1. Jazz Pharmaceuticals plc (NASDAQ:JAZZ)
Number of Hedge Fund Holders: 38
Topping our list of Best Weed Stocks to Buy is Jazz Pharmaceuticals plc (NASDAQ:JAZZ), a global biopharmaceutical company with a focus on oncology and neuroscience. Its $7.2 billion acquisition of GW Pharmaceuticals in 2021 was a great sign of the growing legitimacy and increased receptivity of cannabis-based drugs in the pharma industry. With that purchase, JAZZ – which had focused primarily on sleep medications and oncology – also augmented its neuroscience portfolio.
JAZZ has been able to consistently increase its revenue for the last four years, from $2.36 billion in 2020 to $3.83 billion in 2023, with the company moving from loss to profitability last year. The Ireland-based company earned a revenue of almost $902 million in the Q1 of 2024, up 1.3% from the same quarter in 2023. However, it still reported a net loss of $14.62 million against a previous net profit of $69.42 million, mainly due to the high operating expenses. The company explained that most of these expenses went toward supporting strategic initiatives for its commercial business and that it expects these investments to positively impact revenue as the year progresses.
Although JAZZ recently witnessed a setback after its drug, suvecaltamide, failed to meet the primary endpoint in phase 2b trial, big positive news in the last quarter came from Xywav, a medication used to treat cataplexy or excessive daytime sleepiness.
Renée Galá, President and COO of JAZZ announced in the company’s Q1 earnings call transcript:
“There were approximately 9,900 narcolepsy patients taking Xywav exiting the first quarter, an increase of 375 patients from the prior quarter. Given the increased use of patient support programs, revenues for the quarter do not fully reflect these patient additions. We believe patient numbers are the best indicator of the long-term value and durability of this product and expect that revenues will be more aligned with patient numbers going forward as newly transitioned patients revert to being fully covered by their insurance providers.”
Things are also looking positive for Zanidatamab, a targeted treatment option for HER2-positive biliary tract cancer (BTC), as the FDA recently accepted the company’s application and granted Priority Review, shortening the review period to six months. And although approval is not guaranteed, JAZZ believes that the drug has the potential to generate a significant commercial opportunity of more than $2 billion.
The stock of Jazz Pharmaceuticals plc (NASDAQ:JAZZ) was held by 38 hedge funds at the end of Q1 2024 in the IM database, with the largest stake of 1.43 million shares held by Polaris Capital Management, valued at over $172.5 million.
While we acknowledge the potential of JAZZ as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as JAZZ but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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