Amgen (NASDAQ:AMGN) enjoyed a pretty good 2017. The stock was up 19% for the year. Amgen's non-GAAP earnings per share (EPS) increased 8% year over year. And the big biotech won several approvals from the U.S. Food and Drug Administration (FDA).

Amgen stock now trades at only 13 times expected earnings. With a relatively solid performance behind it and a seemingly attractive valuation, is the biotech stock a buy now?

A buy decision diagram next to pen and calculator.

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The case for Amgen

The first reason to consider buying Amgen stock consists of five components. At the J.P. Morgan Healthcare Conference in January, Amgen CEO Bob Bradway talked about the "compelling long-term growth drivers" for the company, listing five products.

Osteoporosis drug Prolia topped Bradway's list. Sales for the drug increased 20% in 2017 to just under $2 billion. Cholesterol drug Repatha was next. Although Amgen has encountered payer resistance for the high-priced drug in the past, Bradway said that the FDA's approval for a label change including positive cardiovascular outcomes data should help boost sales.

Multiple myeloma drug Kyprolis also made Bradway's group of long-term growth drivers. So did the biotech's biosimilars program, which includes biosimilars to several top-selling drugs. Last but not least, Bradway mentioned migraine drug Aimovig. Amgen and partner Novartis hope to win FDA approval for the drug by May 17, 2018.

Another reason to think about buying Amgen stock is the company's dividend, which currently yields 2.88%. The biotech has increased its dividend every year since initiating the program in 2011. Since then, Amgen's dividend has grown more than 370%, making it one of the fastest-growing dividends on the market. With the company's strong cash flow, it seems likely that Amgen will be able to keep the dividend hikes coming.

There's at least one other reason Amgen stock could be a smart pick: the company's cash stockpile. At the end of 2017, Amgen had $41.7 billion in cash, cash equivalents, and marketable securities.

Amgen CFO David Meline said at the Leerink Partners Global Healthcare Conference last week that the company knows "lots of innovation occurs externally" and Amgen is "interested in pursuing" those opportunities. Amgen has the financial flexibility and motivation to make one or more deals that could help position it for growth. 

The case against Amgen

Probably the most compelling argument against buying Amgen stock is that the biotech's revenue has begun to slip. Amgen has been able to fuel EPS growth with stock buybacks, but that doesn't help the top line.

While Amgen's revenue fell by less than 1% in 2017, the situation probably won't improve in the near term. Amgen's biggest problem right now is its top-selling drug, Enbrel. Sales for the autoimmune disease drug fell 9% in 2017. Enbrel faces really tough competition that isn't going away.

Amgen also experienced smaller year-over-year sales declines for its No. 2 and No. 3 best-selling drugs, Neulasta and Aranesp. It's only a matter of time before the company has biosimilar competition for Neulasta. And Epogen won't be a blockbuster much longer if sales decline by 15% this year like they did in 2017. Biosimilar rivals to the drug could be on the U.S. market soon.

Growth from Amgen's other drugs probably won't be enough to offset declining sales for the company's current top drugs. There's no guarantee that the long-term growth drivers identified by Bradway will deliver on their potential.

Finally, while Amgen has plenty of cash to spend on acquisitions that could fuel growth, there is one area of concern. Plenty of other big drugmakers are also looking to make acquisitions. It could cost Amgen a lot more than it would like to spend to buy one of the most attractive acquisition candidates.

To buy or not to buy?

Amgen is not a bad stock. The biotech certainly faces challenges over the next couple of years with declining revenue for its top products. However, Amgen also has some promising newer products and the financial flexibility to acquire more. Over the long run, it looks like Amgen will perform pretty well.

However, the decision to buy or not to buy Amgen stock isn't made in a vacuum. There are other investment opportunities to consider. While I'm not overly negative about Amgen's future, there are better stocks to buy -- including better biotech stocks.

Keith Speights owns shares of JPMorgan Chase. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.