In this article, we will discuss the 5 best medical stocks under $10. To read our detailed analysis of the healthcare sector, go directly to the 10 Best Medical Stocks Under $10.
5. Roivant Sciences Ltd. (NASDAQ:ROIV)
Number of Hedge Fund Holders: 27
Stock Price as of August 2: $3.70
Roivant Sciences Ltd. (NASDAQ:ROIV) is a Basel, Switzerland-based healthcare company founded in 2014 by Vivek Ramaswamy. The company is incorporating technology into the development of new drugs.
Roivant Sciences Ltd. (NASDAQ:ROIV) has shifted all its resources to maximizing sales for its VTAMA cream for plaque psoriasis and has also joined forces with Pfizer, Inc. (NYSE:PFE) by launching Priovant Therapeutics. The US Food and Drug Administration approved the VTAMA cream on May 24, making it the first steroid-free treatment given the go-ahead by the regulatory authority. Analysts think that Roivant Sciences Ltd. (NASDAQ:ROIV) is sitting on a $2 billion-plus drug, which could propel the company’s current market capitalization of $2.60 billion to new heights.
Overall, 27 hedge funds held a stake in Roivant Sciences Ltd. (NASDAQ:ROIV) as of Q1 2022.
4. Ginkgo Bioworks Holdings, Inc. (NYSE:DNA)
Number of Hedge Fund Holders: 30
Stock Price as of August 2: $3.00
Ginkgo Bioworks Holdings, Inc. (NYSE:DNA) is a Boston, Massachusetts-based biotech company that uses genetic engineering to create bacteria for industrial uses.
The company intends to complete the acquisition of Zymergen Inc. (NASDAQ:ZY), a biotech company, in an all-stock transaction of $300 million by the end of Q1 2023. The holder of one share of Zymergen will receive 0.9179 shares of Ginkgo Bioworks Holdings, Inc. (NYSE:DNA). This would mean that the shareholders of Zymergen will have Pro-forma ownership of 5.25% in Gingko. The deal is Ginkgo Bioworks Holdings, Inc.’s (NYSE:DNA) largest acquisition to date. It would help the company expand its horizontal platform, which targets customers in different sectors.
Ginkgo Bioworks Holdings, Inc. (NYSE:DNA) has notable hedge funds like Viking Global and Ark Investment Management among its top 10 shareholders as of Q1 2022. On July 5, Viking Global Investors increased its ownership stake in Ginkgo Bioworks Holdings, Inc. (NYSE:DNA) from 6.5% to 9.7% by acquiring an additional 64.02 million shares in the company.
3. Cano Health, Inc. (NYSE:CANO)
Number of Hedge Fund Holders: 38
Stock Price as of August 2: $6.42
Cano Health, Inc. (NYSE:CANO) is a Miami, Florida-based primary care provider.
On June 24, John Ransom at Raymond James initiated coverage on Cano Health, Inc. (NYSE:CANO) with an ‘Outperform’ rating and a target price of $8. The analyst thinks that the entity is in a position to deliver growth driven by the support of Medicare Advantage. Cano Health, Inc. (NYSE:CANO) is planning to deliver 44% YoY growth by adding 54 to 59 new medical centers into its network in 2022. The analyst anticipates the company’s revenue will compound annually by 30%, while adjusted EBITDA will grow at a 20% CAGR through 2024. Ransom also added that Cano Health, Inc.’s (NYSE:CANO) focus on the build-buy-manage strategy sets the company apart from its competitors.
Of the 912 hedge funds in Insider Monkey’s database, 38 elite funds held a stake in Cano Health, Inc. (NYSE:CANO) at the end of Q1 2022.
2. EQRx, Inc. (NASDAQ:EQRX)
Number of Hedge Fund Holders: 38
Stock Price as of August 2: $5.07
EQRx, Inc. (NASDAQ:EQRX) is a Cambridge, Massachusetts-based biotech company working on recreating the drug discovery process and introducing medicines at significantly lower prices with global accessibility.
On June 13, Chris Shibutani at Goldman Sachs commenced coverage on EQRx, Inc. (NASDAQ:EQRX) with a ‘Buy’ rating and a target price of $8. The target price assumes potential upside of over 57% from the closing price as of August 2, which still reflects an attractive entry point for potential investors. The analyst thinks that the current stock price is significantly underappreciated and reflects unnecessarily bearish views on the approval of the company’s two lead candidates aumolertinib and sugemalimab. Shibutani expressed confidence in EQRx, Inc.’s (NASDAQ:EQRX) ability to deliver on its strategic mission. Furthermore, EQRx, Inc. (NASDAQ:EQRX) has filed for a marketing authorization application for aumolertinib with the UK Medicines and Healthcare products Regulatory Agency.
The number of hedge funds with an ownership stake in EQRx, Inc. (NASDAQ:EQRX) increased from 31 in Q4 2021 to 38 in the first quarter of 2022.
1. Viatris Inc. (NASDAQ:VTRS)
Number of Hedge Fund Holders: 55
Stock Price as of August 2: $9.66
Viatris Inc. (NASDAQ:VTRS) is a Canonsburg, Pennsylvania-based healthcare and pharmaceutical corporation. The firm was created in November 2020 following the merger of Mylan and Upjohn, which was a legacy division of Pfizer, Inc. (NYSE:PFE).
As of August 2, Viatris Inc. (NASDAQ:VTRS) stock offers an attractive dividend yield of over 4.9%. Furthermore, the company is looking into executing a share buyback plan in the wake of the cash it generated through an asset sale. Approximately 8.5% in shareholder value will be generated through a share buyback plan of $1 billion. Viatris Inc. (NASDAQ:VTRS) is set to announce its Q2 2022 results on August 8. The consensus revenue and adjusted EPS estimate for Viatris Inc. (NASDAQ:VTRS) stands at $4.18 billion and $0.83, respectively. Experts rate Viatris Inc. (NASDAQ:VTRS) as a ‘Buy’ below the $10 level as the risk/reward profile of the stock is favorable for long-term investors.
Davis Funds discussed its outlook on Viatris Inc. (NASDAQ:VTRS) in its Q4 2021 investor letter. Here’s what the firm said:
“Healthcare is included in the portfolio both for company-specific reasons, as well as big picture trends. At the company level, we hold select companies in pharmaceuticals, healthcare services and health insurance at attractive valuations. This is at a time when the average age of the U.S. population is fast approaching 40, older than Asia-Pacific and a little younger than the aged populations of Europe and Japan. The number of seniors in the U.S.—i.e., 65 years or older— now surpasses 54 million, or about 15% of the population. Seniors, on average, take a much greater number of medications and account for a large and disproportionate share of healthcare spending, and we expect that trend to continue due to both raw demographics and a proliferation in the number of available treatments and services available now, the latter being driven by innovation and investment in the healthcare industry. Representative holdings in the Fund include Cigna, United Health Group, Viatris and Quest Diagnostics.”
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