We recently compiled a list of the 12 Most Promising Biotech Stocks According to Wall Street Analysts. In this article, we are going to look at where Jazz Pharmaceuticals plc (NASDAQ:JAZZ) stands against other biotech stocks.
Biotech Sector Set for Growth Amid Innovation and Investor Interest
The biotechnology sector is gaining new momentum with better market conditions, cutting-edge innovations, and growing investor attention. The industry has recovered from a challenging 2024 and is poised for significant expansion led by advances in personalized medicine, AI-driven drug discovery, and growing demand for biologics. MarketsandMarkets predicted that the global biotech market would expand by a strong 13%, from $483.0 billion in 2024 to $546.0 billion in 2025. This expansion demonstrates the sector’s tenacity and promise for growth.
The anticipated shift in the Federal Reserve’s interest rate policies is a key driver of this upturn. Biotech is sensitive to changing rate patterns since it requires a large amount of money for costly R&D and clinical testing. Lower rates make more funding available, which helps biotech companies expand, draw in venture capital, and expedite drug development, according to Genetic Engineering and Biotechnology News. A rate drop, according to analysts, may release billions of dollars in investment funds that have been put aside for fledgling biotech firms looking for steady funding.
Investor interest in biotech equities is growing. Biotech is still a high-growth industry with many chances for risk-takers, despite brief ups and downs. The comeback of biotech has been noted by leading investment banks. Citing solid fundamentals, improved clinical outcomes, and a supportive regulatory environment, Goldman Sachs referred to it as an “undervalued opportunity.” According to the firm, biotech equities have tremendous upside potential and an “option-like structure,” particularly when interest rates decline. Analysts at JPMorgan anticipate a recovery in biotech funding at the same time, pointing to indications of stability in manufacturing and research sectors that were negatively impacted by earlier funding shortages. Industry analysts predict that declining interest rates and advantageous investment circumstances may reopen the IPO window for businesses looking for institutional support, even though biotech IPOs have been quiet since 2021.
As gene editing, AI-powered drug discovery, and precision medicine transform how we treat uncommon genetic illnesses, autoimmune diseases, and cancer, scientific advances are also propelling the expansion of biotech. Biotech firms are meeting medical demands in ways that were unthinkable a decade ago because of developments in CRISPR gene editing and cell treatments. Given this, we will take a look at some of the best promising stocks from the biotech sector.
Our Methodology
For this article, we shortlisted stocks that met the following criteria: a market capitalization of over $2 billion, coverage by at least 15 analysts, and a price target upside of more than 20%. We then ranked the selected stocks based on their price target upside, as determined by Wall Street analysts, as of March 21, 2025.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
A biopharmaceutical scientist in their lab, studying a newly-diagnosed therapy-related acute myeloid leukemia. .
Jazz Pharmaceuticals plc (NASDAQ:JAZZ)
Analyst Upside: 39.68%
Jazz Pharmaceuticals plc (NASDAQ:JAZZ) is a biopharmaceutical company specializing in neuroscience and oncology, focusing on treatments for serious diseases with limited therapeutic options, such as narcolepsy, epilepsy, and certain cancers.
At the American Epilepsy Society 2024 conference on December 6, 2024, Jazz Pharmaceuticals plc (NASDAQ:JAZZ) presented fresh Epidiolex (cannabidiol) research that demonstrated its advantages beyond seizure management. Research has shown that patients with epilepsy and tuberous sclerosis complex (TSC) had improved emotional well-being, communication, and cognitive abilities. Most nurses and caregivers continued treatment, reporting better quality of life and fewer seizures. Epidiolex’s broad-spectrum efficacy was further supported by the EpiCom trial, which revealed that it also decreased behavioral problems in TSC patients.
With over $4 billion in revenue and significant growth across its sleep, epilepsy, and oncology portfolios—all of which generate over $1 billion annually—Jazz Pharmaceuticals plc (NASDAQ:JAZZ) had a successful 2024. The FDA’s expedited approval of Ziihera for HER2+ biliary tract cancer and encouraging developments in late-stage pipeline assets were among the company’s significant accomplishments. With $3 billion in cash at the end of 2024 and a voluntary $750 million debt payoff, the company strengthened its position for further expansion in 2025.
Wall Street analysts maintain a Strong Buy rating on the stock. Over the past three months, 18 analysts have set a 12-month average price target of $193.82, with estimates ranging from $150.00 to $230.00. This suggests a potential 39.68% increase from the current price of $138.76.
Overall, JAZZ ranks 9th among the 12 most promising biotech stocks according to wall street analysts. While we acknowledge the potential of biotech companies, 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 more promising than JAZZ but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure. None: This article is originally published on Insider Monkey.