE:JNJ)
Number of Hedge Fund Holders: 88
Founded in 1886, Johnson & Johnson (NYSE:JNJ) stands as a prominent American multinational corporation renowned for pioneering advancements in medical devices, pharmaceuticals, and consumer packaged goods. The company’s pharmaceutical division has notably sustained a remarkable record of dividend growth for over 62 years. As of November 19, Johnson & Johnson (NYSE:JNJ) offers a quarterly dividend of $1.19 per share, equating to a dividend yield of 3.18%.
On October 17, Johnson & Johnson (NYSE:JNJ) revealed adjusted earnings and revenue that surpassed Wall Street forecasts. Consequently, it raised its full-year guidance due to robust sales in both pharmaceuticals and medical devices. The company reported a net income of $4.31 billion, translating to $1.69 per share. This figure remained consistent with the net income of $4.31 billion, or $1.62 per share, reported for the corresponding period in the previous year.
In the third quarter of 2023, the number of hedge funds tracked by Insider Monkey with holdings in Johnson & Johnson (NYSE:JNJ) declined to 84, down from 88 in the prior quarter. The collective investments by these hedge funds surpass a total value of $4.15 billion. A leading hedge fund investor in Johnson & Johnson (NYSE:JNJ) is Bridgewater Associates, managed by Ray Dalio, with a substantial stake valued at approximately $424.3 million.
2. Eli Lilly and Company (NYSE:LLY)
Number of Hedge Fund Holders: 102
Founded in 1876, Eli Lilly and Company (NYSE:LLY) is an American pharmaceutical enterprise headquartered in Indianapolis, Indiana, with a global presence spanning 18 other countries. The company is named after its founder, Colonel Eli Lilly, a pharmaceutical chemist and a veteran of the American Civil War.
Eli Lilly and Company (NYSE:LLY) maintains a consistent quarterly dividend of $1.13 per share and has exhibited a steady pattern of dividend growth for the past ten consecutive years. Impressively, the company has been providing uninterrupted dividends to shareholders for 138 years. As of November 19, the stock offers a dividend yield of 0.76%.
In Q3 2023, the number of hedge funds holding stakes in Eli Lilly and Company (NYSE:LLY) increased to 102, up from 87 in the previous quarter, as per data from Insider Monkey’s database, which tracks 910 hedge funds. The combined value of these stakes surpasses $9 billion.
Madison Sustainable Equity Fund made the following comment about Eli Lilly and Company (NYSE:LLY) in its Q3 2023 investor letter:
“Eli Lilly and Company (NYSE:LLY) again moved higher in the third quarter. The stock has continued to be fueled by its diabetes franchise, in particular Mounjaro, which has been approved for use in diabetes but is also expected to be approved in obesity later this year. We are also waiting for approval of donanemab for Alzheimer’s which should occur by year end.”
1. Danaher Corporation (NYSE:DHR)
Number of Hedge Fund Holders: 103
Established in 1984 by brothers Steven and Mitchell Rales, Danaher Corporation (NYSE:DHR) stands as a diversified American conglomerate with a global footprint. Headquartered in Washington, D.C., the company specializes in the design, manufacturing, and marketing of medical, industrial, and commercial products and services. Danaher Corporation (NYSE:DHR) operates through three distinct segments: Life Sciences, Diagnostics, and Environmental & Applied Solutions.
Danaher Corporation (NYSE:DHR) released its Q3 2023 earnings report on October 24, 2023, revealing a net earnings figure of $1.1 billion, equivalent to $1.51 per diluted common share. Despite encountering a 10.5% year-over-year decline in revenues, totaling $6.9 billion, the company surpassed expectations in earnings, showcasing resilience in a challenging operating environment.
As of September 2023, 103 among the 910 hedge funds surveyed by Insider Monkey had bought the firm’s shares.
Disclosure: None. You can also take a look at 14 Best Cyclical Stocks To Invest In and 10 Travel Stocks Billionaires Are Loading Up On.
