Obesity Drugs 2024: The Skinny on the Top 3 Weight-Loss Stocks

Stocks to buy

The catalyst for top weight-loss stocks comes down to one sweeping attribute: a burgeoning total addressable market.

According to a Goldman Sachs analysis, earlier last year, the global industry for anti-obesity medications (AOMs) reached $6 billion on an annualized basis. By 2030, the sector could expand by more than 16 times to $100 billion.

One of the main reasons why top weight-loss stocks have been performing well is the intersection between the underlying solutions and therapeutics addressing issues such as diabetes. Further, with the Covid-19 pandemic imposing a collective widening of the beltline, the sector enjoys a cynical tailwind.

On that note, below are enticing ideas for top weight-loss stocks.

Novo Nordisk (NVO)

Novo Nordisk logo on a corporate building

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If we’re going to talk about top weight-loss stocks, we can’t ignore Novo Nordisk (NYSE:NVO). To be sure, NVO aligns with a strength-begetting-strength argument. Since the start of the year, shares have already gained more than 33% of market value. In the past 52 weeks, NVO has popped up over 92%.

These metrics might stop prospective investors in their tracks. Not helping matters is that while analysts do rate NVO stock as a moderate buy, the average price target is $118.86. That implies downside risk of almost 13%. Nevertheless, it’s also important to realize that NVO gained nearly 11% in the pats five sessions.

Translation? This idea seems to have legs. Fundamentally, investors have responded vigorously to Novo Nordisk’s phase 1 trial data for Amycretin, the company’s latest weight-loss product. The new drug shows over 13% weight loss in users after 12 weeks of use, a far superior result to Novo’s other drug Wegovy.

With 2024 and 2025 revenue projected to hit $41.57 billion and $49.33 billion, respectively, it may be time to readjust expectations northward. Novo is delivering, making NVO one of the top weight-loss stocks.

Amgen (AMGN)

Source: Shutterstock

If you want a sector-related idea that’s away from the glaring spotlight, Amgen (NASDAQ:AMGN) could be intriguing. A multinational biopharmaceutical company, is conducting early stage human trials for an experimental obesity drug. In a medical journal, Amgen stated that the therapeutic promoted significant weight loss with an acceptable safety profile.

However, the market hasn’t exactly been impressed. Since the beginning of the year, AMGN stock lost more than 8% of equity value. Over the past 52 weeks, it gained over 19% – a solid return but nothing like Novo Nordisk. Still, that’s what makes AMGN intriguing for speculators.

Right now, analysts anticipate that 2024 sales will land at $33.02 billion. If so, that would translate to a 17.1% gain from last year’s sales of $28.19 billion. And in 2025, they believe the company can post revenue of $34.16 billion. That would translate to 3.4% growth over projected 2024 sales.

To entice prospective investors, the market prices AMGN at 15.19X trailing-year earnings without non-recurring items (NRI). As well, experts peg shares a moderate buy with a $312 average price target, implying over 14% upside potential.

Pfizer (PFE)

blue Pfizer logo on the windows of a corporate building PFR stock

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Easily one of the riskiest ideas within the broader healthcare umbrella, Pfizer (NYSE:PFE) of course soared to prominence during the Covid-19 crisis. As one of the early winners of the vaccine narrative, PFE stock enjoyed robust upside. However, in 2022, fears of the crisis faded dramatically. So too did Pfizer’s market value.

Still, this dynamic opens a door for one of the most undervalued ideas for top weight-loss stocks. Now, some of the drama is self-imposed. According to a Reuters report in December last year, Pfizer dropped its twice-daily version of oral weight-loss drug danuglipron. That saw PFE stock suffer a huge drop at the time.

However, the company stated that its once-daily version of the weight-loss pill is still in development. Early data will not be available until the first half of this year. So, that’s where the speculation part comes in.

Fortunately for bullish speculators, analysts are optimistic, rating shares a consensus moderate buy. The price target stands at $31.18, implying over 16% upside potential. Further, the high-side target stands at $45, which projects 68% growth.

On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

A former senior business analyst for Sony Electronics, Josh Enomoto has helped broker major contracts with Fortune Global 500 companies. Over the past several years, he has delivered unique, critical insights for the investment markets, as well as various other industries including legal, construction management, and healthcare. Tweet him at @EnomotoMedia.

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