We recently published a list of 10 Best Safe Stocks To Buy According to Analysts. In this article, we are going to take a look at where Amgen Inc. (NASDAQ:AMGN) stands against other best safe stocks to buy according to analysts.
Market Will End 2024 Positively, Strategist Says
Statistically, November and December tend to be great months for stocks. However, with the economic turmoil in question, will stocks end the year on a positive note? On November 30, Quincy Krosby, chief global strategist at LPL Financial, joined Market Domination on Yahoo Finance to discuss her market thesis. Krosby believes that the market will end the year in “positive territory,” assuming that no unexpected or headline events occur moving forward. She also added that portfolio managers will strive to report gains, and will most likely close books before the end of 2024.
Krosby revealed that the market is very “enthusiastic” about the new administration, despite serious concerns over tariffs. She shared that while 2024 has been a solid year for stocks, some moderation is expected in 2025. She also said that the number of earning revisions coming down for the year ahead is evidence of moderation, adding that if the Fed decides to withdraw its easing cycle plan or alter it, the market is going to be “pretty disappointed.”
She stated that in 2025, the market will have greater funding needs, reaching nearly $7.5-8 trillion, and greater uncertainty along with geopolitical risks. However, despite this, the market has been marching higher and navigating through these risks and is expected to continue doing so. Speaking about “waning business pricing power,” Krosby stated that while consumers have been spending, they are looking for “more bargains.” Companies have also been trying to beat tariffs and figure out which areas of the market are going to get more expensive.
Speaking of market uncertainty, Krosby believes how the market unfolds will be crucial and critical. Overall, she shared her bullish stance on industrials, especially names in the defense, building, and defense manufacturing industries. She also added that stocks in the communication sector, especially those with higher dividend offerings, particularly if the Fed easing cycle goes as planned, are going to perform better in the coming year.
While the future of the Fed cycle and inflationary pressures may be uncertain, some stocks have historically been safe to invest in. That said, let’s take a look at the 10 safe stocks to buy according to analysts.
Our Methodology
To come up with the 10 safe stocks to buy according to analysts we consulted multiple reports and also screened for reliable growers using the Finviz stock screener. We compiled an initial list of 30 stocks. We then referred to the 10-year revenue growth rate for each stock and a solid analyst upside, of at least 8%. The 10 safe stocks to buy according to analysts are in ascending order of the analyst upside as of December 9, 2024. We also included the hedge fund sentiment of each stock.
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 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
A pharmacist filling a prescription for a complex drug developed by the company.
Amgen Inc. (NASDAQ:AMGN)
Analyst Upside as of December 9, 2024: 23%
10-Year Revenue Growth Rate: 5.12%
Number of Hedge Fund Holders: 68
Amgen Inc. (NASDAQ:AMGN) is a biotechnology company headquartered in California, United States, with a commitment to work for patients suffering from serious illnesses. In the third quarter of 2024, the company grew its revenue by 23% and product sales by 24%, driven by a 29% growth in volume. 10 products of its entire portfolio experienced at least double-digital growth in sales during the quarter.
Amgen Inc. (NASDAQ:AMGN) is a safe stock to buy and we say that because of its cash flow situation. During the quarter, the company generated $3.3 billion of free cash flow up from $2.5 billion in the third quarter of 2023. The company attributes its growing cash flow to its business performance and the timing of working capital items. The company’s cash flow performance also allowed AMGN to pay a dividend of $2.25 per share, a 6% increase from the same quarter in 2023. Similarly, AMGN also saw a significant reduction in its principal debt by almost $4.5 billion, year-to-date.
In addition to its strong financial performance and liquidity, Amgen Inc. (NASDAQ:AMGN) is also emerging as a leader in biotechnology by directing more investments to research and development. In the third quarter alone, the company saw a 34% increase in R&D expenses, primarily directed at later-stage clinical programs, marketed product support, and research and early pipeline. Overall, the company’s expansion strategy coupled with its business performance, reflects its financial strength and position in the industry.
PGIM Jennison Health Sciences Fund stated the following regarding Amgen Inc. (NASDAQ:AMGN) in its Q2 2024 investor letter:
“Amgen Inc. (NASDAQ:AMGN) is a large cap global biotech company with a diverse portfolio of marketed and pipeline products. Amgen’s discovery pipeline had led the company to broaden its focus from oncology, immunology, and renal disease to include musculoskeletal, cardiovascular, and neurologic conditions. In addition, Amgen has turned its expertise in antibody manufacturing into a leading position in the development of biosimilars of competitor drugs. Most recently, Amgen shares advanced in 2Q following its announcement that its novel injectable GLP-1 agonist / GIPR antagonist, MariTide, for obesity showed promising interim Phase 2 data and has shown enough promise to warrant advancement into pivotal trials as soon as late 2024. While Eli Lilly and Novo Nordisk will remain the market leaders in the diabetes / obesity space, we think there is room for Amgen to carve out a meaningful share of the market with its antibody-peptide conjugate approach that could enable monthly or better dosing for MariTide.”
Overall, AMGN ranks 2nd on our list of best safe stocks to buy according to analysts. While we acknowledge the potential of AMGN to grow, our conviction lies in the belief that certain AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than AMGN but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 8 Best Wide Moat Stocks to Buy Now and 30 Most Important AI Stocks According to BlackRock
Disclosure: None. This article is originally published at Insider Monkey.